CSIRO released a prediction regarding Australian Foodservice Industry's potential to reach $250 billion by 2030. With an economic contribution of over $186 billion of growth in 2018, the significance of Foodservice in Australia's market and economy cannot be understated.
While these numbers look incredibly promising, the magnitude of how foodservice can critically impact Australia's economy and how it will affect producers, manufacturers, distribution & hospitality sectors moving forward remains unanswered. In this article, we'll examine why the foodservice sector plays such a crucial role in the Australian economy now more than ever.
Fig.1. Australian Food and Agribusiness – Domestic and Export Opportunity, 2018-2030
1. A Major Employer Across the Country
Creating enough job opportunities and increasing employment rates are the primary factors leading to economic growth. The foodservice industry is a substantial employer, offering jobs across various skill levels. The foodservice industry is a significant employer, offering jobs across various skill levels. As of 2024, the cafés, restaurants, and takeaway services sector employed approximately 689,600 individuals, accounting for 72% of the accommodation and food services workforce. It means sustaining the foodservice sector not only supports individuals via employment, but also provides support for our economy.
2. A Multi-Billion Dollar Economic Contributor
Another advantage of higher employment opportunities is that it helps generate a higher Gross Domestic Product (GDP). Seeing as the foodservice sector has one of the largest workforces, the industry has contributed enormously to Australia's GDP, making it an integral component of the country's economic success. Based on a media release by AFAB, the foodservice industry now accounts for 36.4% of the average household's total food and non-alcohol spending, up from 37.2% in 2019 and 33.3% in 2023. The size of the commercial market is expected to grow 7% in 2025.
3. A Catalyst for Innovation
The foodservice industry thrives on innovation, constantly adapting to consumer trends. From plant-based menus to food delivery apps and ghost kitchens, entrepreneurs are reshaping the dining experience. According to State of Play Report 2024, the total market value for of plant-based dairy products in 2022 was over $204 billion dollars. These innovations not only enhance customer satisfaction but also position Australia as a leader in the global foodservice landscape.
4. A Magnet for Tourism
Apart from high employment rates, the foodservice sector also helps sustain other massive industries that contribute to Australia's economic growth. For instance, the foodservice sector supports tourism by providing visitors and tourists with high-quality and unique dining experiences. Each day, more foreigners are seeking these new culinary experiences and they spend billions each year as they visit Australia, creating a higher demand for food and beverage services. This encourages the continued growth of the hospitality sector and it’s all thanks to the quality of our food and beverage culture, cultivated by our foodservice businesses.
5. A Hub of Innovation and Entrepreneurship
Did you know that the foodservice sector is dominated by small-to-medium-sized enterprises? They make account for 98% of all business in the country, which is another reason why the foodservice industry is critical to Australia's overall economy. So not only does the sector increase large-scale economic success, but it also supports the livelihood of Australians and promotes thriving local communities at smaller scales too.
6. Export Opportunities
The foodservice industry doesn't just cater to domestic markets—it also plays a vital role in positioning Australian cuisine on the global stage. Exporting Australian wine, premium meats, and specialty ingredients has created international opportunities for producers and strengthened Australia's reputation as a source of high-quality food and beverages. In fact, in 2018, the country's agriculture accounted for around 11% of goods and services trade, 2.2% of added value on the gross domestic product (GDP) and 2.6% of employment. Presently Australia is exporting more agricultural products than it is importing, with 70% of Australia's agricultural production exported. With global demand for Australian products on the rise, the foodservice sector serves as a gateway to expanding export markets.
7. A Boost for Local Producers and Supply Chains
By sourcing fresh ingredients locally, foodservice businesses bolster Australia's agricultural sector. This symbiotic relationship strengthens domestic supply chains and ensures a steady demand for high-quality Australian produce. The farm-to-table movement further underscores the sector's role in supporting sustainable and local farming practices.
8. Driving Urban Development
Restaurants, cafes, and bars act as anchors for urban revitalization and regional development. In cities, they draw foot traffic to shopping districts, while in rural areas, they serve as focal points for tourism and local activities. This sector helps bridge economic disparities by creating hubs of activity across the country.
9. Social and Cultural Importance
More than economic importance, the foodservice sector is also an integral part of Australia's social culture. Many might not realise just how much of a centrepiece food and beverages are at our social events, celebrations, and gatherings. It serves as a bridge that facilitates social connections and even promotes cultural tradition that, in return, solidifies Australia's community and identity.
10. Resilience in Challenging Times
The foodservice industry has demonstrated remarkable resilience in the face of challenges like the COVID-19 pandemic. While lockdowns devastated traditional dining, many establishments pivoted to online delivery services, takeaway options, and innovative dining solutions such as outdoor seating. A report by news.com.au that shows 60,000 small business and 300,000 people are working in this sector. Even now, with rising inflation and supply chain issues, the sector continues to adapt, underscoring its critical role in sustaining the economy.
The foodservice industry’s significance extends beyond its immediate economic impact. It supports local producers, enhances Australia’s global image, and drives innovation while fostering community connections. That’s why AFAB facilitates a platform for education, connectivity, and leadership to embrace the changing face and capabilities of the foodservice industry.
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