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The major source for the statistics in this section is the Economic Activity Survey (EAS) of employing businesses conducted by the Australian Bureau of Statistics (ABS). Businesses in this collection are classified on the basis of their predominant activity, using the 1993 edition of ANZSIC.
The generally close relationship between share of employment and contribution to IVA is indicated in graph 18.4. The three largest industry subdivisions for both employment and IVA - machinery and equipment manufacturing; food, beverage and tobacco manufacturing; and metal product manufacturing - employed 57% of the manufacturing workforce in 2000-01 and contributed 58% of IVA.
State distribution of activity
In 2000-01 New South Wales and Victoria continued to be the largest contributors to manufacturing IVA, each accounting for 32% of total manufacturing IVA (table 18.5). New South Wales contributed 40% of the total IVA of the printing, publishing and recorded media industry and between 26% and 33% of the total IVA of the remaining manufacturing industries. Victoria contributed 50% of the total IVA of the textile, clothing, footwear and leather manufacturing industry, 39% of the total IVA of the machinery and equipment manufacturing industry and between 24% and 37% of the total IVA of the remaining manufacturing industries.
Although Queensland accounted for 14% of overall manufacturing IVA, it contributed 17% for both metal product manufacturing and food, beverage and tobacco manufacturing. The contributions of South Australia and Western Australia to total manufacturing IVA were similar at 8.6% and 9.4% respectively, although the structure of the manufacturing industry was very different. Machinery and equipment manufacturing was the largest manufacturing industry in South Australia, accounting for 29% of state production and 13% of the total IVA for the industry. South Australia also contributed between 5.9% and 11% of the total IVA of the remaining manufacturing industries. Western Australia contributed 17% of total IVA for metal product manufacturing and 13% of non-metallic mineral product manufacturing. Metal product manufacturing was the largest manufacturing industry in the state, accounting for 34% of state production.
Manufacturing was not as significant for the remaining state and territories. Tasmania, which accounted for 2.4% of total manufacturing IVA, contributed 6.6% of total IVA for wood and paper product manufacturing. The shares of national production for the Northern Territory and the Australian Capital Territory were each less than 1%.
Graph 18.6 shows relative contributions to overall manufacturing production by states and territories in 2000-01. Victoria and New South Wales contributed approximately two-thirds of total manufacturing production between them.
Table 18.7 shows the manufacturing industry's contribution to state production. The trend for the manufacturing industry's share of total production in all states has generally been decreasing, even though Australian manufacturing production grew by more than 34% at current prices between 1994-95 and 2002-03. This is because the growth in manufacturing production has been at a slightly slower rate than the growth in other industries.
Table 18.8 shows the IVA and employment of the manufacturing industry in each state and territory. Victoria and New South Wales were the major contributors to manufacturing employment, accounting for 32% and 31% respectively of total manufacturing employment. Together they accounted for almost two-thirds of total manufacturing employment at 30 June 2001. In all manufacturing industries, either New South Wales or Victoria was the largest employing state.
The proportions contributed by Victoria to persons employed in the various industries ranged from 26% for metal product manufacturing to 47% for textile, clothing, footwear and leather manufacturing while New South Wales' contributions varied from 26% for textile, clothing, footwear and leather manufacturing to 39% for printing, publishing and recorded media manufacturing.
Machinery and equipment manufacturing was the largest manufacturing employer in New South Wales (where it accounted for 20% of the state's manufacturing employment), Victoria (23%) and South Australia (33%). The largest industry employers in the other states and territories were food, beverage and tobacco manufacturing in Queensland (27%) and Tasmania (31%); metal product manufacturing in Western Australia (21%) and Northern Territory (36%); and printing, publishing and recorded media in the Australian Capital Territory (39%).
Total manufacturing IVA per person employed ranged from $67,000 in the Australian Capital Territory and South Australia to $91,000 in the Northern Territory and Western Australia (table 18.8). This difference could be attributed to the industry mix within each state or territory. For instance, the relatively capital intensive petroleum, coal, chemical and associated product manufacturing, which made up a significant proportion of Western Australia's manufacturing production, had a much higher IVA per person than textile, clothing, footwear and leather manufacturing, which was a relatively small industry in Western Australia.
The number of full-time and part-time workers in each manufacturing subdivision is provided in table 18.9. The number of employed persons shown in table 18.9 differs from the employment figures in tables 18.3 and 18.8 mainly because it includes directors who are not paid a salary and self-employed persons such as contractors, owner/drivers, consultants and persons paid solely by commission without a retainer. These categories are excluded from the employment figures in tables 18.3 and 18.8.
In May 2004 the manufacturing industry employed 11% of total persons employed. Males outnumbered females by a ratio of almost 3:1 (74% males and 26% females). The majority of people employed in the manufacturing industry were employed full time (94% of males and 70% of females), which is higher than the proportion of people employed full time in all industries (85% of males and 54% of females).
The largest employers of males were machinery and equipment manufacturing (193,500) and metal product manufacturing (133,000). The largest employers of females were food, beverage and tobacco manufacturing (56,100) and machinery and equipment manufacturing (47,600).
Further information on employed wage and salary earners and the characteristics of the manufacturing labour force is provided in Chapter 6 Labour.
Table 18.10 presents information on average weekly earnings (i.e. ordinary time earnings plus overtime earnings) of employees in the manufacturing industry and all industries. Between May 1984 and May 2004 the average earnings of full-time employees increased by 169% in the manufacturing industry, which was slightly higher than the increase of 157% for all industries. The earnings of both male and female full-time employees in manufacturing increased but the increase for female employees was 21 percentage points more than the increase for male employees, although female earnings came from a lower base and are still well below average male earnings. In the manufacturing industry the average weekly earnings for male full-time employees at May 2004 was higher by 29% than female full-time employees. In May 1984 male full-time employees were earning 39% more than female full-time employees.
Operating profit before tax
The operating profit before tax (OPBT) earned by all manufacturing businesses. Industry subdivisions contributing most to manufacturing industry profits for 2000-01 were: metal product manufacturing ($3,842m or 25% of total manufacturing OPBT); food, beverage and tobacco manufacturing (24%); petroleum, coal, chemical and associated product manufacturing (14%); and machinery and equipment manufacturing (12%) (table 18.11).
Profits for five industry subdivisions were higher in 2000-01 than they were for 1995-96, although there were some significant movements in profits in the intervening years. Metal product manufacturing profits were much higher in 2000-01 than in 1995-96, but actually fell in 1996-97 and 1998-99 before recovering strongly in 1999-2000 (up 24%) and then even more strongly in 2000-01 (up 33%). Printing, publishing and recorded media profits, at $1,387m in 2000-01, were very similar to the $1,266m profit in 1995-96, but were 32% lower than the $2,044m profit for the manufacturing subdivision in 1999-2000.
Contribution by size of business
In this section, the performance of manufacturing businesses is examined in relation to the size of those businesses. Employing businesses have been classified as small, medium or large according to the number of people employed by the business at 30 June 2001. Businesses employing fewer than 20 persons have been classified as small, those employing at least 20 but less than 100 persons have been classified as medium, and those employing 100 or more persons have been classified as large businesses.
Large businesses employed more than 50% of the people working in the manufacturing industry, and their share of economic activity, as measured by income, profits and capital outlays, was around 75% (graph 18.12). Small businesses employed 24% of the manufacturing work force, but their share of manufacturing activity was much less significant, at around 11%.
The manufacturing industry was responsible for $11.0b of capital expenditure in 2000-01, which accounted for 14% of capital expenditure by businesses in all industries. Within manufacturing, the industry subdivisions with largest capital expenditure were: food, beverage and tobacco manufacturing (23% of total manufacturing capital expenditure); petroleum, coal, chemical and associated product manufacturing (20%); metal product manufacturing (18%); and machinery and equipment manufacturing (15%).
Capital expenditure by the manufacturing industry decreased by 5.4% over the period 1995-96 to 2000-01 (table 18.13).
A majority of manufacturing industry subdivisions recorded increases in capital expenditure over the 1995-96 to 2000-01 period - the largest increase was in printing, publishing and recorded media (up 72% or $387m). However, the increases were offset by decreases in expenditure mainly in metal product manufacturing (down 33% or $1.0b), and wood and paper product manufacturing (down 36% or $324m).
International trade by industry of origin
Exports by industry of origin
The manufacturing industry dominates Australia's value of exports by industry of origin, accounting for 57% of total exports in 2003-04 (table 18.14). The value of manufacturing exports is 42% higher in 2003-04 than it was in 1993-94. However, the share of total value of exports of the manufacturing industry has been trending down each year since the high of 65% in 1994-95.
Graph 18.15 shows the five main destinations for manufacturing commodities exported from Australia, during the period 1998-99 to 2003-04. The United States of America was the major destination of Australian manufacturing exports in terms of value, with $7.3b worth exported for 2003-04, down from $9.1b in 2001-02. Japan has moved from Australia's largest destination of manufactured goods in 1999-2000 to be about equal with New Zealand in 2002-03 and 2003-04, and behind the United States of America. The value of manufacturing exports to New Zealand rose from $5.2b in 1998-99 to $6.9b, in 2003-04.
Imports by industry of origin
The manufacturing industry accounted for 94% of Australia's value of imports by industry of origin during the period 1994-95 to 2003-04 (table 18.16). The value of Australia's imports of manufactured goods was 74% more in 2003-04 than in 1994-95.
Graph 18.17 shows the five main countries for value of manufacturing commodities imported to Australia, in the period 1998-99 to 2003-04. In each year of this period, Australia imported more manufactured goods from the United States of America than from any other country. The value of manufactured goods imported from China grew 150% from $6.0b in 1998-99 to $14.9b in 2003-04.