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8669.0 - Computing Services Industry, Australia, 1998-99  
Latest ISSUE Released at 11:30 AM (CANBERRA TIME) 28/08/2000   
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MEDIA RELEASE

August 28, 2000
Embargoed: 11:30 AM (AEST)
115/2000

ABS: Computer Services Industry on the Increase

There were 14,731 businesses operating in the computer services industry at the end of June 1999, according to figures released by the Australian Bureau of Statistics (ABS) today. This represented a 52 per cent increase in the number of businesses since June 1996 and an annualised growth rate of 15 per cent over the three years.The industry was dominated by small businesses during 1998-99, with 14,414 businesses (98 per cent) having fewer than 20 people employed.

Businesses in the computing services industry generated $10,474 million in income during 1998-99, which was a 30 per cent increase since 1995-96. The main components were the provision of bundled computer services ($3,354 million), non-bundled customised software services and solutions ($2,556 million) and computer processing services ($1,106 million).

In 1998-99, the operating profit before tax for the industry was $836 million, which represented an operating profit margin of 8.2 per cent. This was a significant increase on the operating profit margin of 5.7 per cent recorded in 1995-96 but still less than the 9.5 per cent operating profit margin recorded in 1992-93.

Businesses in the computer services industry incurred $9,654 million in expenses during 1998-99. Labour costs was the highest single expense ($4,065 million) representing 42 per cent of total expenses. Payments made to contractors and consultants for computing and communications services accounted for a further 15 per cent ($1,396 million) of total expenses.

At the end of June 1999, there were 74,395 persons working for businesses in the computer services industry, which was a 35 per cent increase since June 1996. The majority (76 per cent) of people employed in the industry were computing and technical staff, and 77 per cent of these staff were male.

Small businesses with less than 20 people employed accounted for 48 per cent of industry employment and 28 per cent of industry income. Businesses with four or less persons employed represented 88 per cent of all businesses, 32 per cent of industry employment and 16 per cent of industry income. The growth in the number of micro businesses was 15 per cent per annum since June 1996. In comparison there were 56 businesses in the industry employing 100 persons or more. These 56 large businesses accounted for 39 per cent of industry employment, 59 per cent of industry income and 51 per cent of the operating profit before tax for the industry.

A high proportion of industry income was generated by businesses operating in New South Wales (49 per cent) and Victoria (29 per cent). These businesses accounted for 73 per cent of people employed in the industry and 78 per cent of the total income.

Further details can be found in Computing Services Industry, Australia, 1998-99 (cat. no. 8669.0) available from ABS bookshops. The summary of the publication are also available on this site. If you wish to purchase a copy of this publication, contact the ABS bookshop in your capital city.

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