industry sector waste generation per $ of gross value added
A high-level metric for tracking the waste intensity of an industry over time.
Scope: industry-level (e.g. retail, mining, manufacturing)
Who this metric is interesting to: industry bodies, industry participants and policy makers
Calculation method: the total amount of waste that an industry generates (tonnes/year) divided by its gross value added (GVA - $millions/year)
Definition of Gross Value Added (GVA) : reflects the value generated by producing goods and services, and is measured as the value of output minus the value of intermediate consumption (source: OECD).
What it tells you
Tracking the waste generation of an industry per million dollars of GVP tells you if it is becoming more (or less) waste intensive over time.
Waste generation is an indicator of circularity, i.e. the less waste, the more circular the system or industry is.
Limitations
All wasted resources are treated equally on a weight basis. For example, a tonne of soil is treated the same as a tonne of aluminium. This approach doesn’t recognise differences in the economic value (or environmental value) of wasted resources.
Some industries are inherently more waste intensive than others. For example, manufacturing is more waste intensive than administrative services. Hence it is not helpful to benchmark the performance of industries against one another using this metric. Rather, this metric is helpful for tracking the waste intensity of a given industry over time.
Practicality of measuring
Data on GVP by industry sector is typically published in national accounts.
On the other hand, waste generation data at the industry level may be difficult to obtain.
This may be estimated by doing a waste generation survey with a representative sample of a sector, and then extrapolating to estimate industry-wide generation for that sector.
Some countries are beginning to report the waste intensity of industries. For example, the Australian Bureau of Statistics has started publishing waste intensity values as part of its experimental waste accounts. See dataset here and figure 1 below showing the waste intensity (tonnes per $ million of GVP) by industry sector.
Figure 1: reproduced from the Australian Bureau of Statistics (Waste Account, Australia, Experimental Estimates). This chart shows the waste intensity of different industry sector in tonnes per $million of GVP.
Leaving thoughts
This metric is helpful for tracking the waste intensity of a given industry over time to see how it changes in response to policy measures and/or other drivers. One of its biggest limitations is that all wasted resources are treated equally on a weight basis. A more sophisticated method would be to measure the economic ($) and environmental (e.g. greenhouse gas emissions) value of the resources that are wasted by a given industry - per $ GVP. Nonetheless, this metric provides a high-level picture of how many resources are wasted for every dollar of value added by an industry.