1301.0 - Year Book Australia, 2012
ARCHIVED ISSUE Released at 11:30 AM (CANBERRA TIME) 24/05/2012
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Statistics contained in the Year Book are the most recent available at the time of preparation. In many cases, the ABS website and the websites of other organisations provide access to more recent data. Each Year Book table or graph and the bibliography at the end of each chapter provides hyperlinks to the most up to date data release where available.
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RESEARCH AND EXPERIMENTAL DEVELOPMENT (R&D)
The OECD defines Research and experimental development (R&D) as comprising “... creative work undertaken on a systematic basis in order to increase the stock of knowledge, including knowledge of man, culture and society, and the use of this stock of knowledge to devise new applications.”
The ABS has extended this definition as follows: R&D is systematic investigation or experimentation involving innovation or technical risk, the outcome of which is new knowledge, with or without a specific practical application, or new or improved products, processes, materials, devices or services. R&D extends to modifications to existing products/processes but ceases (and pre-production begins) when work is no longer experimental.
R&D covers four type of activities: pure and strategic basic research, applied research and experimental development. Pure basic research is experimental and theoretical work undertaken to acquire new knowledge without looking for long-term benefits other than the advancement of knowledge, while strategic basic research is directed into specified broad areas in the expectation of practical discoveries. Applied research is original work undertaken primarily to acquire new knowledge, with a specific application in view. It is undertaken either to determine possible uses for the findings of basic research or to determine new ways of achieving some specific and predetermined objectives. Experimental development is systematic work, using existing knowledge gained from research or practical experience, which is directed to producing new materials, products, devices, policies, behaviours or outlooks; to installing new processes, systems and services; or to improving substantially those already produced or installed.
R&D can also be classified in various ways, including by field of research (FOR) and socio-economic objective (SEO). The FOR classification allows R&D activity to be categorised according to the methodology used in the R&D, rather than the activity of the unit performing the R&D or the purpose of the R&D. The FOR reflects the field in which the research was undertaken and is based on the processes and techniques used. The FOR classification is hierarchical with three levels: Division, Group and Field. The SEO classification allows R&D activity to be categorised according to the intended purpose or outcome of the research, rather than the processes or techniques used in order to achieve this objective. The SEO reflects the dominant beneficiary or beneficiaries of the research output. The SEO classification is also hierarchical and has four levels: Sector, Division, Group and Objective.
Statistics on the amount of expenditure and human resources devoted to R&D effort in the business sector are collected annually by the ABS, while comparable statistics for the government, higher education and private non-profit sectors are collected biennially.
In 2008–09, gross expenditure on R&D was $28,146 million (table 26.1). This represented an increase of 29% over 2006–07. The business and higher education sectors accounted for most of the increase.
(b) 2008–09 data were revised as an outcome of the 2009–10 data collection cycle.
(c) Collected on a calendar year basis.
Source: Research and Experimental Development, Businesses, Australia (8104.0); Research and Experimental Development, Government and Private Non-Profit Organisations, Australia (8109.0); Research and Experimental Development, Higher Education Organisations, Australia (8111.0).
BUSINESS SECTOR
During 2009–10, expenditure on R&D undertaken by businesses (BERD) in Australia was $16,685 million, which represented a decrease of 3% from 2008–09 (table 26.2). Human resources devoted to business R&D in 2009–10 were 57,457 person years of effort (PYE), an increase of 6% from 2008–09.
BERD decreased by 3% in current price terms and 5% in chain volume terms, compared to 2008–09.
(b) The reference year for chain volume measures is 2009–10.
Source: Research and Experimental Development, Businesses, Australia (8104.0).
The industry divisions of Manufacturing and Mining continued to be the largest contributors to total BERD in 2009–10, contributing $4,219 million (25%) and $3,695 million (22%), respectively. Financial and insurance services ($2,651m or 16%) and Professional, scientific and technical services ($2,516m or 15%) were the next largest contributors (graph 26.3). Combined, these four industries accounted for 78% of BERD.
Table 26.4 shows more detailed industry data by type of R&D activity.
RETAIL TRADE
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
EDUCATION AND TRAINING
HEALTH CARE AND SOCIAL ASSISTANCE
ARTS AND RECREATION SERVICES
OTHER SERVICES(b)
np not available for publication but included in totals where applicable, unless otherwise indicated
(a) Classified according to the Australian and New Zealand Standard Industrial Classification (ANZSIC), 2006 edition (1292.0).
(b) Not all subdivisions were included in the scope of the 2009–10 survey.
Source: Research and Experimental Development, Businesses, Australia, 2009–10 (8104.0).
In 2009–10, the largest businesses (those with 200 or more employees) made the largest contribution to BERD ($11,477m or 69%), followed by businesses with 20–199 employees ($3,097m or 19%). The overall decrease in BERD for 2009–10 was attributable to businesses with 200 or more employees, which decreased $582 million compared to the overall decrease of $579 million. In 2009–10, these businesses also had the largest percentage decrease in BERD (down 5%) and the largest decrease in proportional share of total BERD (down 1 percentage point), compared to 2008–09.
The business sector was the main source of BERD funds in 2009–10, with $15,930 million (96% of total BERD) coming from Own funds and $193 million (1% of total BERD) from Other business. Commonwealth government and Overseas sources were the next largest funders of BERD, at $308 million (2% of total BERD) and $166 million (1% of total BERD), respectively.
New South Wales and Victoria continued to have the highest levels of BERD in 2009–10, at $6,194 million (37% of total BERD) and $3,750 million (22% of total BERD), respectively. In 2009–10, NSW, Northern Territory and Overseas were the only locations with increased BERD compared to 2008–09. NSW had the largest dollar increase (up $832m) and also the largest increase in proportional share of total BERD (up 6 percentage points to 37%). Growth in BERD in NSW was driven by the Financial and insurance services industry (up $584m in NSW).
In 2009–10, the majority of BERD continued to be directed into Experimental development ($10,074m or 60% of total BERD) and Applied research ($5,772m or 35% of total BERD). Between 2008–09 and 2009–10, expenditure on Experimental development fell by $316 million, with Applied research falling by $150 million.
As in previous years, the two Fields of research (FOR), Engineering and Information and computing sciences accounted for more than 80% of total BERD in 2009–10.
The distribution of BERD across the Socio-economic objective (SEO) sectors of Defence, Economic development, Society, Environment and Expanding knowledge remained relatively stable between 2008–09 and 2009–10. At the SEO division level, Manufacturing accounted for the largest share of total BERD in 2009–10, at $4,383 million, or 26%. Commercial services and tourism and Energy SEOs had the next highest levels of BERD, at $3,161 million (19% of total BERD) and $2,722 million (16% of total BERD), respectively.
Of all SEO divisions, Mineral resources (excluding energy resources) had the largest dollar and percentage decrease in BERD, down $846 million (or 32%) compared to 2008–09, and the largest decrease in proportional share of total BERD (down 4 percentage points from 15% to 11% in 2009–10). The Commercial services and tourism SEO division had the largest dollar increase in BERD compared to 2008–09 (up $745m) and the largest increase in proportional share of total BERD (up 5 percentage points from 14% to 19% in 2009–10).
Wholly Australian-owned businesses made the largest contribution to total BERD, accounting for $8,614 million or 52% in 2009–10. These businesses also had the largest dollar increase (up $767m) and the largest increase in proportional share of total BERD (up 6 percentage points from 46%) compared to 2008–09.
BERD as a proportion of gross domestic product (GDP) decreased between 2008–09 and 2009–10, down from 1.38% to 1.30% (graph 26.5).
HIGHER EDUCATION SECTOR
During the 2008 calendar year, expenditure on R&D undertaken by Australian higher education institutions (HERD) was $6,717m. Over the same period, human resources devoted to R&D by these institutions represented 61,310 person years of effort (PYE).
Most higher education human resources devoted to R&D in 2008 were Postgraduate students and Academic staff, accounting for 56% and 31% of total PYE, respectively. The remaining 13% was attributable to Other staff directly supporting R&D.
In 2008, HERD showed an increase of 24% in current price terms over 2006, and 18% in chain volume terms. HERD as a proportion of GDP increased from 0.50% in 2006 to 0.53% in 2008 (graph 26.6).
The main sources of funds for HERD in 2008 were General university funds ($3,523m or 52% of HERD) and Australian competitive research grants ($1,181m or 18% of HERD). These were also the major sources of funds in 2006.
In 2008, higher education institutions based in New South Wales, Victoria and Queensland altogether contributed almost three-quarters (72%) of HERD (at $2,015m, $1,775m and $1,062m respectively).
In 2008, 41% of HERD ($2,772m) was directed towards Applied research, 29% ($1,941m) to Pure basic research, and 21% ($1,389m) to Strategic basic research. The remaining 9% of HERD ($615m) was directed towards Experimental development.
Expenditure devoted to Medical and health sciences Field of research (FOR) ($2,064m) represented 31% of HERD in 2008, and was almost triple the value of the next highest FOR, Biological sciences ($689m). In total, Medical and health sciences, Biological sciences and Engineering FORs made up approximately half of total HERD.
Over a third (35% or $2,347m) of HERD in 2008 was directed to the Socio-economic objective of Health, which includes R&D related to the understanding and treatment of clinical diseases and conditions, and the provision of public health services.
GOVERNMENT SECTOR
During the 2008–09 financial year, expenditure on R&D undertaken by Australian Government organisations (GOVERD) was $3,420 million. Over the same period, human resources devoted to R&D by these organisations represented 17,042 person years of effort (PYE).
In 2008–09, GOVERD showed an increase of 10% in current price terms from 2006–07, and 4% in chain volume terms. GOVERD as a proportion of GDP decreased from 0.28% in 2006–07 to 0.27% in 2008–09 (graph 26.7).
In 2008–09, the majority of GOVERD was sourced from Own funds at $2,287 million (or 67%). The next largest source of R&D funds was Other Commonwealth government at $449 million (or 13% of GOVERD). GOVERD in Victoria ($811m) and New South Wales ($780m) accounted for almost half (47%) of total GOVERD in 2008–09.
The distribution of GOVERD across type of activity in 2008–09 was largely unchanged from 2006–07. As observed for 2006–07, more than half of GOVERD was directed into Applied research (56% or $1,916m in 2008–09) and over a quarter into Strategic basic research (26% or $892m in 2008–09).
The Fields of research (FOR) attracting the largest amounts of GOVERD were Engineering ($611m), Agricultural and veterinary sciences ($545m) and Medical and health sciences ($452m). These three FORs accounted for 18%, 16% and 13% of total GOVERD, respectively.
In 2008–09, more than half (57%) of GOVERD was directed to the Socio-economic objective (SEO) sectors of Economic development ($1,159m or 34%) and Environment ($794m or 23%). At the SEO division level, a similar proportion of GOVERD (53%) was attributable to Environment ($794m or 23%), Health ($544m or 16%) and Defence ($486m or 14%) in 2008–09.
PRIVATE NON-PROFIT SECTOR
During the 2008–09 financial year, expenditure on R&D undertaken by Australian private non-profit (PNP) organisations (PNPERD) was $744 million. Over the same period, human resources devoted to R&D by PNP organisations represented 4,788 person years of effort (PYE).
In 2008–09, PNPERD increased by 22% in current price terms compared with 2006–07 and 15% in chain volume terms. PNPERD as a proportion of GDP increased by 6% between 2006–07 and 2008–09 (graph 26.8).
The main sources of funds for PNPERD in 2008–09 were Commonwealth government ($285m or 38% of total PNPERD) and Own funds ($179m or 24%). Of all sources of funds, Commonwealth government had the largest dollar increase from 2006–07 (up $89m) and the largest change in proportional share of PNPERD (up 6 percentage points).
In 2008–09, almost 90% of PNPERD was in Victoria and New South Wales at $402 million (54%) and $259 million (35%), respectively. These locations also recorded the highest dollar increases in PNPERD from 2006–07, up $67 million and $65 million, respectively.
Almost 70% of PNPERD in 2008–09 was directed into Applied research ($261m or 35%), and Strategic basic research ($246m or 33%). PNPERD directed into Experimental development in 2008–09 ($164m) was more than double than in 2006–07.
In 2008–09, PNPERD devoted to the Medical and health sciences Field of research (FOR) represented 75% ($559m) of the total. This was more than four times the next highest FOR, Biological sciences (at $117m or 16% of PNPERD).
The majority (98%) of PNPERD in 2008–09 was directed to the Socio-economic objective sector of Society. At $685 million, the Health division contributed 94% to the Society sector and 92% to total PNPERD