NOTES


INTRODUCTION

This release presents statistics on Research and Experimental Development (R&D) undertaken by Australian higher education institutions in respect of the calendar year ended 31 December 2008. These statistics, as well as time series data, are also available in spreadsheet format (data cubes); see the Downloads page for this issue (cat. no. 8111.0) on the ABS website <www.abs.gov.au>.

Users should refer to the Explanatory and Technical Notes for further contextual information when interpreting the statistics.


CHANGES IN THIS ISSUE

For the first time, field of research and socio-economic objective data presented in this issue have been collected and compiled based on the Australian and New Zealand Standard Research Classification (ANZSRC), 2008 (cat. no. 1297.0). Previous issues used the Australian Standard Research Classification (ASRC).

Previous cycle estimates have not been recompiled using the new classification. As such, field of research and socio-economic objective tables present current cycle data only and on an ANZSRC basis. However, previous cycle data are available in the data cubes on an ASRC basis.


DATA QUALITY

When interpreting the results in this release it is important to take into account factors that may affect the reliability of estimates. These factors are described in the Non-sampling error section of the Technical Note.

Users are also advised to exercise caution if comparing estimates over time. Factors impacting comparability of estimates include:

• improved record keeping by higher education institutions in 2008;
• changes in the research classification used; and
• revisions to 2006 estimates.

Refer to the Revisions and Comparability of Estimates Over Time sections of the Technical Note for further details.


ACKNOWLEDGEMENT

The ABS acknowledges the continued effort and contribution of higher education institutions in providing data for the compilation of statistics presented in this and previous issues.


INQUIRIES

For further information about these and related statistics, contact the National Information and Referral Service on 1300 135 070 or Fiona Manson on Perth (08) 9360 5213.


SUMMARY COMMENTARY


RESOURCES DEVOTED TO RESEARCH AND EXPERIMENTAL DEVELOPMENT (R&D)

During the 2008 calendar year, expenditure on R&D by Australian higher education institutions was $6,717 million. Over the same period, human resources devoted to R&D by these institutions represented 61,310 person years of effort (PYE).

Higher education resources devoted to R&D
			1998	2000	2002	2004	2006	2008
Expenditure on R&D
	Current prices	$m	2 555	2 790	3 430	4 327	r5 434	6 717
	Chain volume measures(a)	$m	3 433	3 626	4 177	4 901	5 709	6 717
Human resources devoted to R&D		PYE	45 502	46 287	49 612	55 204	r58 905	61 310
r revised
(a) The reference year for chain volume measures is 2008. See Explanatory Notes 18 and 19 for details.

EXPENDITURE ON R&D

In 2008, higher education expenditure on R&D (HERD) showed an increase of 24% in current price terms over 2006 and 18% in chain volume terms. This compares to average increases of 21% and 14% respectively, since the 1998 reference period.

Subsequent expenditure figures and supporting commentary relate to current price terms.


HERD and gross domestic product (GDP)

HERD as a proportion of GDP increased from 0.50% in 2006 to 0.53% in 2008.

The following table shows HERD/GDP ratios for Organisation for Economic Co-operation and Development (OECD) countries.

HERD/GDP ratios of OECD countries(a)(b)(c)
	2004	2005	2006	2007	2008
	%	%	%	%	%
Sweden	0.83	0.79	0.77	0.77	0.80
Denmark	0.61	0.61	0.64	0.68	0.71
Iceland	na	0.61	0.71	0.68	0.67
Finland	0.68	0.66	0.65	0.65	0.66
Canada	0.70	0.69	0.66	0.67	0.64
Switzerland	0.67	na	0.66	na	na
Austria	0.60	0.61	0.60	0.61	na
Netherlands	0.52	0.54	0.53	0.52	na
Australia	0.47	na	0.50	na	0.53
Norway	0.47	0.47	0.46	0.52	0.51
Portugal	0.28	0.29	0.33	0.36	0.51
United Kingdom	0.42	0.45	0.46	0.47	0.47
Japan	0.43	0.45	0.43	0.43	na
Germany	0.41	0.41	0.41	0.41	na
Belgium	0.40	0.41	0.40	0.40	0.41
France	0.40	0.40	0.40	0.40	0.40
New Zealand	na	0.38	na	0.36	na
Italy	0.36	0.33	0.34	0.36	0.39
Ireland	0.33	0.34	0.34	0.35	0.39
United States of America	0.37	0.36	0.35	0.35	0.36
Turkey	0.35	0.32	0.30	0.35	na
Korea	0.27	0.28	0.30	0.34	na
Spain	0.31	0.33	0.33	0.33	0.36
Greece	0.27	0.28	0.28	0.29	na
Czech Republic	0.18	0.23	0.25	0.26	0.25
Hungary	0.21	0.24	0.24	0.23	na
Poland	0.18	0.18	0.17	0.19	0.20
Slovak Republic	0.10	0.10	0.12	0.12	0.11
Mexico	0.12	0.12	0.10	0.10	na
Luxembourg	0.02	0.02	0.04	0.05	0.05
Total OECD	0.39	0.39	0.38	0.39	na
na not available
(a) Except for Australia, the HERD/GDP ratios shown for OECD countries are sourced from Main Science and Technology Indicators, 2009/2, OECD. Ratios for Australia have been calculated using the most recent ABS values for HERD and GDP. See Explanatory Notes 15 to 17.
(b) HERD/GDP ratios for some countries are projected or estimated as per the OECD source table.
(c) Countries are ranked by the most recent available HERD/GDP ratio.

Type of expenditure

In 2008, HERD was comprised of $6,051 million in Current expenditure and $666 million in Capital expenditure. The largest component of HERD in 2008 was Other current expenditure, which totalled $2,930 million (44% of HERD).


Source of funds

The main source of funds for HERD in 2008 was General university funds ($3,523 million or 52% of HERD) and Australian competitive research grants ($1,181 million or 18%). These were also the major sources of funds in 2006.

State and local government was the only source of funds with a change in its relative share of HERD of more than two percentage points; this resulted from a 91% increase in funds from this source directed to R&D, compared to 2006.


Location

In 2008, higher education institutions based in New South Wales, Victoria and Queensland combined, contributed almost three quarters (72%) of HERD (at $2,015 million, $1,775 million and $1,062 million, respectively). Refer to Explanatory Note 9 for further information regarding the location of R&D.

Between 2006 and 2008, New South Wales recorded the largest growth in HERD in both absolute and percentage terms, rising $450 million or 29%.

South Australia had the highest increase in HERD as a proportion of gross state product (GSP) from 2006. The Northern Territory was the only location to experience a decrease in its HERD/GSP ratio, while ratios for Queensland and Western Australia remained the same.

HERD, by location of expenditure - proportion of GSP(a)
	NSW	Vic.	Qld	SA	WA	Tas.	NT	ACT
	%	%	%	%	%	%	%	%
2008	0.50	0.61	0.44	0.64	0.39	0.56	0.27	2.02
2006	0.44	0.54	0.44	0.55	0.39	0.48	0.29	2.01
(a) See Explanatory Notes 15 to 17 for details

Type of activity

In 2008, 41% of HERD ($2,772 million) was directed towards Applied research, 29% ($1,941 million) to Pure basic research, and 21% ($1,389 million) to Strategic basic research. The remaining 9% of HERD ($615 million) was directed towards Experimental development.


Field of research (FOR)

Expenditure devoted to Medical and health sciences FOR ($2,064 million) represented 31% of HERD in 2008, and was almost triple the value of the next highest FOR, Biological sciences ($689 million). In total, Medical and health sciences, Biological sciences and Engineering FORs made up approximately half of total HERD.


Socio-economic objective (SEO)

Over a third (35% or $2,347) of HERD in 2008 was directed to the SEO of Health, which includes R&D related to the understanding and treatment of clinical diseases and conditions; and the provision of public health services.

At $1,203 million, HERD directed to the next most prevalent SEO of Expanding knowledge was approximately half that directed to Health. This SEO includes R&D that contributes to the general advancement of knowledge without having a specific application.


HUMAN RESOURCES DEVOTED TO R&D

Most higher education human resources devoted to R&D in 2008 were Postgraduate students and Academic staff, accounting for 56% (34,359 PYE) and 31% (18,981 PYE) of total PYE, respectively. The remaining 13% was attributable to Other staff directly supporting R&D.

As with HERD, New South Wales, Victoria and Queensland accounted for almost three quarters (74%) of total human resources devoted to R&D in 2008.

Compared to 2006, human resources devoted to R&D in 2008 was up 4% (from 58,905 PYE). The largest absolute growth was reported for Academic staff (up 1,944 PYE), which was also the only type of human resource to show an increase in its relative share of total PYE (up two percentage points) from 2006.