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INTRODUCTION
1 This publication, Manufacturing Industry, Australia, 2000-01 (cat. no. 8221.0), is the first to present final manufacturing industry data compiled from the 2000-01 collection and where the management unit was the sole statistical unit used to collect data, together with some comparative statistics for preceding years. Prior to the 2000-01 survey, the annual manufacturing collection was primarily based on manufacturing establishments with some information collected from a relatively small sample of manufacturing management units. For more information about these fundamental changes to the annual manufacturing collection and how they affect data outputs, see Appendix 2.
2 Manufacturing, as specified in Division C of the Australian and New Zealand Standard Industrial Classification (ANZSIC), broadly relates to the physical or chemical transformation of materials or components into new products, whether the work is performed by power-driven machines or by hand.
3 The manufacturing collection is conducted on an annual basis. For the 2000-01 collection, a sample of approximately 9,500 manufacturing management units were asked to provide data on employment, wages and salaries, detailed structural and performance data, value of sales for commodities produced, and whether their products were exported. Data on industry value added (IVA) are also available from this collection. Approximately 400 of these management units were also asked for details of their operations by state and territory, enabling the production of the state/territory estimates contained in table 3. The next manufacturing census will be conducted in respect of 2001-02.
SCOPE AND COVERAGE
4 The business unit for which statistics are presented in this publication is the management unit. A manufacturing management unit is one predominantly engaged in manufacturing activities, but the data collected for it cover all activities of the management unit (including non-manufacturing activities). Conversely, there are some management units predominantly engaged in non-manufacturing activities which also undertake limited manufacturing activities; these are excluded from the collection.
5 Some manufacturing management units engage, in a significant way, in activities which are normally carried out by different industries. For example, a predominantly manufacturing management unit may also undertake significant amounts of wholesaling. Similarly, a manufacturing management unit may produce significant volumes of goods which are normally produced in different manufacturing industries. For 2000-01 and prior years, no management units have been 'split' to allocate significant secondary activities in another industry to a separate unit.
6 The statistics in this publication exclude some very small manufacturers. Those excluded are manufacturers not employing staff at 30 June of the reference year (such as sole proprietorships or family partnerships) which had not registered with the Australian Taxation Office's (ATO's) pay as you go withholding (PAYGW) scheme and for years prior to 1 July 2000, its group employer (GE) scheme. Though a substantial number, these businesses would contribute only marginally to aggregate data were they to be included. In addition, the ABS attempts to obtain data for those businesses which ceased operation during the year, but it is not possible to obtain data for all of them.
STANDARD UNITS
7 For the definition of management units and establishments, see the Glossary. However, fundamental changes have been made to the annual manufacturing collection, starting with the 2000-01 survey. For further information, see Appendix 2.
RELIABILITY OF ESTIMATES
8 For information on this subject, see Technical Note 1.
DATA ADJUSTED
9 The annual manufacturing industry collection, like most ABS economic collections, takes its frame from the ABS business register. The register provides a list of employing businesses and is primarily based on registrations to the ATO’s PAYGW scheme (and prior to 1 July 2000, its GE scheme). The register is updated regularly to take account of new businesses, businesses which have ceased employing, changes in employment levels, changes in industry and other general business changes.
10 Businesses which have ceased employing are identified when the ATO cancels their PAYGW registration (or previously their GE registration). In addition, from 1998-99, businesses which did not remit under the GE scheme for the previous five quarters were removed from the register. A similar process has been adopted to remove businesses from the register which do not remit under the PAYGW scheme.
11 This process of using the ATO's GE information to delete businesses from the ABS business register was introduced for the 1998-99 manufacturing survey. The result was that a large number of businesses were removed from the business register and, therefore, from the population for the 1998-99 manufacturing survey. Estimates for the previous three manufacturing surveys (covering 1995-96 to 1997-98 inclusive) were slightly adjusted in such a way as to phase in the impact over this time. For periods before 1995-96, the impact is estimated to have been negligible.
12 The same process for removing businesses from the ABS business register has occurred for the 1999-2000 (GE information) and 2000-01 (PAYGW information) collections. The impact of the ongoing process is estimated to be negligible.
13 The introduction of The New Tax System has had a number of significant implications for ABS economic collections. These are discussed in Information Paper: ABS Statistics And The New Tax System (cat. no. 1358.0). The replacement of the GE registration process by PAYGW registration resulted in a number of changes to the population frames used for most economic collections. However, adjustments have been made to the estimates so that these changes do not affect the statistics in this publication.
14 As in past years, data in this issue continue to be adjusted to allow for lags in processing new businesses to the ABS business register, i.e. adjustments have been made to allow for new businesses which had commenced operations but for which details had not been processed to the ABS business register in time for inclusion in the annual manufacturing industry collection. Adjustments of this type will continue to be applied in future periods. The majority of businesses affected by these lags are small in size. The effect of these adjustments on 2000-01 Australian estimates are increases of 2.6% for employment and 1.1% for sales and service income. Most states and territories and most industries were affected to a similar degree.
COMPARABILITY WITH PREVIOUS STATISTICS
15 For the 2000-01 manufacturing collection, the statistical unit from which data are collected has changed from manufacturing establishments to manufacturing management units. As a consequence, the previously published turnover data item has been replaced by the data item sales and service income. That is, conceptually, turnover is more relevant to establishment based data than management unit based data as turnover includes transfers out of goods between establishments of the same business (i.e. same management unit). On the other hand, a management unit, in almost all cases, coincides with the legal entity that owns the business, for example, a sole proprietor, partnership, company, trust etc. (however, large diversified businesses may contain more than one management unit, each coinciding with a 'division' or 'line of business' and where separate and comprehensive accounts are compiled) and, as such, the concept of transfers out of goods for management units does not exist. The data item sales and service income is conceptually more relevant to management unit based data; hence, the change from turnover to sales and service income within this publication.
16 Commencing with estimates for 1997-98, the definition of sales and service income has changed in line with new international standards for measuring economic variables. The composition of sales and service income estimates under the current standards is as follows:
| Sales and service income (as previously defined) |
plus | Income from rent, leasing and hiring |
plus | Royalty income from intellectual property |
equals | Sales and service income (new standards) |
| |
17 Commencing with estimates for 1997-98, under current international standards, contribution to gross domestic product (GDP) by manufacturing industries is being measured by the variable 'Industry value added' (IVA). Estimates for IVA measure the value added by an industry to the intermediate inputs used by that industry. Previously, the corresponding contribution to GDP was measured by the variable 'Industry gross product' (IGP).
18 Composition of IVA estimates and their relationship to IGP estimates are: | |
| Sales and service income (new standards) |
plus | Funding by federal, state or local governments |
| for operational costs |
plus | Own account capital work |
plus | Closing inventories |
less | Opening inventories |
less | Intermediate input expenses (see the operating expenses |
| entry in the Glossary) |
equals | IVA |
| |
| IVA |
plus | Intellectual property royalty expenses |
less | Intellectual property royalty income |
less | Computer software expenses not capitalised by the business |
less | selected indirect taxes (for manufacturing industries, the |
| main types are fringe benefits tax, payroll tax, land rates and |
| land taxes) |
equals | IGP |
| |
19 For the 1995-96 collection only, provision expenses for employee entitlements were excluded from wages and salaries. For all other years, these provision expenses are included in wages and salaries.
20 Periodic collections of the Retail and Wholesale Divisions of ANZSIC, conducted for the 1998-99 reference year, identified a number of businesses which were predominately manufacturers. A small number of these cases were determined to be significant in some manufacturing industries and were therefore added into the manufacturing collection for 1998-99. The effect of these additional units in published aggregates have been calculated as adding 0.6% to estimates for Australia for 1998-99. These businesses have been included in subsequent manufacturing collections if they remained classified as manufacturers on the ABS business register.
CHAIN VOLUME MEASURES
21 The chain volume measures appearing in this publication are annually reweighted chain Laspeyres indexes referenced to current price values in the chosen reference year (currently 2000-01). The current price values may be thought of as being the product of a price and quantity. The value in chain volume terms can be derived by linking together movements in volumes, calculated using the average prices of the previous financial year and applying compound movements to the current price estimates of the reference year. Each year’s growth rates in the chain volume series are based on the prices of the previous financial year. With each release of this publication, a new base year is introduced and the reference year is advanced one year. This means that for this issue of this publication, the chain volume measures for 2000-01 have 1999-2000 (the previous financial year) as their base year, and the reference year is 2000-01. A change in the reference year changes levels but not growth rates for all periods. A change in the base year can result in revisions, small in most cases, to growth rates for the last year.
22 Chain volume measures are not generally additive. In other words, component chain volume measures do not, in general, sum to a total in the way original current price components do. This means that the chain volume estimates for industry groups will not add to the total for Australia. In order to minimise the impact of this, the ABS ensures additivity does exist for the reference year and non-additivity is relatively small for the earlier years. For further information on chain volume measures, refer to the Information Paper: Introduction of Chain Volume Measures in the Australian National Accounts (cat. no. 5248.0).
EMPLOYMENT SIZE DATA
23 Summary of operations data at the industry subdivision level classified by the employment size of individual manufacturing management units (see the Glossary for its definition) are presented in table 5. Similarly, exports of goods produced data at the industry subdivision level classified by the broad employment size of individual manufacturing management units are presented in table 6. The statistics in these two tables relate only to those manufacturing management units operating at 30 June 2001. As such, the figures presented represent a slightly different population from those presented in the other tables from the manufacturing collection. These other tables include data for those manufacturing management units which operated at any time during 2000-01.
24 The treatment of unincorporated joint ventures under the ABS's standard units definitions has an effect on the data when classified by employment size. This is because joint venture participants report details of sales of goods and services, but often have few or no employees or operating expenses. The labour for such operations is usually employed and paid for by the joint venture operator. Similarly, the operating expenses are usually reported by the joint venture operator. On the other hand, the operator does not report any details of sales of goods and services (unless it also happens to be a participant). If each of these joint venture operations were to be treated as a single business unit in the statistics, it is highly probable that the Metal product manufacturing industry and to a lesser extent the Petroleum, coal, chemical and associated product manufacturing industry would reflect a similar dominance pattern to the other manufacturing industries. In other words, in the statistics in tables 5 and 6, the participants in unincorporated joint ventures are recorded in the 0-4 persons employment size category, whereas the operators of the unincorporated joint ventures are recorded in larger employment size categories. This treatment affects the relative contribution of the various employment size categories for these two industries.
EXPORTS BY MANUFACTURERS
25 All management units included in the manufacturing collection were asked whether they exported and, if so, what percentage of their sales of goods produced were exported by their business or an agent on their behalf. The data presented in table 6 are derived by applying the percentage of exports reported for each exporting unit and then aggregating that figure. The data in table 6 exclude those manufacturing management units which operated during 2000-01 but were not operating at 30 June 2001.
26 The statistics presented in table 6 for the value of exports by manufacturers or their agents are not intended to be directly comparable with the value of exports classified by manufacturing industry of origin as published by the ABS in international trade statistics. These latter statistics are intended to measure total exports regardless of which business or organisation does the exporting (and to identify the probable industry from which the goods originated), whereas the statistics in tables 6 and 7 only include exports directly undertaken by the manufacturer or by its agent.
27 The data in table 6 showing exports by manufacturers or their agents can be expected to show a much lower value than the exports data from the international trade series. The main reason is that for many exports of goods manufactured in Australia, the actual exporting activity is undertaken by a business other than the manufacturer. Also, the value of goods produced on a commission or fee basis for non-manufacturing businesses and which are then exported is not included in the data in tables 6 and 7. Examples of relevant commission work are the 'slaughtering fee' charged by an abattoir for processing livestock owned by a meat exporter and the 'tolling fee' charged by an aluminium smelter to process ores owned by other (e.g. mining) businesses. Also excluded from tables 6 and 7 are any exports by manufacturers of goods which were not produced by that manufacturer. These and other goods exported (e.g. re-exports) are included in the international trade data. Finally, differences in valuation of exports arise because the value of exports in the international trade series would include the value to the manufacturer plus profit margins for the exporter and for any intermediaries between the manufacturer and the exporter.
REGIONAL DATA
28 Regional or sub-state data will not be available from the 2000-01 manufacturing survey. This is a direct result of moving to a manufacturing management unit based collection for 2000-01; for further information, see Appendix 2. For further details about the availability of sub-state data, please contact John Ridley on Sydney 02 9268 4541.
ACKNOWLEDGEMENT
29 ABS publications draw extensively on information provided freely by individuals, businesses, governments and other organisations. Their continued cooperation is very much appreciated: without it, the wide range of statistics published by the ABS would not be available. Information received by the ABS is treated in strict confidence as required by the Census and Statistics Act 1905.
RELATED PUBLICATIONS
30 State publications, Manufacturing Industry, [state], (cat. nos 8221.1-8221.6), will not be produced for 2000-01; for further information, see Appendix 2. However, it is intended that they next be produced for 2001-02, that is, for the next census year. This and future issues of the publication Manufacturing Industry, Australia (cat. no. 8221.0) will continue to publish state and territory data for employment, wages and salaries, sales and service income and IVA at the industry subdivision level.
31 The ABS produces industry estimates for a range of selected industries (including Manufacturing) and these results are available in Australian Industry, 2000-01 (cat. no. 8155.0). State and territory estimates of these data have recently been published in Experimental Estimates, Australian Industry, a State Perspective, 1999-2000 (cat. no. 8156.0). For the 2000-01 reference year, the analysis previously presented in the latter publication will be included in the publication Australian Industry, 2000-01 (cat. no. 8155.0), which is due for release in December 2002. These data are considered experimental at this stage while the methodology used to produce them is reviewed and improved. The estimates are available at the ANZSIC industry subdivision level for total operating income, total operating expenses, operating profit before tax (OPBT) and labour costs.
32 Users may also wish to refer to the following publications:
- Australian National Accounts: National Income, Expenditure and Product, cat. no. 5206.0 - Quarterly publication
- Australian National Accounts: State Accounts, 2000-01, cat. no. 5220.0, released on 16 November 2001- Annual publication
- Australian System of National Accounts: Concepts, Sources and Methods, 2000, cat. no. 5216.0, released on 21 December 2000
- Business Indicators, Australia, cat. no. 5676.0 - Quarterly publication
- Business Operations and Industry Performance, Australia, 2000-01, cat. no. 8140.0, to be released on 31 October 2002 - Annual publication
- Business Operations and Industry Performance, Australia, Preliminary, 2000-2001, cat. no. 8142.0, released on 16 May 2002 - Annual publication
- Environment Protection, Mining and Manufacturing Industries, Australia, 2000-2001, cat. no. 4603.0, released on 4 September 2002 - Biennial publication
- Information Paper: ABS Statistics and The New Tax System, cat. no. 1358.0, released on 26 April 2000 - Irregular publication
- Information Paper: Improvements to ABS Economic Statistics, 1997, cat. no. 1357.0, released on 22 August 1997 - Irregular publication
- Information Paper: Improvements in ABS Economic Statistics [Arising from The New Tax System], 2002, cat. no. 1372.0, released on 6 May 2002 - Irregular publication
- Information Paper: Introduction of Chain Volume Measures in the Australian National Accounts, 1997, cat. no. 5248.0, released on 19 March 1998 - Irregular publication
- Labour Costs, Australia, 1996-97, cat. no. 6348.0, released on 2 July 1998 - Quinquennial publication
- Labour Force, Australia, cat. no. 6203.0 - Monthly publication
- Manufacturing, Australia, 2002, cat. no. 8225.0, to be released in February 2003 - Annual publication
- Manufacturing Industry, Australia, Preliminary, 2001-02, cat. no. 8201.0, to be released in March 2003 - Annual publication
- Private New Capital Expenditure and Expected Expenditure, Australia, cat. no. 5625.0 - Quarterly publication
- Producer Price Indexes, Australia, cat. no. 6427.0 - Quarterly publication
- Wage Cost Index, Australia, cat. no. 6345.0 - Quarterly publication
BACK SERIES AND ADDITIONAL DATA
33 The 1999-2000 manufacturing collection was the last to collect information primarily from manufacturing establishments as well as collecting limited data from a relatively small sample of manufacturing management units. For the 2000-01 manufacturing collection, information was solely collected from manufacturing management units.
34 A considerable volume of data (primarily manufacturing establishment based data but some manufacturing management unit based data) is available from past annual manufacturing collections. Firstly, a range of manufacturing industry statistics publications is available for previous years. In addition, more detailed information to satisfy individual user requirements may be available on request and for a charge. In general, this consists of finer industry dissections of manufacturing establishment data than that previously presented in the manufacturing series of publications. For more information about the availability of management unit data for previous years, see paragraph 3 of Appendix 2. Additional data may also be available from the 2000-01 collection. As a guide, a list of data items included on the 2000-01 manufacturing survey forms and a selection of data variables that can be derived from them are shown in Appendix 1.
35 For management units, chain volume measures of IVA are available from 1995-96. For establishments, chain volume measures on a true ANZSIC basis are only available from 1989-90; however, chain volume measures of IVA on an ANZSIC basis are available back to 1984-85. They were compiled by converting estimates for earlier years onto an ANZSIC basis using the relationships that applied between the previous Australian Standard Industrial Classification (ASIC) and ANZSIC in the years 1990-91 and 1991-92. These estimates are available for Australia back to 1984-85. It should be noted that the relationships that applied in 1990-91 and 1991-92 are less likely to apply the earlier the reference year.
ROUNDING
36 Where figures have been rounded, discrepancies may occur between totals and the sums of the component items. Due to data being adjusted for lags in processing new businesses to the ABS business register (see paragraph 14), this 'rounding rule' also applies to employment counts.
37 Proportions, ratios and other calculated figures shown in this publication have been calculated using unrounded estimates and may be different from, but are more accurate than, calculations based on the rounded estimates.
ABBREVIATIONS
ABS | Australian Bureau of Statistics |
ANZSIC | Australian and New Zealand Standard Industrial Classification |
ASIC | Australian Standard Industrial Classification |
ATO | Austrlian Taxation Office |
f.o.b. | free on board |
GDP | gross domestic product |
GE | group employer |
GST | goods and services tax |
IGP | industry gross product |
IVA | industry value added |
mfg | manufacturing |
n.e.c. | not elsewhere classified |
OPBT | operating profit before tax |
PAYGW | pay as you go withholding |
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