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Data sources and methods

Australian System of National Accounts: Concepts, Sources and Methods
Reference period
2020-21 financial year

The scope of measurement

19.29    The growth accounting framework is initially developed for measuring productivity in the private sector of the economy. As such, MFP statistics relate to selected industries rather than the whole economy. Ideally, MFP measures should cover all market economic activities, but this is only possible if all of the necessary data are available.

19.30    For this reason, official MFP estimates internationally are confined to particular industries in the private sector, with varying degrees of coverage depending on data suitability and availability. Statistics Canada terms their coverage as the business sector, and Statistics New Zealand labels their coverage as the measured sector. In Australia, the ABS labels the relevant group of industries as the market sector. This grouping is used to present economic statistics including MFP estimates in the ASNA.

The market sector

19.31    The market sector comprises sixteen industries under the Australian and New Zealand Standard Industrial Classification, 2006 (ANZSIC06); that is, from ANZSIC06 Divisions A to N, plus Divisions R and S. The detailed industries included in the market sector are as follows:

ANZSIC
DivisionIndustry
AAgriculture, Forestry and Fishing
BMining
CManufacturing
DElectricity, Gas, Water and Waste Services
EConstruction
FWholesale Trade
GRetail Trade
HAccommodation and Food Services
ITransport, Postal and Warehousing
JInformation, Media and Telecommunications
KFinancial and Insurance Services
LRental, Hiring and Real Estate Services
MProfessional, Scientific and Technical Services
NAdministrative and Support Services
RArts and Recreation Services
SOther Services

19.32    Under the Australian and New Zealand Standard Industrial Classification 1993 (ANZSIC93), the market sector consisted of twelve industries (Divisions A to K and P). Coinciding with the implementation of ANZSIC 2006, the ABS expanded the scope of the market sector to include four new services industries (Divisions L, M, N and S – see above). The expanded definition improves relevance in two key respects: it reflects the growing influence of services industries in the economy; and improves economic coverage.⁸⁰

19.33    While the new definition of market sector results in much improved coverage of the total Australian economy, the time span available for constructing meaningful productivity indicators is shortened. Productivity measures for the expanded coverage commence in 1994-95, when suitable output measures for the newly added industries become available. Prior to 1994-95, volume estimates of gross value added in Divisions L, M, N and S were derived (in part) using input indicators (such as hours worked).

19.34    Since the 2009-10 issue of ASNA, the ABS MFP statistics have been presented in line with the new definition of the market sector. As such, these productivity measures are based on significant changes in coverage, and do not represent updated estimates to past releases. The current estimates are not directly comparable to those published in past releases due to significant changes in coverage.

Twelve selected industries

19.35    The time span available for constructing meaningful productivity indicators is shortened while the expanded definition of the market sector results in much improved coverage of the total Australian economy. To accommodate user requirements for longer time series of MFP statistics, ABS continues to compile aggregate MFP statistics for the group of twelve selected ANZSIC06 industries (divisions A to K and R). Commencing 1973-74, this aggregate is the nearest approximation to the earlier definition of the market sector grouping under ANZSIC93, and is useful for analysing productivity performance from the perspective of a longer time series.

19.36    Both the market sector and twelve selected industries include all institutional sectors, as well as general government attributable to those industries. Conceptually, there is a strong justification for netting out the general government component of each industry because general-government activity is mainly not marketed. It has not been removed because of the difficulty of excluding general government components from outputs and inputs. In any case, general-government activity only accounts for a very small portion of most market-sector industries.

The non-market sector

19.37    The industries included in the 'non-market sector' are:

  • Public Administration and Safety;
  • Education and Training;
  • Health Care and Social Assistance; and
  • Ownership of Dwellings.

19.38    The production of these government-dominated industries largely comprises those goods and services which fall within the production boundary of the national accounts but are not for sale, or not sold at full market prices. Examples are the provision of government services which relate to the community as a whole, or for which no charge (or a purely nominal charge) is made. Ownership of dwellings is excluded from the market sector because no employment is associated with it.

19.39    Aggregate measures of labour productivity (gross value added per hour worked) are published for the total of all industries (including the non-market sector); for the market sector; and for twelve selected industries. Indexes of gross value added per hour worked are also published for each individual industry in the ASNA.

Endnotes

  1. As at 2010-11, the market sector represented approximately 80 per cent of total chain volume gross value added at basic prices. By comparison, the twelve selected industries aggregate represented approximately 60 per cent.