1301.0 - Year Book Australia, 2004

ARCHIVED ISSUE Released at 11:30 AM (CANBERRA TIME) 27/02/2004

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Contents >> Service industries >> Overview

The service industries sector is the largest component of the Australian economy in terms of number of businesses, employment and gross value added.

Of the estimated 1,164,100 private sector businesses in Australia in 2000-01, some 833,100 (72%) were in the service industries sector. Small businesses (those with less than 20 employees), in the service industries sector accounted for 71% of the 1.1 million small businesses in Australia (table 20.1).

20.1 BUSINESSES - 2000-01
Industries	Units	Small businesses	Other businesses	Total

Goods producing	’000	322.3	8.7	331.0
Service	’000	799.7	33.4	833.1
Total	’000	1,122.0	42.1	1,164.1
Businesses in service industries as a percentage of all businesses	%	71.3	79.3	71.6

Source: Small Business in Australia, 2000-01 (1321.0).

The service industries sector accounted for 68% of the gross value added for all industries in 2001-02, and also showed the greatest increase in output in chain volume terms (measuring 'real' output unaffected by price change), with an increase of 24% over the period from 1996-97 to 2001-02 (table 20.2). In comparison, the goods producing industries recorded an increase of 15% over the same period.

20.2 GROSS VALUE ADDED(a), Chain volume measures(b)
Industries		Units	1996-97	2001-02

Goods producing
	Agriculture, forestry and fishing	$m	18,492	22,119
	Mining	$m	28,858	33,865
	Manufacturing	$m	67,182	75,573
	Electricity, gas and water	$m	14,101	15,226
	Construction	$m	32,696	39,011
	Total	$m	161,329	185,794
Service
	Wholesale trade	$m	29,188	34,714
	Retail trade	$m	28,438	34,646
	Accommodation, cafes and restaurants	$m	12,194	15,350
	Transport and storage	$m	28,270	33,988
	Communication services	$m	14,536	19,814
	Finance and insurance services	$m	35,776	46,943
	Property and business services	$m	56,065	77,162
	Government administration and defence	$m	23,297	25,440
	Education	$m	27,624	30,317
	Health and community services	$m	32,977	40,438
	Cultural and recreational services	$m	9,808	11,821
	Personal and other services	$m	12,701	15,829
	Total	$m	310,874	386,462
Total(c)		$m	472,203	572,256
Service industries as a percentage of all industries		%	65.8	67.5

(a) At basic prices, which include subsidies, but are before any taxes on products. (b) Reference year is 2000-01. (c) Excludes ownership of dwellings.

Source: Australian System of National Accounts (5204.0).

The largest contributor to the service industries sector in 2001-02 was the property and business services industry, which accounted for 20% of the gross value added of the sector and 13% of the gross value added of all industries. The next largest within the service industries sector was finance and insurance services, which accounted for 12% of the gross value added of the sector.

In the five-year period 1996-97 to 2001-02, the gross value added of the services industries sector increased by an average annual rate of 4%, while that of the goods producing industries recorded an average annual growth rate of 3%.

Within the service industries sector, the property and business services industry recorded the largest percentage increase in output in the five-year period (38% in real terms), which is the equivalent of an average annual growth rate of 7%. The next highest growth rate was recorded by the communications industry, with a 36% increase in output over the five-year period, and an average annual growth rate of 6%. The lowest increase in real terms in the service industries sector over the period was by the government administration and defence industry with an increase of 9%.

In terms of employment, the service industries sector remained dominant, accounting for 75% of total employment for all industries in 2002-03 (table 20.3). Total employment in the service industries sector in 2002-03 was 7,046,800 persons.

20.3 EMPLOYED PERSONS

Industries		Units	1997-98(a)	2002-03(a)

Goods producing
	Agriculture, forestry and fishing	’000	430.8	372.4
	Mining	’000	82.7	88.3
	Manufacturing	’000	1,121.2	1,131.4
	Electricity, gas and water	’000	64.4	72.5
	Construction	’000	597.1	729.9
	Total	’000	2,296.2	2,394.5
Service
	Wholesale trade	’000	500.0	449.5
	Retail trade	’000	1,244.0	1,455.8
	Accommodation, cafes and restaurants	’000	402.9	455.0
	Transport and storage	’000	394.2	411.1
	Communication services	’000	148.7	173.7
	Finance and insurance	’000	313.3	351.6
	Property and business services	’000	897.1	1,092.7
	Government administration and defence	’000	339.3	430.2
	Education	’000	583.4	666.1
	Health and community services	’000	799.4	936.3
	Cultural and recreational services	’000	203.4	241.0
	Personal and other services	’000	339.5	383.8
	Total	’000	6,165.2	7,046.8
Total		'000	8,461.4	9,441.3
Service industries as a percentage of all industries		%	72.9	74.6

(a) Annual average of quarterly data.

Source: Labour Force, Australia (6202.0).

In the five-year period from 1997-98, employment in the service industries increased by 881,600 persons or 14%, representing an average annual growth rate of 3%. In the same period the goods producing industries recorded an increase in employment of 98,300 persons. This represented an increase of 4% and an average annual growth rate of just over 0.8%.

Within the service industries sector, the major employing industry was retail trade with employment in 2002-03 of 1,445,800 persons, accounting for 15% of all employment and 21% of total employment in the sector. Other large employing service industries were property and business services (1,092,700 persons), health and community services (936,300 persons), and education (666,100 persons).

The service industries showing the greatest employment growth in the five-year period since 1997-98 were government administration and defence, with a 27% increase from 339,300 persons to 430,200 persons, property and business services with an increase of 22% in the period, and cultural and recreation services with an increase of 18%. The transport and storage sector showed the smallest increase over the five-year period of 4%, while the wholesale trade sector recorded a decrease of 10%.