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8129.0 - Business Use of Information Technology, 2002-03  
Previous ISSUE Released at 11:30 AM (CANBERRA TIME) 17/03/2004   
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INTRODUCTION

1 This publication presents results from the 2002-03 Business Use of Information Technology (BUIT) survey. This survey measured the use of computers, Internet and web technologies by Australian businesses. It also collected data relating to information technology (IT) security and ordering of goods and services via the Internet or web.

2 Since 1999-2000, the BUIT survey has been conducted on an annual basis. The survey has a set of core items for which data is collected each year. The remainder of survey content is dynamic and is updated each survey cycle to reflect emerging and changing uses of IT.


SCOPE AND COVERAGE

3 The scope of the BUIT survey is all employing businesses in Australia with the exception of businesses classified to:

  • SISCA 3000 General Government
  • SISCA 6000 Rest of the world
  • ANZSIC Division A Agriculture, Forestry and Fishing
  • ANZSIC Division M Government Administration and Defence
  • ANZSIC Division N Education
  • ANZSIC Sub-division 97 Private Households Employing Staff
  • ANZSIC 9610 Religious organisations

4 The frame for the BUIT survey, like most ABS economic collections, is taken from the ABS Business Register. The register provides a list of employing businesses, primarily based on registrations to the Australian Taxation Office's (ATO) Pay As You Go Withholding (PAYGW) scheme. The frame is updated quarterly to take account of new businesses, businesses which have ceased employing, changes in employment levels, changes in industry and other general business changes. Businesses which have ceased employing are identified when the ATO cancels their Australian Business Number (ABN) and/or PAYGW registration. In addition, businesses with less than 50 employees which did not remit under the PAYGW scheme in each of the previous five quarters are removed from the frame. The estimates in this publication include an allowance for the time it takes a newly registered business to get on to the survey frame.


CHANGES TO THE ABS BUSINESS REGISTER

5 The introduction of The New Tax System (TNTS) has a number of significant implications for ABS business statistics. These are discussed in Information Paper, Improvements in ABS Economic Statistics [Arising from the New Tax System] (cat. no. 1372.0). The replacement of the Group Employer registration process by PAYGW registration resulted in a number of changes to most business survey frames. The changes included the statistical units model; update of industry for some businesses by the ATO; and, availability of different measures of business size.


STATISTICAL UNITS DEFINED ON THE ABS BUSINESS REGISTER

6 The ABS uses an economic statistics units model on the ABS Business Register to describe the characteristics of businesses, and the structural relationships between businesses. The units model is also used to break groups of related businesses into relatively homogenous components that can provide data to the ABS.

7 In mid 2002, to better use the information available as a result of TNTS, the ABS changed its economic statistics units model. The new units model allocates businesses to one of two sub-populations. The vast majority of businesses are in what is called the ATO Maintained Population, while the remaining businesses are in the ABS Maintained Population. Together, these two sub-populations make up the ABS Business Register population.

ATO Maintained Population

8 Most businesses and organisations in Australia need to obtain an ABN, and are then included on the ATO Australian Business Register. Most of these businesses have simple structures; therefore the unit registered for an ABN will satisfy ABS statistical requirements. For these businesses, the ABS has aligned its statistical units structure with the ABN unit. The businesses with simple structures constitute the ATO Maintained Population, and the ABN unit is used as the statistical unit for all economic collections.

ABS Maintained Population

9 For the population of businesses where the ABN unit is not suitable for ABS statistical requirements, the ABS maintains its own units structure through direct contact with each business. These businesses constitute the ABS Maintained Population. This population consists typically of large, complex and diverse businesses. The new statistical units model described below has been introduced to cover such businesses.

Enterprise Group: This is a unit covering all the operations in Australia of one or more legal entities under common ownership and/or control. It covers all the operations in Australia of legal entities which are related in terms of the current Corporations Law (as amended by the Corporations Legislation Amendment Act 1991), including legal entities such as companies, trusts, and partnerships. Majority ownership is not required for control to be exercised.

Enterprise: The enterprise is an institutional unit comprising (i) a single legal entity or business entity, or (ii) more than one legal entity or business entity within the same Enterprise Group and in the same institutional sub-sector (i.e. they are all classified to a single Standard Institutional Sector Classification of Australia sub-sector).

Type of Activity Unit (TAU): The TAU is comprised of one or more business entities, sub-entities or branches of a business entity within an Enterprise Group that can report production and employment data for similar economic activities. When a minimum set of data items are available, a TAU is created which covers all the operations within an industry sub-division (and the TAU is classified to the relevant sub-division of the ANZSIC). Where a business cannot supply adequate data for each industry, a TAU is formed which contains activity in more than one industry sub-division.


IMPACT ON BUIT OF CHANGES ARISING FROM TNTS

10 The main impact of the introduction of TNTS for the BUIT survey is a changed population from which the survey frame has been drawn. This has had several effects on the estimates contained within this publication including:
  • smaller survey frame with a decrease of approximately 6% in the number of businesses on the ABS register in scope of the survey;
  • compositional change to the survey frame, particularly in employment size categories (predominantly caused by a change in the employment variable used for survey selection) and industry (caused by utilisation of ATO industry codes for the ATO maintained component of the population); and
  • higher than average sample rotation.

11 As part of TNTS changes to the ABS Business Register, two of the characteristics updated (also used in the design of the sample for BUIT) included employment and industry. These updates have resulted in major compositional changes to the survey frame from which the sample is drawn. The number of businesses in scope for the 0-4 persons, 5-19 persons, 20-99 persons, and 100 or more persons employed size groups changed by -4%, -16%, +16%, and +20% respectively. The changes at the industry level ranged from a decrease of 16% in the number of businesses classified to the Wholesale trade industry to an increase of 66% in the number of businesses classified to the Electricity, gas and water supply industry. More information about these compositional changes is available upon request.

12 The impact of TNTS on the total in-scope population, particularly composition by business size and industry, has resulted in a higher than usual sample rotation rate. The usual sample rotation rate is approximately one third of businesses in the sampled component of the survey. However, this rate doubled for 2002-03. Businesses rotated into the survey can report differently from those businesses they replace or those already in the sample, however, these differences are usually not noticeable on survey estimates and are taken into account when calculating sampling error. While every attempt has been made to take into account the larger than usual sample rotation in survey design and estimate of sampling error, the size of the rotation may have impacted on survey estimates for 2002-03. Please refer to the Technical Note section for more information about the RSEs for 2002-03.

13 For the core data items of computer use, Internet use and web presence, the 2001-02 BUIT survey results have been recompiled to incorporate the impact of the new infrastructure. Analysis of these estimates shows that the impact of TNTS is less than one percent for each of these items (-0.07%, +0.04% and +0.9% for computer use, Internet use and web presence respectively) and is lower than the Relative Standard Error (RSE) achieved in 2001-02 (0.6%, 0.9% and 2.7% for computer use, Internet use and web presence respectively). The change would be considered statistically significant if the estimated change was greater than two RSEs (i.e. greater than the 95% confidence interval). Due to the small magnitude of these changes, revised estimates have not been published. Information on the impact for each of these variables by industry or state/territory is available upon request.

14 In interpreting the results of the published estimates and, in particular, if attempting to compare to the results published for earlier surveys, these changes must be taken into consideration. It is highly likely that changes of a small magnitude between 2001-02 and 2002-03 have resulted from changes to the survey population rather than actual changes in the characteristic being measured. For example, when comparing the percentage of businesses using a computer, the estimate for 2002-03 shows that 83% of all business used a computer, this is a decrease of one percentage point from the estimate published for 2001-02. It is more than likely that this decrease is due to the impact of infrastructure changes rather than a decrease in the proportion of businesses using computers. Where the change is of a larger magnitude, other sources have been taken into consideration and these changes may be treated as an indicator of the trend of movement rather than an absolute change in percentage terms. Where this has occurred, specific references are made in the commentary.

15 While the impact of TNTS is significant, it does not represent an actual break in series. However, comparisons between 2002-03 estimates and previously published data should be made with caution and in the context of the changes outlined.


SURVEY METHODOLOGY

16 The BUIT survey is conducted by mail. It is based on a random sample of approximately 12,500 businesses which is stratified by industry, state/territory and number of employees. All manufacturing businesses with 500 or more employees and all other businesses with 200 or more employees are included in the sample.


ORDERS FOR GOODS AND SERVICES VIA THE INTERNET AND INTERNET INCOME

17 The concept of Internet income presented in this publication relates to income from all orders for goods or services where the order is received, and the commitment to purchase is made via the Internet or web, with or without online payment. Like previous surveys, the 2002-03 BUIT survey has highlighted issues which affect the quality and interpretation of estimates of Internet income and the proportion of businesses receiving orders for goods and services via the Internet or web. Readers should consider these issues when using these estimates.

18 The ABS uses the Organisation for Economic Co-operation and Development (OECD) definition of an Internet commerce transaction and therefore measures the income resulting from Internet orders for goods and services. For the purposes of the BUIT survey, this definition has been refined to only include orders (and resultant income) where the commitment to purchase is made via the Internet or web. An important element of the definition remains that payment and the ultimate delivery of the good or service is not relevant, that is, either or both may be conducted off line. ABS experience in collecting Internet income continues to highlight the difficulty of defining an Internet commerce transaction in a way which is understood by businesses and suits all forms of Internet commerce. For instance, for some businesses, the Internet transaction initiates and completes the purchase, while for others the Internet transaction finalises details of a purchase which was initiated by a non-Internet based agreement or contract.

19 Some orders for goods and services are initiated over the Internet and are then subject to ongoing payments. Ongoing payments may occur over a long period of time and via non-Internet based media. For consistency in compiling the income measure and to ensure that it covers all income flowing from the initial order over the Internet, the ABS would ideally like to include ongoing payments via the Internet, but recognises that most businesses are unable to track these payments. Survey estimates for the 2002-03 survey and previous collections may be understated due to this measurement issue.

20 As in previous surveys, many businesses surveyed in the 2002-03 survey did not maintain records on the basis of the Internet income measure described in paragraph 18 and therefore needed to estimate its value. For some large businesses, the estimation of Internet income continues to be difficult and in some instances responses were inconsistent with those of previous surveys. While the ABS has reduced this error through analysis of responses and consultation with businesses, this form of error cannot be completely eliminated.


OUTPUT CLASSIFICATIONS

21 For output purposes, businesses are classified to employment and income size groups based on actual data reported in the survey. For other output groups (industry, state or territory, capital city/other areas) the classification is drawn from information held about the business on the ABS Business Register.


RELATED PUBLICATIONS

22 The most recent issue of other ABS publications on the use and production of information and communication technologies in Australia are listed below.

Government Use of Information Technology, Australia, 1999-2000 (cat. no. 8119.0)

Household Use of Information Technology, Australia, 2001-02 (cat. no. 8146.0)

Information Technology, Australia, 2000-01 (cat. no. 8126.0)

Internet Activity, Australia, September 2003 (cat. no. 8153.0)

Use of Information Technology on Farms, Australia, June 2002 (cat. no. 8150.0)


ABS WEB SITE

23 Other information relating to information and communication technologies can be found on this web site, see the Science and Technology Home page under Themes.


DATA AVAILABLE ON REQUEST

24 As well as the statistics included in this publication, the ABS may have relevant data available on request. The availability of more detailed data are subject to confidentiality and quality checks. Inquiries should be made to the National Information and Referral Service on 1300 135 070.


ROUNDING

25 Where figures have been rounded, discrepancies may occur between the sum of the components/items and the total. In addition, percentages have been calculated using the unrounded figures.


COMMENTS

26 The ABS welcomes comments and suggestions from users regarding future surveys of IT use by businesses. These comments should be addressed to the Director, Innovation and Technology Business Statistics Centre, Australian Bureau of Statistics, GPO Box K881, Perth, WA, 6842.


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