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ABOUT THIS PUBLICATION

This publication presents the first release of Australian industry estimates from the Economic Activity Survey compiled using new statistical infrastructure. Estimates have been compiled on this new basis for each of 2001-02 and 2002-03. Effectively, a new statistical series has commenced with the 2001-02 collection.

The new infrastructure was described in Information Paper: Improvements in ABS Economic Statistics [Arising from The New Tax System] (cat. no. 1372.0), released by the Australian Bureau of Statistics (ABS) on 6 May 2002. The paper described a number of changes to the infrastructure supporting the compilation of ABS economic series. The changes make better use of data available from the taxation system to improve the efficiency, coverage and sample design of the surveys from which these series are sourced. This new statistical infrastructure has led to significant improvements in survey methodology and greater consistency in estimates.

To facilitate comparisons over time, the effects of the infrastructure and certain other changes on the statistics have been measured, by showing data on both bases for 2000-01. Details on the size of these effects can be found in Appendix 1.

Some of the estimates in this publication are derived by prorating data from taxation sources with data collected by the ABS. Due to the complexity of this estimation process, the ABS's current methods of measuring standard error may underestimate the variability of the estimates. For details, see Technical Note 2.

CHANGES TO THIS PUBLICATION

The scope of the new basis series in this publication has been changed by:

• inclusion of AGRICULTURE, FORESTRY AND FISHING (Australian and New Zealand Standard Industrial Classification (ANZSIC) Division A), from 2002-03; and (private) EDUCATION (part of ANZSIC Division N), COMMUNITY SERVICES (ANZSIC Subdivision 87) and OTHER SERVICES (ANZSIC Subdivision 96)
• exclusion of SERVICES TO FINANCE AND INSURANCE (ANZSIC Subdivision 75) from all years shown (although data for this subdivision are available on request).

This publication also includes data items which were previously included in Business Operations and Industry Performance, Australia, 2000-01 (cat. no. 8140.0)(final issue). However, employment estimates (and related ratios) have not been included in this issue. See Explanatory Notes paragraph 32 for details.

CANCELLATION OF 2001-02 ISSUE

This publication contains previously unpublished information for Australian industry for both 2001-02 and 2002-03. This is because the scheduled 2001-02 issue of this publication was not produced, due to delays caused by the introduction of the new statistical infrastructure mentioned above.

INQUIRIES

For further information about these and related statistics, contact the National Information and Referral Service on 1300 135 070 or John Ridley on Sydney (02) 9268 4541.

CHAPTER 1 SUMMARY, 2000-01 TO 2002-03



INTRODUCTION

The introduction of the New Tax System (TNTS) has had a number of significant implications for ABS statistics. Most of these changes affected the ABS Business Register (ABSBR) and, therefore, all ABS business collections which draw their populations from it. These changes have resulted in the adoption of a new statistical infrastructure. To help bridge the series, data are presented for 2000-01 on an old and a new basis in Table 1.1.

Data shown on the 'old basis' reflect the 2000-01 collection where data were collected from what the ABS refers to as management units. The 'new basis' data reflect the new ABN unit / TAU based collections for 2001-02 and 2002-03. The 'new basis' data also provide revised estimates for 2000-01, calculated as though the 2000-01 collection had been conducted on the same basis as the 2001-02 and 2002-03 collections.

For more information, see Explanatory Notes paragraphs 5-10 and Appendix 1. The Glossary provides definitions for terms used.

DETAILED COMMENTARY

Please see:

• Industry performance: Chapter 2
• Experimental estimates, 2002-03: Chapter 3.

CHAPTER 2 INDUSTRY PERFORMANCE



SUMMARY OF SCOPE

The EDUCATION and HEALTH AND COMMUNITY SERVICES industries, where shown (or included in totals) in this publication, exclude any public sector components. Also, TOTAL SELECTED INDUSTRIES comprises all industries shown but excludes ANZSIC Divisions K FINANCE AND INSURANCE and M GOVERNMENT ADMINISTRATION AND DEFENCE. To assist users, any year-to-year comparisons are based on 'SELECTED INDUSTRIES (EXCLUDING AGRICULTURE, FORESTRY AND FISHING)', as data for AGRICULTURE, FORESTRY AND FISHING are only available from 2002-03. Where commentary relates only to 2002-03, the data shown are based on the TOTAL SELECTED INDUSTRIES estimates. For details of the scope of the data presented in this publication, see Explanatory Notes paragraphs 11-13.

Definitions of terms used are shown in the Glossary.

OPERATING BUSINESSES

The total number of businesses operating in the SELECTED INDUSTRIES (EXCLUDING AGRICULTURE, FORESTRY AND FISHING) component of the Australian economy increased by 3% between 2001-02 and 2002-03. In 2002-03, these industries consisted of 1,919,024 operating businesses, 61,748 more than in 2001-02. In 2002-03, with the inclusion of the AGRICULTURE, FORESTRY AND FISHING industry, the total number of operating businesses was 2,149,959.

Refer to Explanatory Notes paragraphs 5-10 for detailed descriptions of the business units used.

Of the fourteen industries included in these statistics for both years, the number of operating businesses declined between 2001-02 and 2002-03 in four of them (although none of the decreases exceeded 2%). Industries which experienced the largest percentage increases in the number of operating businesses were ELECTRICITY, GAS AND WATER SUPPLY (16%), (private) EDUCATION (10%), and PROPERTY AND BUSINESS SERVICES (8%). The greatest increases in the number of operating businesses occurred in PROPERTY AND BUSINESS SERVICES (42,051), MANUFACTURING (9,135), and PERSONAL AND OTHER SERVICES (4,257).

In 2002-03, the industries with the largest number of operating businesses were PROPERTY AND BUSINESS SERVICES (with 596,178 businesses, or 28% of TOTAL SELECTED INDUSTRIES), CONSTRUCTION (16%), AGRICULTURE, FORESTRY AND FISHING (11%), and RETAIL TRADE (10%).

TOTAL INCOME AND TOTAL EXPENSES

For SELECTED INDUSTRIES (EXCLUDING AGRICULTURE, FORESTRY AND FISHING), total income increased in current price terms by $126.9b (8%) between 2001-02 and 2002-03, to $1,640.3b. Of this increase, sales of goods accounted for $67.7b and income from services (excluding rent, leasing and hiring income) $50.2b. In percentage terms, the largest increase (21%) was in interest income (from $13.2b to $15.9b). The total income of large (employing) businesses increased by $38.2b (6%), while for other business types it increased by $88.7b (10%). Apart from the PERSONAL AND OTHER SERVICES industry, which registered a very small decrease of $0.3b (1%), all other industries increased total income in current price terms, the largest percentage increase (14%) having occurred in the CONSTRUCTION industry.

Total expenses for SELECTED INDUSTRIES (EXCLUDING AGRICULTURE, FORESTRY AND FISHING) increased in current price terms by $119.3b (9%) between 2001-02 and 2002-03, to $1,517.7b. Of this increase, cost of sales accounted for $88.4b and labour costs $18.0b. The increase among large (employing) businesses amounted to $35.7b (6%), while for other business types total expenses increased by $83.5b (10%). Most industries recorded an increase in total expenses in current price terms; the exception was again the PERSONAL AND OTHER SERVICES industry, where total expenses declined marginally (by 0.3%). The largest percentage increase, of 16%, occurred in the PROPERTY AND BUSINESS SERVICES industry and the (private) EDUCATION industry. The PROPERTY AND BUSINESS SERVICES industry also incurred the largest increase in value of total expenses (up $24.9b). Other industries for which total expenses increased substantially were WHOLESALE TRADE (up $21.4b) and RETAIL TRADE (up $17.4b).

In 2002-03, the industry with the largest share of total income for TOTAL SELECTED INDUSTRIES was MANUFACTURING, with 19%, followed by WHOLESALE TRADE (18%) and RETAIL TRADE (16%). A similar pattern is evident in relation to total expenses, where these three industries represent 19%, 19% and 17% (respectively).

The percentage contribution of large (employing) businesses to total income of TOTAL SELECTED INDUSTRIES was 37% in 2002-03, and 38% to total expenses. Small (employing) businesses contributed 28% and 27% (respectively) in 2002-03, medium (employing) businesses 24% and 25%, and non-employing businesses 11% and 9%.

OPERATING PROFIT BEFORE TAX

Operating profit before tax (OPBT) earned by SELECTED INDUSTRIES (EXCLUDING AGRICULTURE, FORESTRY AND FISHING) businesses in 2002-03 was $131.2b, an increase in current price terms of $12.9b (11%) from 2001-02.

In 2002-03, OPBT for large (employing) businesses in SELECTED INDUSTRIES (EXCLUDING AGRICULTURE, FORESTRY AND FISHING) was $40.4b, an increase of $3.9b (11%) from 2001-02. For other business types, OPBT increased by $9.0b, or 11%, from $81.8b in 2001-02 to $90.8b in 2002-03.

In percentage terms, the largest increase between 2001-02 and 2002-03 in OPBT occurred in the CULTURAL AND RECREATIONAL SERVICES industry (35%), followed by MINING (26%), COMMUNICATION SERVICES (24%), CONSTRUCTION (23%) and WHOLESALE TRADE (22%). Of the fourteen industry divisions included in these statistics for both years, OPBT increased in ten and declined in four.

In 2002-03, 30% of OPBT of TOTAL SELECTED INDUSTRIES was earned by large (employing) businesses. Small (employing) businesses generated 29%, medium (employing) businesses 15%, and 26% was attributable to non-employing businesses. Non-employing businesses make a higher contribution to OPBT (26% of total OPBT for TOTAL SELECTED INDUSTRIES) than to most of the other variables presented. However, it should be noted that much of this profit represents the OPBT of sole proprietors and partnerships, which comprise a high proportion of non-employing businesses. The drawings and/or labour costs of these persons are not reflected in estimates of business expenses but are treated as drawings from profits, and as such are not reflected in the estimates.

The PROPERTY AND BUSINESS SERVICES industry was the largest contributor to OPBT of TOTAL SELECTED INDUSTRIES in 2002-03, accounting for 21%. This was followed by MANUFACTURING (16%), and MINING (12%).

TOTAL ASSETS AND TOTAL LIABILITIES

Between 2001-02 and 2002-03, total assets, total liabilities and net worth at the SELECTED INDUSTRIES (EXCLUDING AGRICULTURE, FORESTRY AND FISHING) level all increased by 11%.

Most industries increased total assets and total liabilities. In percentage terms, three industries shared the largest increase (22%) in the value of total assets: CONSTRUCTION, TRANSPORT AND STORAGE, and (private) EDUCATION. COMMUNICATION SERVICES was the only industry to experience a decrease in both total assets (by 4%) and total liabilities (by 11%) in 2002-03. The MINING industry recorded the only other decrease in liabilities, of 3%.

The PROPERTY AND BUSINESS SERVICES industry contributed 29% of the value of total assets and 28% of the value of total liabilities held by TOTAL SELECTED INDUSTRIES, followed by MANUFACTURING (14% of each).

GROSS FIXED CAPITAL FORMATION

Gross fixed capital formation (GFCF) for SELECTED INDUSTRIES (EXCLUDING AGRICULTURE, FORESTRY AND FISHING) increased by 29% between 2001-02 and 2002-03, rising by $13.1b to $58.6b in 2002-03. This overall increase is the net effect of a very wide range of movements in individual industries.

The largest percentage increase (266%) was recorded in the PROPERTY AND BUSINESS SERVICES industry, GFCF of which rose from $2.8b in 2001-02 to $10.1b in 2002-03.

Substantial percentage increases in GFCF were also recorded in the RETAIL TRADE and MINING industries (89% and 67% respectively). The ACCOMMODATION, CAFES AND RESTAURANTS industry recorded the largest percentage decrease (51%), followed by CULTURAL AND RECREATIONAL SERVICES (25%).

The largest sources of GFCF in 2002-03 were with PROPERTY AND BUSINESS SERVICES and MINING (each with 17% of the total for TOTAL SELECTED INDUSTRIES) and MANUFACTURING (15%).

INDUSTRY VALUE ADDED

Industry value added (IVA) for SELECTED INDUSTRIES (EXCLUDING AGRICULTURE, FORESTRY AND FISHING) increased by 8%, or $33.9b, between 2001-02 and 2002-03. All industries recorded increases in current price terms in IVA between these years, except for PERSONAL AND OTHER SERVICES (down 1%). CONSTRUCTION recorded the largest percentage increase (16%), from $33.4b to $38.8b. MANUFACTURING recorded the largest increase in dollar terms ($8.3b), from $81.1b to $89.4b.

As measured by IVA, the largest industries in 2002-03 were MANUFACTURING and PROPERTY AND BUSINESS SERVICES, each with 18% of the total for TOTAL SELECTED INDUSTRIES, followed by RETAIL TRADE (9%).

In 2002-03, large (employing) businesses produced 39% of the IVA of TOTAL SELECTED INDUSTRIES. Small (employing) businesses contributed 29%, medium (employing) businesses 23%, and non-employing businesses 10%.

BUSINESS AVERAGES

Between 2001-02 and 2002-03 for SELECTED INDUSTRIES (EXCLUDING AGRICULTURE, FORESTRY AND FISHING), the average value of sales and service income, total income and total expenses all increased by 5%, and average operating profit before tax (OPBT) increased by 7%. Likewise, average values of total assets and net worth both rose by 7%. The average for industry value added also showed an increase, of 4%.

INDUSTRY RATIOS

Very small increases were recorded between 2001-02 and 2002-03 in profit margin and interest coverage at the SELECTED INDUSTRIES (EXCLUDING AGRICULTURE, FORESTRY AND FISHING) level. Rates of return on assets and on net worth, the ratio of long term debt to equity and the current ratio were all stable. However, the investment rate value added increased by 10% (from 17.4% to 19.1%).

The industry which recorded the greatest profit margin in 2002-03 was MINING (25%), and the smallest profit margin was recorded by RETAIL TRADE (3%). CONSTRUCTION is the industry showing the highest return on assets (17%) for 2002-03, with ELECTRICITY, GAS AND WATER SUPPLY having the lowest (3%). Similarly, rates of return on net worth for 2002-03 ranged from 54% for CONSTRUCTION to 6% for ELECTRICITY, GAS AND WATER SUPPLY.

The industry which recorded the greatest investment rate value added for 2002-03 was ELECTRICITY, GAS AND WATER SUPPLY (41.0%), with the lowest recorded by CONSTRUCTION (7.7%). Between 2001-02 and 2002-03, for SELECTED INDUSTRIES (EXCLUDING AGRICULTURE, FORESTRY AND FISHING), eight industries recorded an increase in this rate while six industries recorded a decrease. The industries with the largest percentage increases were PROPERTY AND BUSINESS SERVICES (up 48% from 14.9% to 22.0%) and MINING (up 37% from 27.8% to 37.9%). CONSTRUCTION (down 35% from 11.9% to 7.7%) and CULTURAL AND RECREATIONAL SERVICES (down 30% from 22.8% to 15.9%) were the industries to record the largest percentage decreases.

BUSINESS PROFITABILITY

For TOTAL SELECTED INDUSTRIES, 71% of businesses were profitable in 2002-03. The proportion was 73% with AGRICULTURE, FORESTRY AND FISHING excluded, which is a decrease from the figure of 75% recorded in 2001-02. The proportion of businesses making a profit in 2002-03 ranged from 84% in the CONSTRUCTION industry to 48% in MINING. MINING was also the industry with the highest percentage (17%) of businesses reporting a break-even result for 2002-03. The industry in which the highest proportion of businesses recorded a loss in 2002-03 was AGRICULTURE, FORESTRY AND FISHING, at 45%.

INDUSTRY LEVEL ANALYSIS

An analysis of performance by industry follows.

AGRICULTURE, FORESTRY AND FISHING

This industry was not included in these statistics for 2001-02. In 2002-03, it consisted of 230,935 operating businesses, contributing 3% of total income, total expenses and industry value added, and 5% of total assets, for TOTAL SELECTED INDUSTRIES. This industry's average values of sales and service income, total income, total expenses, OPBT and IVA are all lower than for all other industries except for PERSONAL AND OTHER SERVICES; the AGRICULTURE, FORESTRY AND FISHING average IVA is the lowest of all industries.

AGRICULTURE, FORESTRY AND FISHING is the industry least dominated by large (employing) businesses, which accounted for only 4% of its total income, 6% of wages and salaries and 3% of IVA in 2002-03. The contributions of small (employing) businesses to these aggregates were, respectively, 57%, 60%, and 62%, the highest for each data item for any industry shown.

MINING

Between 2001-02 and 2002-03, the MINING industry's total income increased by 12% and total expenses rose by 7%.

MINING is the industry for which depreciation and amortisation represents the second highest proportion (after COMMUNICATION SERVICES) of total expenses: 14% in 2001-02 and 15% in 2002-03, compared to 4% overall for both 2001-02 and 2002-03 (irrespective of the inclusion of AGRICULTURE, FORESTRY AND FISHING for 2002-03).

MINING is also the industry to which non-employing businesses made the least contribution in 2002-03 (4% or less for all financial data items shown).

MANUFACTURING

The number of operating business in MANUFACTURING increased by 9,135, or 7%, from 2001-02 to 2002-03. Total income and total expenses both rose by 6%. An increase of 112% in the value of change in inventories contributed to an increase in OPBT of 13%.

The MANUFACTURING industry accounted for 19% of both total income and total expenses of TOTAL SELECTED INDUSTRIES in 2002-03, and was the largest contributor of any industry.

The business averages for MANUFACTURING recorded little change in 2002-03 compared to their values in 2001-02.

ELECTRICITY, GAS AND WATER SUPPLY

Total income in the ELECTRICITY, GAS AND WATER SUPPLY industry increased by 11% in 2002-03, and total expenses increased by 14%. OPBT fell by 13%. Despite a 9% increase in capital expenditure, GFCF declined by 6%.

Labour costs represent 9% of total expenses in 2002-03 for the ELECTRICITY, GAS AND WATER SUPPLY industry, the second lowest proportion (after WHOLESALE TRADE) of any industry. This industry also has the highest proportion of its total expenses represented by interest expenses: 12% in 2002-03, compared to 3% for TOTAL SELECTED INDUSTRIES.

This industry is the second most heavily dominated (after COMMUNICATION SERVICES) by large (employing) businesses in 2002-03, as measured by their contribution to IVA (78%), OPBT (66%), and total income (69%).

ELECTRICITY, GAS AND WATER SUPPLY (at 92%) had the highest proportion of its value of total assets represented by non-current assets in 2002-03, as compared to the 67% proportion for TOTAL SELECTED INDUSTRIES. Similarly, non-current liabilities constitute 79% of total liabilities in ELECTRICITY, GAS AND WATER SUPPLY, compared to 50% overall.

CONSTRUCTION

The number of operating businesses in the CONSTRUCTION industry declined by 1% in 2002-03.

Total income and total expenses in CONSTRUCTION both rose by 14% and OPBT by 23%, in 2002-03. An increase of 36% in net worth was also recorded.

Rates of return (on assets and net worth) for this industry in 2002-03 were the highest of any industry. These figures were 17.1% and 54.1% (respectively), compared to the corresponding TOTAL SELECTED INDUSTRIES figures of 7.1% and 16.8%.

CONSTRUCTION is the industry in which IVA was most heavily dominated by non-employing businesses in 2002-03. They contributed 22% of total IVA for the industry.

WHOLESALE TRADE

In 2002-03, WHOLESALE TRADE recorded an increase of 2% in the number of operating businesses.

Total income and total expenses in the WHOLESALE TRADE industry both increased by 8% in 2002-03. OPBT increased by 22%.

Between 2001-02 and 2002-03, the WHOLESALE TRADE industry's total assets, total liabilities and net worth all increased by 14%.

WHOLESALE TRADE had the highest proportion of its value of total assets represented by current assets in 2002-03 (69%), which is more than double the proportion (33%) for TOTAL SELECTED INDUSTRIES. Similarly, current liabilities constitute 78% of total liabilities in WHOLESALE TRADE, compared to 50% overall.

At 8%, the proportion of labour costs to total expenses for WHOLESALE TRADE was the lowest of all industries in 2002-03. The proportion for TOTAL SELECTED INDUSTRIES is 17%.

In 2002-03, medium (employing) businesses contributed 32% of OPBT in WHOLESALE TRADE, the highest proportion of any industry.

RETAIL TRADE

The number of operating businesses in the RETAIL TRADE industry was virtually unchanged between 2001-02 and 2002-03.

Total income and total expenses in the RETAIL TRADE industry both increased by 7% in 2002-03. OPBT increased by 1%.

The average values of sales and service income, total income, total expenses and IVA for RETAIL TRADE all increased by 7% in 2002-03.

As is the case for the WHOLESALE TRADE industry, RETAIL TRADE's share of the value of current assets as a proportion of total assets is, at 55% in 2002-03, substantially greater than the proportion for TOTAL SELECTED INDUSTRIES. Likewise, 69% of total liabilities in RETAIL TRADE are current.

ACCOMMODATION, CAFES AND RESTAURANTS

The number of operating businesses in the ACCOMMODATION, CAFES AND RESTAURANTS industry increased by 2% in 2002-03.

Increases of 4% were recorded in this industry's total income and total expenses in 2002-03. OPBT increased by 6%. A slight decline in the value of total assets (by 1%) and a 13% increase in total liabilities combined to reduce net worth by 19%. These movements are also reflected in decreases in the average values for total assets and net worth.

TRANSPORT AND STORAGE

Between 2001-02 and 2002-03, the number of operating businesses in the TRANSPORT AND STORAGE industry decreased by 1% to 115,729. Total income and total expenses both rose by 6% in 2002-03. Capital expenditure increased by 24% and GFCF by 27%. OPBT declined by 7%.

The value of total assets and total liabilities in this industry rose by 22% and 17% respectively in 2002-03. TRANSPORT AND STORAGE (at 80%) is the industry for which the value of its non-current assets represents the second highest proportion (after ELECTRICITY, GAS AND WATER SUPPLY) of the value of its total assets.

COMMUNICATION SERVICES

In 2002-03, the COMMUNICATION SERVICES industry experienced a 2% decrease in the number of operating businesses.

Total income of the industry in 2002-03 increased by 5% and total expenses by 3%. OPBT increased by 24%.

A greater proportionate reduction (of 11%) in total liabilities compared to the decrease in the value of total assets (4%) resulted in an increase (of 7%) in the net worth of the COMMUNICATION SERVICES industry in 2002-03.

COMMUNICATION SERVICES is the industry in which large (employing) businesses dominate most heavily, generating 82% of total income, 90% of IVA and 91% of OPBT in 2002-03. COMMUNICATION SERVICES is also the industry for which depreciation and amortisation represents the highest proportion of total expenses, at 16% in 2002-03.

PROPERTY AND BUSINESS SERVICES

The PROPERTY AND BUSINESS SERVICES industry had, by far, the most operating businesses in 2002-03. At 596,178 operating businesses, this represents 28% of TOTAL SELECTED INDUSTRIES businesses, and is an 8% increase (42,051 businesses) on the figure for 2001-02.

Total income of the PROPERTY AND BUSINESS SERVICES industry increased in 2002-03 by 12% and total expenses increased by 16%. OPBT increased by 3%.

The value of total assets increased by 17% and total liabilities by 21% in 2002-03. Capital expenditure was 53% higher than in 2001-02.

In 2002-03, the PROPERTY AND BUSINESS SERVICES industry accounted for 13% of total income, 12% of total expenses, 20% of labour costs and 29% of the value of total assets for TOTAL SELECTED INDUSTRIES. This proportion of labour costs, which represents expenditure of $54.0b, is the highest of any industry.

Of total income for this industry in 2002-03, 14% is represented by rent, leasing and hiring income, which is also the highest proportion of any industry. At the TOTAL SELECTED INDUSTRIES level, the corresponding proportion is 2%. The PROPERTY AND BUSINESS SERVICES industry contributes 71% of the total rent, leasing and hiring income earned by TOTAL SELECTED INDUSTRIES.

Non-employing businesses accounted for 26% of the total income of the PROPERTY AND BUSINESS SERVICES industry and 53% of its OPBT, the highest proportions of any industry in 2002-03.

EDUCATION (PRIVATE)

The number of operating businesses in the (private) EDUCATION industry increased by 10% between 2001-02 and 2002-03. In the same period, total income increased by 13% and total expenses by 16%, producing a fall of 23% in OPBT. These movements are also reflected in reduced profit margin, average profit and rates of return.

Labour costs represented 60% of total expenses for the (private) EDUCATION industry in 2002-03, the highest proportion of any industry. The proportion in 2001-02 was 63%.

The value of total assets and total liabilities in this industry both increased in 2002-03, by 22% and 26% respectively.

(Private) EDUCATION is the industry in which medium (employing) businesses are most dominant in terms of total income and IVA, contributing 45% and 49% respectively of the estimates for this industry.

HEALTH AND COMMUNITY SERVICES (PRIVATE)

This industry recorded an increase of 2% in the number of operating businesses during 2002-03. Total income increased by 12%, total expenses by 11%, and OPBT by 17%.

The cost structure of the (private) HEALTH AND COMMUNITY SERVICES industry is distinctive in that labour costs and cost of sales are very similar, each constituting 47% of total expenses in both 2001-02 and 2002-03.

CULTURAL AND RECREATIONAL SERVICES

The number of operating businesses in the CULTURAL AND RECREATIONAL SERVICES industry rose by 5% in 2002-03.

In 2002-03, total income and total expenses increased by 8% and 6% respectively. OPBT increased by 35%. Capital expenditure decreased by 25%, as did GFCF.

Large (employing) businesses in the CULTURAL AND RECREATIONAL SERVICES industry accounted for 62% of its OPBT in 2002-03.

Apart from a 28% rise in average OPBT, the business averages for this industry showed only slight increases between 2001-02 and 2002-03.

PERSONAL AND OTHER SERVICES

The number of operating businesses in the PERSONAL AND OTHER SERVICES industry increased by 4% in 2002-03.

Of this industry's OPBT in 2002-03, 48% was generated by non-employing businesses.

Between 2001-02 and 2002-03, this industry recorded declines in total income and IVA (both 1%), in OPBT (9%) and in all business averages and industry ratios presented, with the exception of long term debt to equity (which stayed the same). Total liabilities increased by 10% and the value of total assets was virtually unchanged, leading to a 6% decline in net worth.

CHAPTER 3 EXPERIMENTAL ESTIMATES 2002-03



INTRODUCTION

This Chapter presents a selection of experimental estimates using detailed results from the collection in:

• table 3.1, which provides statistics to the ANZSIC class level for selected data items
• table 3.2, which provides a state and territory dissection of these data items at the industry division level.

Note that the estimates are also subject to non-sampling error, which is discussed in Technical Note 2. All industry codes shown are from the Australian and New Zealand Standard Industrial Classification (ANZSIC) (cat. no. 1292.0). Definitions of terms used are shown in the Glossary.

INDUSTRY SUBDIVISIONS

The largest industry subdivision in terms of total income in 2002-03 was BUSINESS SERVICES (Subdivision 78), which earned $143.7b, or 8% of total income for TOTAL SELECTED INDUSTRIES. All of the three next largest are in the WHOLESALE TRADE or RETAIL TRADE ANZSIC divisions:

• PERSONAL AND HOUSEHOLD GOOD WHOLESALING (Subdivision 47) ($110.5b, or 7%)
• PERSONAL AND HOUSEHOLD GOOD RETAILING (Subdivision 52) ($108.3b, or 6%)
• MACHINERY AND MOTOR VEHICLE WHOLESALING (Subdivision 46) ($98.5b, or 6%).

• PROPERTY SERVICES (Subdivision 77), with $16.0b, or 12% of total OPBT for TOTAL SELECTED INDUSTRIES
• BUSINESS SERVICES (Subdivision 78)($12.6b, or 9%)
• OIL AND GAS EXTRACTION (Subdivision 12)($8.6b, or 6%)
• CONSTRUCTION TRADE SERVICES (Subdivision 42)($8.2b, or 6%).

• (Private) HEALTH SERVICES (Subdivision 86)($13.1b, or 5%)
• PERSONAL AND HOUSEHOLD GOOD RETAILING (Subdivision 52)($12.8b, or 5%)
• MACHINERY AND EQUIPMENT MANUFACTURING (Subdivision 28)($10.7b, or 4%).

• SUPERMARKET AND GROCERY STORES (Class 5110)($51.3b, or 3% of total income for TOTAL SELECTED INDUSTRIES)
• CAR RETAILING (Class 5311)($42.8b, or 3%)
• ELECTRICITY SUPPLY (Class 3610)($32.5b, or 2%)
• TELECOMMUNICATION SERVICES (Class 7120)($32.0b, or 2%).

• OIL AND GAS EXTRACTION (Class 1200)($8.6b, or 6%)
• COMMERCIAL PROPERTY OPERATORS AND DEVELOPERS (Class 7712)($8.6b, or 6%)
• TELECOMMUNICATION SERVICES (Class 7120)($5.2b, or 4%)
• LEGAL SERVICES (Class 7841)($4.0b, or 3%).

• COMPUTER CONSULTANCY SERVICES (Class 7834)($5.5b, or 2% of wages and salaries of TOTAL SELECTED INDUSTRIES)
• SUPERMARKET AND GROCERY STORES (Class 5110)($5.4b, or 2%)
• BUSINESS MANAGEMENT SERVICES (Class 7855)($4.6b, or 2%)
• TELECOMMUNICATION SERVICES (Class 7120)($4.5b, or 2%).

Measured by share of total income, MANUFACTURING was the largest industry in 2002-03 in five of the eight states and territories (Victoria, Queensland, South Australia, Western Australia, and Tasmania), with WHOLESALE TRADE, MINING and RETAIL TRADE predominating in one state or territory each (respectively, New South Wales, Northern Territory and the Australian Capital Territory). The PROPERTY AND BUSINESS SERVICES industry was the major source of OPBT in four states and territories (New South Wales, Victoria, Queensland and the Australian Capital Territory), MANUFACTURING in two (South Australia and Tasmania), and MINING in the remaining two (Western Australia and the Northern Territory).

Each state or territory is dominated by its major industry to a different degree. In terms of total income, the predominance of a particular industry is greatest in South Australia, where MANUFACTURING contributes 24%. This is followed by Tasmania and the Australian Capital Territory, where the major industry accounts for 23% of total income. The Northern Territory is least heavily dominated (at 16%) by its major industry. Western Australia is the most industrially concentrated state or territory in terms of industries' shares of OPBT, its major industry (MINING) generating 41% of the state's OPBT. Similarly, MINING contributes 39% of OPBT in the Northern Territory. By contrast, the main sources of OPBT in Queensland and South Australia each contribute only 17% of OPBT for their respective states.