ABS finds business is spending more (up to $18.3 billion) on R&D

Thursday, 12 September 2013

The Australian Bureau of Statistics (ABS) said business spending on research and development (R&D) had grown to reach $18.3 billion in 2011-12, according to its latest report Research and Experimental Development, Businesses.

The ABS said that the increase (up by about 2% from the previous year) was driven by R&D expenditure across four industries. “We found that the major contributors to R&D expenditure were the manufacturing and mining industries, at 24% and 22% respectively,” said the ABS. “The financial and insurance services industry, and the professional, scientific and technical services industry each contributed 16%.”

Businesses in the mining industry reported the largest growth in R&D spend, increasing by $265 million over the last financial year, however the ABS found that the largest change in R&D expenditure for any industry was a decrease of $331 million for the manufacturing industry.

Almost half of all businesses (47%) reporting R&D expenditure in 2011-12 classified their field of research as being in the field of engineering. The next largest area of research was information and computing sciences, taking up around 30% of the 2011-12 R&D expenditure.

By state, the largest increase in R&D from 2010-11 was reported in Western Australia (up $320 million), followed by South Australia (up $215 million). The largest decreases were reported in Queensland (down $180 million) and Victoria (down $141 million).

The size of a business had an influence on expenditure on R&D, but was not spread out in a consistent pattern. For instance, businesses with up to four employees and those with between 20 and 199 employees recorded increases in R&D spending for 2011-12, while businesses with between five and 19 employees and those with 200 or more employees both recorded decreases.

The largest dollar increases (up $378 million, or 11%) were found in businesses with 20 to 199 employees, followed by businesses with up to four employees (up $147 million, or 18%). Conversely, businesses with 200 or more employees recorded the largest reduction in dollar amount spent (down $187 million, or 2%), followed by businesses with between five and 19 employees (down $23 million, or 2%).

The business sector remained the principal source of funds for R&D in 2011-12, with $17,532 million (96% of the total R&D spend) coming from a business’s own funds and $184 million (1% of the total) from other businesses (although the latter showed the biggest decrease as a funding source). The federal government and overseas sources were the next largest funders.

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