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5260.0.55.002 - Experimental Estimates of Industry Multifactor Productivity, 2010-11  
Previous ISSUE Released at 11:30 AM (CANBERRA TIME) 07/12/2011   
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INTRODUCTION


This data cube provides experimental estimates of multifactor productivity (MFP) for individual industries in the Australian economy. The methodology for constructing the data is outlined in the ABS Information Paper: Experimental Estimates of Industry Multifactor Productivity, 2007 (cat. no. 5260.0.55.001). The ABS publishes industry level MFP estimates on an annual basis.

This data cube includes measures of input, output and MFP at the industry level from 1985–86 onwards for 12 industries, with the remaining market sector industries commencing in 1994–95. It goes beneath the aggregate economy to measure the productivity of individual industries. The 16 industries included in the data cube are as follows:

ANZSIC
Division
Industry
A
B
C
D
E
F
G
H
I
J
K
L
M
N
R
S
Agriculture, Forestry and Fishing
Mining
Manufacturing
Electricity, Gas, Water and Waste Services
Construction
Wholesale Trade
Retail Trade
Accommodation and Food Services
Transport, Postal and Warehousing
Information, Media and Telecommunications
Financial and Insurance Services
Rental, Hiring and Real Estate Services
Professional, Scientific and Technical Services
Administrative and Support Services
Arts and Recreation Services
Other Services

To assist data users to link these industry level estimates to aggregate measures in the Australian System of National Accounts (cat. no. 5204.0), this data cube also includes aggregate MFP measures for the market sector definition (see above, ANZSIC06 Divisions A to N and Divisions R and S) dating back to 1994–95. Also included is a 12 selected industry grouping (Divisions A to K and R), which is useful for analysing productivity performance from the perspective of a longer time series.


CHANGES IN THIS DATA CUBE

IMPACT OF LATEST REVISION TO NATIONAL ACCOUNTS DATA

This data cube release reflects the full historical revision cycle of the 2010–11 release of Australian System of National Accounts (cat. no. 5204.0). Annual benchmarks were revised through the entire time series, to reflect updated source data and improvements to compilation methods.

The revisions directly impacting on productivity measures include:
  • Industry output indicators, which were revised for most industries. Improved compilation methods were implemented for ANZSIC Divisions A, F, G, K, and R;
  • Compensation of employees, one of the key components for calculating labour income shares, which saw revisions to most industries;
  • Capital services indexes, as a result of improved compilation practices and updated source data for Gross fixed capital formation;
  • Rental prices, as a result of improvements to the estimation and allocation of rates and land taxes across industries.

For a more detailed discussion of the full historical revision cycle, please refer to the Analysis of results section of the 2010–11 release of Australian System of National Accounts (cat. no. 5204.0). For a more detailed discussion of the revisions to the Finance and insurance industry, please refer to the Feature Article: Revisions to Finance and Insurance Estimates in the Australian System of National Accounts, released in the 2010–11 issue of Australian System of National Accounts (cat. no. 5204.0).


CONCEPTUAL CHANGE IN OUTPUT VALUATION

A conceptual change in output valuation was introduced for aggregate productivity measures.

Previously, production for the market sector was measured by GDP market sector. This aggregate has been replaced by Gross value added market sector. The difference between the new and old measures of production is that the new measures exclude taxes less subsidies on products. The change means that production for the purposes of productivity measurement will be measured at the prices producers receive (i.e. basic prices), rather than the prices purchasers pay (i.e. purchasers' prices).

The new valuation is consistent with the recommendations of the 2001 OECD Manual – Measuring Productivity, which states that:
    "From the perspective of productivity measurement, the choice of valuation should reflect the price that is most relevant for the producer’s decision making; regarding both inputs and outputs. Therefore, it is suggested that output measures are best valued at basic prices (OECD 2001, p. 77)."

The change also brings the ABS's aggregate measures of productivity into line with the industry estimates in this data cube.

This method change has tended to moderate the productivity slowdown, as real output measures valued at basic prices grow slightly stronger than real output measures valued at purchasers' prices (ie net taxes on products has been declining as a share of GDP).

For a more detailed discussion of this method change, including an impact analysis see the Information Paper: Upcoming changes to the Australian System of National Accounts, 2010–11 (cat. no. 5204.0.55.007).


LIST OF TABLES

1Gross value added based multifactor productivity indexes
2Productivity measures – Market sector industries aggregate
3Productivity growth cycles – Market sector industries aggregate
4Productivity measures – Selected industries aggregate
5Productivity growth cycles – Selected industries aggregate
6Labour productivity indexes
7Capital productivity indexes
8Gross value added chain volume indexes
9Hours worked indexes
10Capital services indexes
11Combined inputs capital and labour indexes
12Productive capital stock chain volume measures – Incorporated and unincorporated
13Capital rental price – Incorporated and unincorporated
14Income shares for value added based estimates of MFP
15Gross output based MFP indexes
16Gross output indexes
17Combined inputs (labour, capital and intermediate inputs) indexes
18Intermediate inputs indexes
19Income shares for gross output based estimates of MFP

More information available from the ABS website.


INQUIRIES

For further information about these and related statistics, contact the National Information and Referral Service on 1300 135 070 or Derek Burnell on Canberra (02) 6252 6427.


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