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1301.0 - Year Book Australia, 2002  
Previous ISSUE Released at 11:30 AM (CANBERRA TIME) 25/01/2002   
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Contents >> Communications and Information Technology >> Business use of information technology

The use of information technology by Australian employing businesses has risen significantly since the early 1990s. Computer use has grown fairly steadily, rising from 49% of businesses in 1993-94 to 63% in 1997-98 and 76% in 1999-2000. Internet use grew more rapidly between 1997-98 and 1999-2000, the proportion of businesses with Internet access almost doubling from 29% to 56%. The proportion of businesses with Web sites or home pages more than doubled over the same period (from 6% to 16% of businesses).


Extent of use of information technology by Australian businesses

The extent to which Australian businesses use information technology is related to business size and industry. At June 2000, 100% of large businesses (those with employment of 100 or more persons) used a computer, 95% had access to the Internet and 68% had a Web site or home page. Very small businesses (those with employment of fewer than 5 employees) had much lower adoption of information technology at June 2000, with 69% using a computer, 49% having Internet access and only 9% having a Web site or home page.

Computer use and Internet access were highest in the Property and business services and Electricity, gas and water supply industries at June 2000. At least 85% of businesses in these two industries used computers and at least 76% had access to the Internet. Computer and Internet use was lowest in the Personal and other services industry, where 60% of businesses used a computer and 39% had Internet access. Web site use was highest in the Electricity, gas and water supply industry, with 56% of businesses having a Web site or home page, and lowest in the Construction industry (6% of businesses).


Employment of information technology staff by businesses

At June 2000, 17% of all businesses in Australia employed their own information technology staff (including Web design staff). A higher proportion of large businesses employed information technology staff than smaller businesses, some 68% of businesses with employment of 100 or more persons having information technology staff compared with 13% of businesses with employment of fewer than 5 persons. The percentage of businesses with information technology staff ranged from 46% in the Electricity, gas and water supply industry to 10% in both the Construction and Personal and other services industries.



24.9 BUSINESS USE OF SELECTED INFORMATION TECHNOLOGIES - At 30 June 2000(a)

Number of
businesses
Businesses with
IT staff
Computers
Internet
access
Web site or
home page
'000
%
%
%
%

Employment size -
1-4 persons
415
13
69
50
9
5-19 persons
184
22
85
65
24
20-99 persons
36
38
97
83
46
100 or more persons
6
68
100
95
68
Industry -
Mining
2
19
82
70
30
Manufacturing
54
20
79
60
23
Electricity, gas and water supply
-
46
85
79
56
Construction
90
10
68
46
6
Wholesale trade
45
21
83
62
22
Retail trade
112
12
68
42
15
Accommodation, cafes and restaurants
32
12
61
40
19
Transport and storage
32
13
64
46
14
Communication services
4
17
77
42
17
Finance and insurance
23
18
81
71
19
Property and business services
149
29
88
76
19
Health and community services
51
14
83
57
9
Cultural and recreational services
17
15
81
63
26
Personal and other services
30
10
60
39
19
Total businesses
641
17
76
56
16

(a) Proportions are of all businesses in each category.

Source: Business Use of Information Technology, Australia,1999-2000 (8129.0).


Business use of the Internet

At June 2000, 28% of businesses with access to the Internet were engaged in activities associated with selling goods or services to customers. This included receiving orders, sending invoices and providing after sales service. Of businesses with Internet access, 24% used it for activities associated with buying goods or services such as ordering from suppliers, purchasing information on-line or receiving invoices. Over a third (36%) of businesses with Internet access were using on-line banking facilities. A fifth (20%) of businesses were using Internet access only for email and/or information searches.


Business use of Web sites

The majority of businesses with Web sites or home pages at June 2000 used their site to display company information (88%) and/or advertise their goods or services (79%). An estimated 6% of businesses with Web sites offered secure access or secure transactions on those sites. While 14% of businesses with Web sites offered on-line ordering, only 3% of businesses with Web sites used shopping cart software and only 5% had an on-line payments facility. The integration of Web site technology with back-end systems, such as existing accounting and stock control software, occurred in only 4% of businesses with a Web site or home page.



The significance of Internet commerce in Australia

The estimated total value of sales/orders received by businesses via the Internet for the year ending 30 June 2000 was $5.1b. This represented approximately
0.4% of total sales/orders received for goods and services by Australian businesses in that financial year. While Internet commerce accounted for only a very small proportion of total sales/orders, it was dominated by business to business transactions.

Of the 38,000 'Internet commerce active' businesses estimated to be receiving sales income via the Internet in 1999-2000, 39% generated less than 1% of their sales in this manner. A further 27% generated between 1% and 5% of their total sales via the Internet, while 34% of businesses generated 5% or more of their total sales via the Internet. Only 2% of businesses generated 50% or more of their sales via the Internet.


Barriers to greater use of information technology by businesses

While the level of use of computer and Internet technology appeared to be relatively high among Australian businesses by June 2000, one in four businesses did not use a computer and nearly half of all businesses did not have access to the Internet. Use of Web sites was much lower, with 84% of businesses not having one. It is clearly of interest to know why a portion of businesses were not embracing information technology at even the most basic level.

The largest barrier to using information technology, whether a computer, the Internet or a Web site, was the perception by the business that the technology was 'not suited to the nature of the business'. This finding is consistent with results obtained at the end of June 1998, when
63% of businesses without a computer identified computer use as not suited to the nature of the business and 60% of businesses without Internet access identified it as not suited to the nature of the business.

At June 2000, nearly half (47%) of the businesses not using a computer reported that computer use was not suited to the nature of the business, while just over a third (36%) identified lack of skills or appropriate training as a barrier to computer use. For businesses with a computer but without Internet access, the most frequent reason givenwas that Internet access did not suit the nature of the business (54%), followed by a lack of interest in Internet access (26%). The most frequent reason given for not using a Web site or home page within a business was again that it did not suit the nature of the business (53% of businesses using a computer were without a Web site/home page).


Factors limiting further development of business Web sites

Of those businesses with a Web site or home page at June 2000, 44% were satisfied with its functions. For other businesses, the factors which most limited the further development of their Web site or home page were the cost of further development, the low rate of use of Internet commerce by customers or suppliers, and lack of skills. These factors were identified by 33%, 26% and 24% of businesses with Web sites or home pages respectively.


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