Business Characteristics Survey

NAME OF ORGANISATION
Australian Bureau of Statistics (ABS)

OVERVIEW

The Business Characteristics Survey (BCS) is an annual survey and it is the vehicle for the ABS' Integrated Business Characteristics Strategy (IBCS). The strategy integrates the collection and quality assurance of data required for input into both ABS Business Longitudinal Database (BLD) and the production of point in time estimates for: use of information technology, innovation; and, a broad range of other non-financial characteristics. A key part of the IBCS is the production of annual use of information technology and innovation indicators, with a more detailed set of items for each of these topics collected every second year (i.e. in alternating years). For example, the 2011-12 BCS collected detailed information relating to the use of information technology by Australian businesses.

The first BCS was conducted in 2004-05; this survey collected business characteristics data required for the BLD only. The 2005-06 was the first integrated survey and combined the collection of general business characteristics required for the BLD with the collection of items previously collected in the Business Use of Information Technology (BUIT) survey and some summary indicators previously collected in the Survey of Innovation in Australian Business. The 2006-07 survey collected general business characteristics and more detailed innovation data.

The sample design for this survey is complex due it serving dual purposes: collection of characteristics data for the ABS' BLD; and production of point in time estimates. While there are scope differences between the BLD and point in time estimates, the intention is to maximise the number of businesses selected for which data collected can contribute to both purposes.

The design variables for the BCS population outputs are the proportion of businesses undertaking internet commerce (placing and/or receiving orders) and proportion of innovators. The target Standard Errors for the design variables are specified at the total Australian level and are comparable to that achieved for BUIT and approximately double that achieved for Innovation in the past. The targets then vary based on industry and employment size; they are broadly comparable to the quality achieved in previous surveys.

The overall (once all panels have been birthed) target sample size is approximately 14,000 selections. For the 2012-13 BCS, of the total overall sample, approximately 6,500 selections contribute to BCS population estimates and 8,200 form part of the BLD panels (this means that around 2,200 selections are common to both the BLD and the population estimates). Careful consideration is being given to all aspects of sample design, particularly those which could result in more efficiencies and reduced provider load.

The core IT and business characteristics content has remained relatively unchanged since 2006-07. In general, innovation content is more onerous and conceptually complex than IT content. Core business characteristics content includes the activity of the business, the number of locations, whether the business is home based; employment including casuals, full/part time, turnover and pay arrangements; age of business; foreign ownership; trade status; franchising and other co-operative arrangements; measures used to assess business performance; debt and equity finance; markets and competition; and, core annual indicators of innovation and IT use.

The benefits of the Integrated Business Characteristics Strategy (IBCS) include:
• A more coherent and consistent set of business characteristic statistics covering a range of variables for the whole economy. The enhanced usefulness of business characteristics data will be possible through the integration of data collection as more data will be relatable.
• Users will have greater ability to undertake cross-cutting research on the effects of various business practices on firm performance. This is the most significant benefit from the integration proposal.
• Improved data quality through alignment of concepts, increased data confrontation, improved survey design and estimation methodologies, and consistent survey processes;
• Flexibility of the collection vehicle to adapt to changing needs;
• Reduced overall provider load due to two instead of three survey iterations every two years. In addition, the reuse of longitudinal data to contribute to cross-sectional estimates may result in a reduced overall sample size over the sample sizes required for separate surveys.
• A more even spread of workload across years for internal ABS processing areas;
• Ongoing ABS resource efficiencies in having two instead of the current three surveys covering Innovation and BUIT every two years, as well as efficiencies that may be garnered by any overlap in longitudinal and cross-sectional sample; and
• More rapid development and adoption of best practice survey processes with associated reduced operational costs through the streamlining of business processes re-use of aspects of existing business processes, systems and methodologies.

The BCS aims to collect key measures on business characteristics to develop more relevant and effective government industry policies, supporting the Australian businesses particularly, the small and medium businesses. The data collected will support the BLD and will be used to build a statistical longitudinal database for public and private sector analysts. It is aimed to provide users with business characteristics data augmented with financial data from administrative sources and other existing ABS surveys.

Population and cross-classified outputs can be produced for most BCS content not just BUIT and Innovation The much larger volume of characteristics data (particularly, annual indicators of innovation and the ability to produce cross-classified outputs) has expanded the range of outputs.. These additional outputs, as well as the BLD CURF (and other analytical outputs), result in a substantial increase in the amount of these types of information. The BCS also enables the production of a range of statistics that is complementary to financial data produced by the Annual Industry Statistics (AIS) BSC.

Key users of both the BLD and population (cross-classified) outputs are Department of Industry, Department of Communication, Productivity Commission, CSIRO, Department of Education, Department of Employment, Treasury, Department of Agriculture, Department of Environment.

1. The scope of BCS population estimates are employing businesses based on the Pay As You Go Withholding (PAYGW) scheme in the industries specified. It is not unusual for some of these 'employing businesses' to have zero employment at various times during the reported period.
2. The scope of the BLD is all businesses registered for an Australian Business Number (ABN) that remit GST and have an employment of less than 200. Additional sample is included for the BLD in relevant ANZSIC groups in the Agriculture, Forestry and Fishing; Manufacturing; and Wholesale Trade divisions to represent the “Food Industry” and enable more detailed analysis of this “Industry”.

• SISCA 3000 General government
• SICSA 6000 Rest of the world

• SISCA Sector 2 - Financial corporations
• SISCA Sector 5 - Not-for-profit Institutions Serving Households

Conceptual framework
Conceptually, the BCS includes all 'economically active' businesses or business entities that have registered for an Australian Business Number (ABN), and have an active tax role; ie. remit GST for the BLD and Income Tax Withholding (ITW) for the population estimates. Further scoping is determined using the Standard Economic Classifications of Australia (SESCA) and the Australian and New Zealand Standard Industrial Classification (ANZSIC).

As the focus of this survey is on the market sector of the economy, it includes all business sizes- small, medium and large. Large businesses do not contribute to the BLD but are included in population and cross-sectional estimates. Non-employing businesses, such as sole proprietorships and partnerships, are included in the BLD component. The survey excludes some industries, mainly because they are dominated by government enterprises or classified as non profit institutions serving households, which are less important from an industry policy viewpoint.

Main outputs
There will be two distinct streams of output for the BCS - longitudinal unit record level (BLD) and population/cross sectional estimates.

The BLD will include characteristics data and other linked data, e.g. BIT, BAS, Trade and the resultant CURF(s) will provide a longitudinal view of small/medium business.

Population estimates for data collected in the BCS will be produced for all business sizes. This will include the cross-classification of some outputs by innovator status; degree of foreign ownership and broadband use. In alternate years detailed population estimates for Innovation and Business Use of Information Technology will be produced (some of these will be cross-classified with other indicators collected on the form.

Two form types were introduced for the first time in the 2006-07 BCS. There will now be a long form for the component of the sample that contributes to the production of population estimates and a short form for units included in the BLD only (these are predominantly units in the Agriculture, Forest and Fishing Division and non-employing businesses across all industries).

Classifications