Core arguments and facts of the 2018 Benchmark Report: Innovation and Skills
21 Feb 2018
- Benchmark Report
- Australian Economy
Innovation and Skills
is one of the five major reasons for investing in Australia underlined in
Austrade’s 2018 Benchmark Report (BMR)
(in previous posts I covered
Dynamic Industries). Under this heading, the BMR also highlights our world-class scientific
and academic institutions, our strong commitment to research and
development (R&D), and the availability of Australia’s highly educated,
multicultural and multilingual workforce.
Australian policymakers and businesses recognise the contribution of
science and innovation to the nation’s growth, economic prosperity and
ability to create the jobs of the future, and as a result Australian
expenditure on R&D is one of the fastest growing in the world.
Moreover, the country’s services-based workforce has expertise in a range
of sectors, including world-leading niche capabilities in new disruptive
technologies such as automation, immersive simulation and quantum
International organisations have numerous opportunities to collaborate with
Australian research institutions, invest in or incorporate Australian
solutions into existing products, or enter into joint ventures to take them
to the global market.
Below is one of the BMR charts
that shows how Australia compares with leading OECD economies across a
selection of indicators relevant to the innovation and skills theme:
- Australia’s secondary education
enrolment rate is the world’s fourth highest and the tertiary education
enrolment rate the fifth highest, according to the World Economic Forum’s Global Competitiveness Report 2017–18.
- Australia has a highly educated
workforce with the skills to service a diverse range of industries. Australia’s
knowledge- and technology-intensive industries add more value to its economy
than the knowledge- and technology-intensive industries of France, Germany,
Japan and South Korea.
- The quality of Australia’s
infrastructure, human capital and research, and scientific research
institutions are all ranked in the world’s top 10.
- Australia also ranks second in the United Nations Development
Programme’s Human Development Report 2016, which measures a country’s
human, physical and educational wellbeing based on years of schooling, life
expectancy and income.
Australia’s annual gross expenditure on research and experimental
development (GERD) is one of the fastest-growing in the world, having risen
about eight per cent per annum between 2000–01 and 2015–16. Business
expenditure on R&D accounts for 54 per cent of Australia’s total
R&D expenditure, expanding from A$5 billion in 2000–01 to about A$17
billion in 2015–16 – a compound annual growth rate of over eight per cent
- Australia’s annual GERD was estimated to be around US$23 billion (on
current purchasing power parity terms), according to the latest
calculations of the OECD.
 This represents an average growth rate of 8.5 per cent a year since 2000,
well above the OECD average rate of 4.9 per cent. In relative terms (that
is, researcher per thousand employment versus GERD as a % of GDP),
Australia’s GERD places it among the world’s leading innovative countries,
including the USA, Japan, Germany and South Korea.
- Australia has six universities in the top 100 in the
Academic Ranking of World Universities
: the University of Melbourne, the University of Queensland, Monash
University, the University of Sydney, the University of Western Australia
and the Australian National University. The number of Australian
universities listed on the ARWU top 500 rankings has increased from 14 in
2004 to 23 in 2017.
Australia’s scientific research publications averaged a relative impact
of at least 20 per cent above the global average in almost 82 per cent of
the 22 scientific research fields in the Essential Science Indicators
classification. Australia’s seven strongest categories of published
research – physics, space science, multidisciplinary, computer science,
clinical medicine, engineering and environment/ecology – reflect the
country’s diverse research interests.
- Australia’s research sector shows a strong collaboration performance on a
range of indicators, according to the
Australian Innovation System Report 2017
In the proportion of the world’s top one per cent of highly cited
publications that have an international co-author, Australia ranked seventh
across all disciplines, fifth for Humanities, Arts and Social
Science and eighth for Natural Sciences and Engineering among 38 OECD+
countries from 2013–15. During the same period, almost half of the
publication output from Australia’s top ten universities (ranked by
publication output) had an international co-author (43–50 per cent).
Australia’s highly educated, multicultural and multilingual workforce has the smarts and skills to drive innovation and grow international businesses.
- Eighty-eight per cent of Australians are employed in the services sector.
Over 40 per cent or five million people work in sectors where tertiary
education is standard for many employees, including education and training;
professional, scientific and technical services; financial and insurance
services; health care; information media and telecommunications; and public
administration (see chart below).
- Australia has the third highest number of researchers in the government
and higher education sector per thousand workers out of OECD+ countries.
Australia also had relatively high levels of higher degrees by research
graduates, with 11.7 doctorate holders per thousand people in the
- International companies can tap into a multilingual workforce across
Australia. Almost 30 per cent of Australia’s 12.2 million-strong employed
persons were born overseas. Many foreign-born employees are from Asia or
Europe, enriching Australia’s reputation for culturally diverse workplaces
and boosting the nation’s competitive edge in international business.
- Twenty-seven per cent (or 6.4 million) of the nation’s population speak
an Asian or European language. Almost 3.2 million (or one in seven)
Australians speak an Asian language – more than 900,000 speak a Chinese
language and 800,000 speak a Southern Asian language – and 1.4 million
Australians speak a European language.
While the BMR emphasises that Australia already demonstrates a range of
strong innovation credentials, Innovation and Science Australia (ISA) has
recently released its report to the government,
Australia 2030: Prosperity through Innovation
– a plan for Australia to thrive in the global innovation race. The ISA
Board was tasked by the government to produce a strategic plan to advise
policy makers on how to accelerate innovation, science and research and
optimise Australia's innovation system out to 2030.
makes 30 recommendations for governments to help achieve this goal and has
identified five urgent imperatives for action across the innovation system
in Australia. These imperatives include education, industry, government,
research and development, and culture and ambition. Within these
imperatives, the Plan describes specific opportunities where governments
can exercise leadership and influence to accelerate the nation's innovation
performance out to the year 2030.
ISA has developed a strategy looking out to 2030 to advise the Australian
Government on how to generate and capture more of the benefits of
innovation for Australians. The strategy makes 30 recommendations which are
framed in the context of five strategic imperatives.
Austrade’s Why Australia Benchmark Report 2018 (BMR
2018), page 28
 BMR 2018, page 30
Main Science and Technology Indicators
(Data extracted on 19 Feb 2018 from OECD. Stat)
 BMR 2018, Chart: Leading Economy for R&D Expenditure, page
 BMR 2018, Chart: Top Ranking Academic Institutions, page 32
 BMR 2018, Chart:
Relative Impacts of Australian Scientific Publications by Research
Field – 2012–16
, page 31
 Department of Industry, Innovation and Science,
Australian Innovation System Report 2017
, 2. Skills and capabilities, page 19
 OECD+ includes all 35 member countries of the OECD, as well China,
Taiwan and Singapore (where data is available)
 Ibid, page 87
 BMR 2018, Chart: Culturally Diverse Labour Force, page 33
 BMR 2018, Chart:
a Multilingual Population
, page 35