Innovation is a measure of the extent to which science and technology are used within businesses to create new products or to implement new processes for the provision of goods and services. Innovation surveys provide a wider measure of the innovation process than R&D surveys.
The ABS has conducted two surveys of innovation, the first in respect of 1993-94 and a second, more comprehensive survey, in respect of 1996-97. These surveys were based on the concepts and standard questions developed jointly by the OECD and Eurostat (the statistical office for the European community). While the main ABS innovation surveys obtained data from manufacturing businesses, exploratory surveys have also been conducted for the mining, agriculture, construction and telecommunications industries.
The total amount spent by manufacturing businesses on technological innovation during 1996-97 was estimated at $3.9b. About half of this was spent on R&D. See Innovation in Manufacturing, Australia (8116.0) and previous editions of Year Book Australia for further data from the innovation surveys.
An intermediate measure of innovation is number of patents obtained by Australian residents. Graph 25.16 shows the number of United States of America patents by Australian inventors during the period 1980-2000. Given the dominance of the United States of America market for innovative products, this is an indicator of Australian innovation. The number of such patents has grown significantly over this period, particularly since 1997, but remains well below that of several OECD countries of similar population.
Innovation depends on other aspects of what the OECD calls a 'knowledge-based economy', such as human capital and information and communications technology. In August 2002, the ABS published a framework for analysis, Discussion Paper: Measuring a Knowledge-based Economy and Society - An Australian Framework (1375.0). The aim of the framework is to enable assessment, through use of relevant statistics, of the degree to which Australia is a knowledge-based economy and society.