1504.0 - Methodological News, Dec 2004  
ARCHIVED ISSUE Released at 11:30 AM (CANBERRA TIME) 05/01/2005   
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As a response to strong external demand for longitudinal statistics on business activity and performance, the Australian Bureau of Statistics (ABS) has undertaken to create a Business Longitudinal Database (BLD). One of the primary aims of the BLD was to use data from existing sources (both internal and external such as Australian Taxation Office (ATO) data), however after consultation with potential users the need for data relating to business characteristics was emphasised. This meant that to populate the BLD with relevant data, a specific collection will be required to supplement data available from current ABS characteristic surveys, such as the new Innovation survey.

Based on discussions with external and ABS analysts, the preference for the BLD is a smaller-denser dataset rather than a larger-sparser dataset. That is, a dataset which is smaller in terms of sample size yet denser in terms of data items. This is because the richness of data across time from particular businesses is seen as more desirable than large samples with less data. In such a dataset all data items are available for all selected businesses for all time periods covered by the survey (the 'want it all principle'). This is a rather broad-brush description however, which masks the dilemma for dataset designers who need to resolve a number of difficult issues. Even if it is accepted that the ideal longitudinal dataset is one which is dense with information, there are many other characteristics that describe the dataset that also need to be considered. These include the sample size, sample distribution, number, spread and complexity of data items, number of waves, reference period covered and interval between waves.

Many of these will have no one solution, and in different situations a decisions on what is needed to produce a "good" dataset will vary. Decisions were made for the BLD based on discussion with various analysts, and with consideration of practical influences such as ABS provider load policy.

The final design determined for the BLD is an equal allocation at the Australia, New Zealand Standard Industry Classification (ANZSIC) Division by broad size level. The initial sample taken in the first year will be large enough to allow for deaths over time, so that by the end of the fifth year there will be sufficient live units available for analysis. The size of this sample will be determined by further consultation and budget constraints. The proposal to retain units in sample for five years was made with consideration to the minimum useful time suggested by analysts, and the current ABS policy on provider load. In each subsequent year a new panel of units will be added to the BLD and then followed for five years.

This method of adding a new panel each year ensures that for any five year period of interest there will be units available for analysis, but also relieves provider burden by not retaining the same units in the BLD year after year. The aim is as much as possible that the units included in the BLD will be taken from ABS characteristic surveys to minimise the size of the specific BLD collection.

For further information, please contact, Helen Teasdale on (08) 9360 5991

Email: helen.teasdale@abs.gov.au.