5260.0.55.004 - Experimental Estimates of Industry Level KLEMS Multifactor Productivity, 2013-14  
ARCHIVED ISSUE Released at 11:30 AM (CANBERRA TIME) 07/03/2016  First Issue
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ANALYSIS OF RESULTS

In 2013-14, positive KLEMS MFP growth was recorded by 10 of the 16 market sector industries on a gross output basis.

Graph Image for KLEMS PRODUCTIVITY GROWTH, By Market Sector Industries

Source(s): KLEMS PRODUCTIVITY GROWTH, By Market Sector Industries-MFP Growth



The strongest KLEMS MFP growth industries were Rental, hiring and real estate services (+2.5 percentage points), Administrative and support services (+1.9 percentage points) and Arts and recreation services (+1.8 percentage points). The largest decreases in KLEMS MFP growth were for Electricity, gas, water and waste services (-2.9 percentage points), Other services (-2.3 percentage points) and Transport, postal and warehousing (-1.3 percentage points).

Rental, hiring and real estate services recorded the strongest gross output growth (+8.5%) in 2013-14. The main contributor to growth in this industry was services (+4.7 percentage points), while other inputs recorded modest growth, resulting in strong KLEMS MFP (+2.5 percentage points). The growth in KLEMS MFP in 2013-14 continues the recent positive KLEMS MFP growth seen in this industry.

Arts and recreation services and Administrative and support services recorded strong KLEMS MFP growth (of +1.8 percentage points and +1.9 percentage points respectively). KLEMS MFP was the main contributor to gross output growth (of +1.6% and +1.1% respectively), with negative contributions from services (-0.2 percentage points and -0.1 percentage points respectively).

Electricity, gas, water and waste services saw strong contributions from capital, labour and intermediate inputs which outpaced subdued gross output growth (+0.3%), resulting in this industry recording a significant decrease in KLEMS MFP (-2.9 percentage points). KLEMS MFP growth for this industry has been negative for several years, however the decline should be interpreted with caution, see the Information Paper: Experimental Estimates of Industry Level KLEMS Multifactor Productivity (cat. no. 5260.0.55.003) page 24 for a brief discussion of measurement issues.

Mining had significant gross output growth (+6.0%) in 2013-14. This growth was largely driven by non-IT capital (+4.6 percentage points) and modest growth in both materials and services, resulting in only a modest increase in KLEMS MFP (+0.1 percentage points).

Graph Image for KLEMS MULTIFACTOR PRODUCTIVITY GROWTH, By Market Sector Industries

Source(s): Experimental Estimates of Industry Level KLEMS Multifactor Productivity


KEY FIGURES, By Market Sector Industries, Annual points contribution to growth 2013-14 (a)
Industry
Contribution to Gross Output Growth
Gross Output Growth
Capital
Labour
Intermediate Input
KLEMS MFP (b)
IT
Non-IT
Hours Worked
Composition
Energy
Materials
Services
Agriculture, forestry and fishing
0.75
0.01
0.42
0.63
0.02
0.35
1.17
-1.07
-0.77
Mining
6.00
0.03
4.59
0.06
0.03
0.40
0.41
0.36
0.12
Manufacturing
-1.40
0.01
-0.11
-0.34
0.07
0.14
-1.13
-0.08
0.05
Electricity, gas, water and waste services
0.26
0.06
0.76
0.98
-0.06
0.05
0.66
0.70
-2.91
Construction
2.42
0.02
0.27
1.02
0.10
0.14
0.17
0.83
-0.14
Wholesale trade
0.34
0.08
0.12
-2.67
0.23
0.07
-0.20
1.07
1.63
Retail trade
-2.28
0.14
0.37
-0.04
0.20
0.06
-0.70
-2.70
0.39
Accommodation and food services
3.10
0.00
0.01
-0.77
-0.09
0.06
1.42
1.74
0.72
Transport, postal and warehousing
-0.55
0.04
0.53
0.32
0.10
0.72
-0.32
-0.70
-1.25
Information, media and telecommunications
1.39
0.32
0.93
-2.03
0.05
0.24
0.25
-0.09
1.72
Financial and insurance services
5.57
0.45
0.17
0.55
0.15
0.05
0.11
2.46
1.64
Rental, hiring and real estate services
8.47
0.01
0.71
0.51
0.11
0.06
-0.09
4.66
2.51
Professional, scientific and technical services
2.50
0.08
0.25
-0.02
0.20
0.05
0.25
2.75
-1.05
Administrative and support services
1.14
0.02
0.01
-1.04
0.26
0.02
0.04
-0.10
1.93
Arts and recreation services
1.63
0.12
0.33
-1.40
0.01
0.00
0.96
-0.17
1.79
Other services
1.40
0.05
0.50
3.66
-0.27
0.01
0.66
-0.93
-2.28
(a) The reported percentage changes are based on natural log growth x 100.
(b) Gross output based MFP, quality adjusted hours worked basis

The two period average cost shares seen in the table below show the average contribution of each input to its respective industry. For example, services comprised a 32.8% share of Agriculture, forestry and fishing gross output in current prices. Note that cost shares have been averaged over 2012-13 and 2013-14.

Industry cost structures are very diverse. For 10 industries, intermediate inputs represented more than half of their total cost in 2013-14. Nine industries had services cost shares exceeding 40% in 2013-14, while Manufacturing stands out as being relatively more materials intensive. Transport, postal and warehousing and Manufacturing had the largest energy cost shares. Mining and Financial and insurance services are relatively more capital intensive, particularly in non-IT capital, whereas Administrative and support services, Other services, Retail trade and Professional, scientific and technical services are relatively more labour intensive.

Individual industries may also undergo structural change over time, for example, responding to changes in the relative prices of inputs. This can cause industry's cost shares to vary. A time series of cost shares is provided in the data cube for each industry.

TWO PERIOD AVERAGE COST SHARES, By Market Sector Industries, percentage, 2013-14 (a) (b)
Industry
Capital Services - IT
Capital Services - Non-IT
Labour Services (c)
Energy
Materials
Services
Agriculture, forestry and fishing
0.21
28.04
12.69
4.88
21.34
32.84
Mining
0.53
39.35
13.08
4.43
8.35
34.25
Manufacturing
0.60
9.18
18.07
9.77
45.24
17.13
Electricity, gas, water and waste services
1.46
28.70
15.86
4.79
4.90
44.29
Construction
0.63
8.35
21.87
1.73
23.31
44.12
Wholesale trade
1.85
14.00
32.09
3.89
7.08
41.08
Retail trade
2.18
14.58
43.32
2.35
6.92
30.65
Accommodation and food services
0.47
10.34
37.17
2.89
26.85
22.28
Transport, postal and warehousing
0.89
16.87
26.71
10.29
3.14
42.10
Information, media and telecommunications
2.43
25.80
17.49
2.28
5.35
46.65
Financial and insurance services
6.46
31.88
24.47
0.55
0.55
36.09
Rental, hiring and real estate services
2.68
25.46
20.49
2.30
1.24
47.83
Professional, scientific and technical services
2.60
8.14
40.02
0.83
1.42
47.00
Administrative and support services
0.57
1.81
50.47
0.44
2.75
43.97
Arts and recreation services
1.12
11.70
25.41
0.91
20.80
40.06
Other services
0.83
5.84
45.92
0.67
25.07
21.67
(a) Two periods represent t and t-1
(b) Percentages may not add to 100% due to rounding
(c) Combined Hours worked and Composition

Under a gross output based MFP approach, the contribution of each of the primary and intermediate inputs to output is weighted using the cost shares of each input. The cost shares for labour and capital are their respective primary incomes, divided by the current price value of gross output, while the cost shares for intermediate inputs are the expenditures on inputs, divided by the value of gross output. Refer to the Information Paper: Experimental Estimates of Industry Level KLEMS Multifactor Productivity (cat. no. 5260.0.55.003) for more information.

The estimates presented in this release are based on data used to compile the 2014-15 edition of the Australian System of National Accounts (Cat. no. 5204.0). At the time of this publication, KLEMS MFP contribution to growth estimates are only available for the period from 1995–96 to 2013–14.

REVISIONS

This release incorporates the following key revisions to those presented in the Information Paper: Experimental Estimates of Industry Level KLEMS Multifactor Productivity (cat. no. 5260.0.55.003):
  • revisions incorporated into the 2014-15 Australian System of National Accounts (cat. no. 5204.0).
  • revisions to bring the estimates into alignment with the Energy Account, Australia (cat. no. 4604.0). The Oil Supply Use Product Classification (07010) has been reclassified from materials to energy within intermediate inputs.
  • minor revisions due to the improved benchmarking of KLEMS data.