Queensland has long been wildly successful at producing and exporting primary resources to the world. But when it comes to technology, consumption far outweighs production.
The technology sector has become the backbone of every other business segment and is absorbing revenue and jobs from traditional industries at an exponential rate.
Queensland farms and mines are more efficient now due to technology and automation, so there are fewer jobs needed for the same output, with the jobs having now shifted to technology companies whose products are powering this efficiency. But these technology companies are not Queensland companies, generally, they are typically not even Australian companies.
The technology sector, is the largest business sector in the world, by market cap. The top 25 public global technology companies represent a combined value of USD$5.7 trillion. That is more than 4 times Australia’s GDP, and 5 times as much as the 2,200 publicly listed companies on the ASX combined, which includes the big banks, retailers, mining companies, technology companies, the lot.
Large technology companies attract talent, retain talent, and develop talent. These companies spur innovation and growth in the startup and technology sectors, they attract capital, and they attract the growth and presence of local technology start-ups.
It is a morbid concern that in Queensland, in a time of mass automation and digital disruption, with a radically changing workforce, when Australia is in an arms race for the production of technology, that an embarrassing zero of these top 25 have a national office in Queensland, despite Sydney hosting 17, and Melbourne 3.
Large technology companies result in huge amounts of tax revenue for the state they are based in. The $8Bn of sales from every iPhone, Mac, or App Store purchase through Apple in Australia is transacted through its company incorporated in NSW, which represents over $800M in GST collected federally, and approximately $680M distributed to the NSW State Government. That is more than the entire $650M Queensland state budget for innovation in 2018/2019.
Google Australia, also incorporated in NSW just surpassed $3Bn in local sales this year, giving a $255M GST windfall for the NSW Government.
Twitter, the primary social network used by the Queensland’s Premier and virtually every state MP, is another California technology giant that calls Sydney home.
Even local Townsville success story, SafetyCulture, one of Australia’s largest funded and high-growth startups, outgrew Townsville, leapfrogged Brisbane, and moved to Sydney.
Queensland cannot afford to continue having jobs flow South, or have more traditional jobs replaced with automated technology in Sydney and Melbourne based companies. Queensland cannot afford to miss out on billions in taxes which could go to infrastructure, schools, hospitals, aged care, and building its innovation sector.
Every week, billions are invested into technology companies around the world, most without a formal presence in Australia, these are the opportunity. Queensland needs to lead the country in targeting these companies, attract them to Queensland before they even look to Australia.
Queensland needs a government with the guts and sense to act, now.
The Queensland Treasurer should attract big-tech to Queensland by offering a rebate on GST they pay, through state incentives. Queensland is distributed $1.09 from the Federal Government for every $1 of GST paid by a QLD incorporated company, so a 9% GST rebate could be an enticing lure for these companies, and Queensland would still be distributed all of the GST they actually pay, based on current distribution share rates.
The Premier needs to stop falling prey to the glitz and glamour of Hollywood, catch a plane to San Francisco, not Los Angeles, and bring the technology CEO’s to Queensland, not the A-listers.