Every year, the Australian Bureau of Statistics Innovation provides a snapshot of innovation in the Australian business sector. The key message across key indicators of innovation activity: not much has changed over the past decade.
For example, the data obtained from surveys with Australian businesses and reported in the ABS Innovation in Australian Business series, show that over the past decade the proportion of Australian businesses engaging in any kind of innovation activity hovered at around 45%.
Likewise, the proportion of business that actually introduced new products or business processes remained fairly stable at close to 40% (38.3% in 2016-17; 39.1% in 2007-08).
There has also been little change in the make-up of activities. Most business innovations in Australia aim for improving business operations or the marketing of products. The production of new products, however, plays a minor role in the Australian business sector.
In 2016-17, only 17.4% of the surveyed busnesses introduced goods or services that were either new or improved, which compares to an average of around 20% over the previous decade.
Only 8% of the implemented goods and services were new to the world in 2016-17.
However, there are significant sectorial differences.
In Wholesale Trade, Retail Trade, and Information more than 30% of businesses were producing new goods and services, while more than a quarter (27%) of businesses in the Information media and telecommunications industry introduced goods and services that were new to the world.
But intricately linked with producing new products is investing in R&D, and on this measure the recent trend is down rather than up. According to ABS data, 2015-16 saw a sharp fall in business expenditure in R&D (BERD) of 12% in current price terms from 2013-14, led by the manufacturing and the mining industries.
And as a share of Gross Domestic Product (GDP), Australian BERD is indeed in a downward spiral, from a high above 1.35% in 2008-09 down to 1.01% in 2015-16 (see figure)
Recent reports on the Australian innovation system have highlighted a poor collaborative culture in the Australian business sector as a barrier to innovation and knowledge transfer. The ABS survey results reported in its 2018 Innovation in Business report underscore this.
It shows that in 2016-17 only a minor portion (18%) of businesses engaging in innovation were collaborating with partner organisations, of which most were from within the private sector (incl. other businesses, clients/customers, or suppliers of goods and services).
Engagement with research played a minor role, with universities accounting for only 5% of collaborations. Accordingly, there is still limited transfer of knowledge from research to the private sector. Innovating businesses sourced their ideas mainly from within the business sector, while only 2.4% used universities.
For the first time, the survey also explored potential barriers to collaboration, with innovation-active businesses most frequently indicating lack of time (19%) and insufficient funds (20%). However, more than half of the respondents could not point to any specific barrier.