Business Operations Survey: 2006

Commentary

Business Operations Survey

The Business Operations Survey collects information from a wide cross-section of New Zealand businesses in order to build a better understanding of a range of business practices and behaviours that may have some impact on business performance.

This is the first release of Business Operations Survey 2006 statistics. More information on business performance and operating environments will be published in a report in August 2007.
Data on businesses’ use of ICT will also be included in both a detailed report on ICT in New Zealand and the OECD Science, Technology and Industry scoreboard in late 2007.

Business operations

Businesses exporting

Sixteen percent of businesses had export sales in their last financial year, which is similar to the 2005 results. The percentage of businesses with exports sales of $25 million or more increased from 12 percent in 2005 to 15 percent in 2006.

Graph, Distribution of Exporters.

The industry with the greatest increase was the transport and storage industry, followed by the wholesale trade industry. Fifty percent of exporters in the transport and storage industry had export sales of $25 million or more compared to 28 percent in 2005. Twenty-five percent of exporters in the wholesale trade industry had export sales of $25 million or more compared to 19 percent in 2005. (See table 1.)

Business operating environment

The environmental factor rated the best by businesses was their information and communications technology infrastructure, followed by their water and waste infrastructure and business networks.

Two factors were rated poorly – the skilled labour market and local body planning and regulatory processes.

Graph, Business Operating Environment.
The construction industry had the largest percentage of businesses that rated the skilled labour market as poor (52 percent). (See table 2.)

Foreign ownership

The electricity, gas and water supply industry had the highest percentage (33 percent) of businesses with some degree of foreign ownership. The finance and insurance, wholesale trade and communication services industries had more than 15 percent of businesses with foreign ownership.

The biggest change between 2005 and 2006 occurred in the mining and quarrying industry, where the percentage of businesses with foreign ownership reduced from 25 percent to 17 percent.

Graph, Businesses with Foreign Ownership.

Information and communication technology (ICT)

ICT penetration

Survey results show that 93 percent of businesses used computers and 91 percent used the Internet. Business use of ICT was previously examined in the analytical report Information Technology Use in New Zealand 2001. Comparison of results indicates the number of businesses using the Internet has increased by 12 percentage points. Most businesses use a broadband internet connection rather than dial-up. Fifty-seven percent of businesses use broadband only, 11 percent use dial-up only and 21 percent use both.

Graph, Penetration of Information and Communication Technology.

ICT security

The security measure used by the greatest proportion of businesses was regularly updated virus checking or protection software (88 percent). Regular back-up of critical data was next (80 percent) followed by a firewall (76 percent) and spam filter (67 percent).
Results vary across different industries, for example 79 percent of businesses in the finance and insurance industry use offsite data back-up compared to 21 percent in the accomodation, cafes and restaurants industry. (See table 5.)

Internet sales

Overall, 34 percent of businesses indicated that they used the Internet to receive orders for goods or services. The highest proportion was recorded in the transport and storage industry (48 percent).

Graph, Businesses Using the Internet to Receive Orders.

Nineteen percent of all businesses reported that up to 10 percent of their total sales were Internet sales. Six percent of all businesses indicated that up to 10 percent of their Internet sales were exports. (See table 6.)

ICT outcomes

The most common ICT outcomes were improved responsiveness to customers and improved efficiency of work flow processes. Over 50 percent of businesses indicated that ICT was important in achieving these outcomes. The ICT outcomes cited by the least number of businesses were reduced costs of entering new markets and shifted activitites to other businesses (both 7 percent). 

Graph, Outcomes of Information and Communication Technology.

Data on businesses’ use of ICT will also be included in both a detailed report on ICT in New Zealand and the OECD Science, Technology and Industry scoreboard in late 2007.

Employment practices

Employee training

Overall, 86 percent of businesses trained their staff during the previous financial year. Seventy-seven percent of those businesses trained their staff in health and safety, the most common type of training reported. Trade related and professional/technical training were the next most common types of training. Forty-nine percent of all businesses trained their staff in teamworking/communication, the least common type of training. 

Graph, Types of Employee Training.

Flexible working arrangements and other employment practices

The most common employment practice offered by businesses was flexible break times (78 percent), followed by employee participation in health and safety (74 percent). The practices offered by the least businesses were arrangements for some staff to work from home (20 percent) and childcare allowances or facilities (5 percent). 

Graph, Employment Practices.
Results vary considerably by industry, as highlighted in the table below. For more industry results, see tables 9 and 10.

Employment Practices
August 2006
Practice  Highest percentage Lowest percentage  
Industry Percent  Industry  Percent 
Performance reviews    Electricity, gas and water supply  100  Agriculture, forestry and fishing 43 
Part-time work  Health and community services  92  Construction  43
Employee feedback programmes  Education  79  Retail trade  21 
Working contracted hours  Education  62  Electricity, gas and water supply  17 
Childcare Education 32 Electricity, gas and water supply 0
 
Note: All counts (not percentages) in this survey were randomly rounded to base 3 to protect confidentiality, so actual figures may differ from those stated.

Changes to employment practices

The survey asked businesses to indicate the single most important employment practice change made over their last two financial years. Forty-seven percent of businesses made an employment practice change. The most commonly cited important change was made to training (32 percent), followed by occupational health and safety (28 percent).

Graph, Most Important Employment Practice Change.

Businesses that changed an employee practice were asked to indicate the reasons for making that change. Overall, the most common reasons were to improve business performance (55 percent) and to improve internal staff relations (43 percent). (See table 12.)

For technical information contact:
Julia Gretton
Wellington 04 931 4600
Email: info@stats.govt.nz