5260.0.55.001 - Information paper: Experimental Estimates of Industry Multifactor Productivity, 2007  
Latest ISSUE Released at 11:30 AM (CANBERRA TIME) 07/09/2007  First Issue
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PRODUCTIVITY

10.1 ACCOMODATION, CAFES & RESTAURANTS MFP, LABOUR AND CAPITAL PRODUCTIVITY, (2004-05 = 100)
Graph: 10.1 ACCOMODATION, CAFES & RESTAURANTS MFP, LABOUR AND CAPITAL PRODUCTIVITY, (2004-05 = 100)

Multifactor productivity (MFP) measured on a value added basis in the Accommodation, cafes & restaurants industry decreased over the latter half of the 1980s, but from 1991-92 MFP has trended upwards (figure 10.1). There was zero average MFP growth from 1985-86 to 2005-06, and hence was considerably below the market sector average of 1.2% per year. A comparison of the gross output based MFP series to the value added based MFP series shows value added based MFP growing at a higher rate.


Growth in labour productivity shows a similar pattern to MFP over the period 1985-86 to 2005-06. There was a long decline from 1985-86 to 1991-92 followed by growth from 1991-92 to 2005-06 (figure 10.1). Overall, labour productivity increased at an average rate of 0.5% per year between 1985-86 and 2005-06.


Capital productivity in Accommodation, cafes & restaurants shows a similar pattern to labour productivity and MFP, with a significant decline from 1985-86 to 1991-92 followed by a period of solid growth from 1992-93 to 1994-95. Capital productivity has been relatively flat since 1994-95 (figure 10.1). Capital and labour inputs show a similar pattern of growth (figure 10.2), indicating that there is no significant level of capital-labour substitution in this industry. This may explain the similar movements in capital and labour productivity growth.


In Australia there has historically been minimal productivity growth in this industry. This is consistent with international results which show that among a significant number of developed economies there has been little productivity growth in this industry (Wölfl, 2003).


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