Australian Defence Industry Account, experimental estimates

Latest release

Estimates of the defence industry's direct contribution to the Australian economy

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Reference period
2022-23 financial year

Key statistics

In 2022-23, the Australian defence industry:

  • contributed $10.6b (0.44%) to Australia’s gross value added, up 4.1% from the previous year
  • employed 64,100 persons, up 6.3% from the previous year
  • consisted of 5,544 Australian businesses

Broad overview

The Australian Defence Industry Account (ADIA) is a satellite account that measures the direct economic contribution and direct employment headcount of the defence industry to the Australian economy.

Australian defence industry

The Australian defence industry represents the production of goods and services invoiced to the Department of Defence. For example, if a vehicle manufacturer supplies vehicles both to Defence and the broader economy, only the activity associated with Defence is captured.

For an activity to be included, there must be a direct relationship between the Department of Defence and the supplier of the good or service. Only the direct defence industry contributions and employment are included.

Total defence industry GVA

Gross Value Added (GVA)

GVA represents the additional economy value added through the creation of a product or the provision of a service. It removes the costs of intermediate inputs used to create the product or service from the amount received by the seller. It is the standard indicator to assess the contribution of an industry or sub-sector to the broader economy.

Gross value added (GVA) from Defence expenditure contributed $10.6b to the Australian economy in 2022-23. This was an increase of 4.1% from the previous year, following a 17.7% increase in 2021-22.

Over the period 2016-17 to 2022-23, the defence industry’s contribution to the Australian economy grew from $6.2b to $10.6b, an increase of 71.1%. Over the same period, total economy GVA grew by 47.0%.

Defence expenditure contributed 0.44% of the total economy’s GVA in 2022-23.

(a) Source: Australian System of National Accounts, 2022-23.

(b) This contribution does not reflect the total contribution of the Defence portfolio to the Australian economy. It only captures the GVA generated by the invoiced expenditure made by the Department of Defence within the scope of the Australian economy.

Industry overview

In 2022-23, the three largest industry contributors to defence industry GVA were:

  • Professional, scientific and technical services with 45.2% of GVA
  • Manufacturing with 15.4% of GVA
  • Construction with 15.0% of GVA

Combined, the top three industries account for 75.6% of the total defence industry GVA.

Spending in the defence industry is often linked to construction and manufacturing projects. However, the planning and delivery of these projects involve engineering, computer system design and technical expertise. This expertise is part of Professional, scientific, and technical services.

*Note: Wholesale trade; Accommodation and food services; and Health care and social assistance are suppressed due to confidentiality requirements. These are noted as np (not publishable) in the table.

At the subdivision level the main contributors to defence industry GVA were:

  • Professional, scientific, and technical services (except computer system design and related services) (29.0%)
  • Computer system design and related services (16.2%)
  • Transport equipment manufacturing (12.3%)
  • Building construction (7.7%)

State overview

In 2022-23, the three largest state contributors to defence industry GVA were:

  • New South Wales ($3,432m)
  • Victoria ($2,249m)
  • South Australia ($1,684m)

The states with the largest defence industry GVA growth between 2021-22 and 2022-23 were:

  • New South Wales (up $370m, 12.1%)
  • South Australia (up $125m, 8.0%)
  • Western Australia (up $58m, 14.1%)

State by industry overview

In 2022-23, the Professional, scientific, and technical services industry was the largest contributor to defence industry GVA in all states, except Western Australia, where the Manufacturing industry was the largest contributor, and the Northern Territory, where the Construction industry was the largest contributor.

*Note: Some industries in these states have been suppressed due to confidentiality requirements. These are noted as np (not publishable) in the table.

Business counts

Nationwide, 5,544 Australian businesses contributed to the Australian defence industry in 2022-23. The main contributors were:

  • Professional, scientific and technical services (1,577 businesses)
  • Manufacturing (918 businesses)
  • Education and training (498 businesses)

Note: Other industries include Agriculture, forestry and fishing; Mining; Electricity, gas, water and waste services; Wholesale trade; Retail trade; Accommodation and food services; Transport, postal and warehousing; Information media and telecommunications; Financial and insurance services; Rental, hiring and real estate services; Administrative and support services; Public administration and safety; Health care and social assistance; and Arts and recreation services.

Employment overview

Defence industry direct employment

The number of paid employees (both full and part time) working for a business is known as the "employee headcount". The employment headcount is the normal level headcount annualised through the year to create a representative timeseries.

Direct employment in the defence industry refers to the number of employees associated with the defence industry.

Employment associated with defence expenditure increased by 3,800 (6.3%) from 60,300 in 2021-22 to 64,100 in 2022-23. In comparison, total employed persons in Australia grew by 4.6%.

In 2022-23, defence contributed 0.45% of the economy’s total employment (sourced from Labour Account, Australia original annualised series).

The top employing industries in 2022-23 were:

  • Professional, scientific, and technical services (21,400 or 33.4%)
  • Construction (14,200 or 22.2%)
  • Manufacturing (10,400 or 16.2%)

Combined, the top three industries consistently contribute more than 70% of the total defence industry employment between 2019-20 and 2022-23.

*Note: Wholesale trade, Accommodation and food services, and Health care and social assistance are suppressed due to confidentiality requirements. These are noted as np (not publishable) in the table.

The states with the highest direct employment headcount in 2022-23 were:

  • New South Wales (22,700, or 35.4% of the total)
  • Victoria (13,600, or 21.2%)
  • South Australia (9,500, or 14.8%)

The largest increases in direct employment headcount 2022-23 were in:

  • New South Wales (up 2,000)
  • South Australia (up 900)
  • Queensland (up 700)

Revisions

Users should be aware that there are some revisions in this release due to changes in the reported data and process improvements, including enhancements to product and industry coding.

Changes in this issue

Changes to this release include:

  • Business counts have been added. These can be found in table 14 and table 15.
  • The method used to allocate defence expenditure to industry has been updated. This has led to changes to the industry distribution for GVA and employment.

Refer to the methodology page for more information.

Data downloads

Australian defence industry data cube

Data files
Download xlsx [97.13 KB]

Methodology

Australian Defence Industry Account, experimental estimates methodology, 2022-23 financial year

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