Financial services has contributed more than any other sector to economic growth since 1974, with the second least volatile growth over that period, according the Financial Services Council (FSC) 2019 State of the Industry Report.
The report showed the sector itself was responsible for nine per cent of the economy, with one of the fastest rates of productivity growth from 1990-2018.
Superannuation assets are currently $2.8 trillion, which was 150 per cent of gross domestic product (GDP), which is expected to increase to 167 per cent by 2028.
Australia’s superannuation system was the fourth-largest private pension system in the world, with an average return of 7.5 per cent a year with other developed markets averaging 3.8 per cent.
The FSC’s Life Insurance Code of Conduct had resulted in major changes to every aspect of consumer interaction with the industry, with a review likely to make further improvements.
For financial advisers, although there was an increase in numbers in late 2018, they had decreased due to increased regulation, market movements and education standards put in place.
There was $2.9 trillion invested in Australian managed funds, a majority being sourced from superannuation funds with other contributions from wholesale trusts, government and life insurance providers.
One of the areas that still required improvement was diversity in top level management, as only nine per cent of chief executives were women.
Sally Loane, FSC chief executive, said the report showed the financial services industry was the engine room of the economy.
“Financial services touches every Australian, from mortgages to superannuation and retirement savings; how people get paid; through to how people receive asset protection and advice,” Leone said.
“As well as being the largest industry in the national economy, it dominates the economies of both NSW and Victoria, and enjoys one of the fastest rates of productivity growth in the economy.”