Transcript Highlights of the latest quarters statistics (Powerpoint

ONS Economic Forum
Email: [email protected]
Twitter: @ONS
#ONSeconomy
Website: http://www.ons.gov.uk/ons/about-ons/getinvolved/events/events/economic-forum/index.html
8 October 2014
1
What’s new
Peter Patterson, Deputy Chief Economic Adviser
ONS Economic Forum
8 October 2014
2
Improvements
• Improvements to methods
• GNI reservations
• Continuous improvement
• New international frameworks
(ESA 2010, BPM6, MGDD)
• New data (from 2010 onwards)
3
Improvements to methods: Addressing
GNI reservations
• ‘GNI reservations’ largely about the level of GNI
but there is some impact on growth
• Articles published on 29 May
• Review of Non-Profit Institution serving
Households units (NPISH)
• Financial Intermediaries Services Indirectly
Measured (FISIM)
• Illegal Activities
• New Cars
• Own-account construction
• Exhaustiveness adjustments
4
Improvements to methods:
‘Continuous improvement’
• Gross Fixed Capital Formation
• Inventories
• Industry reviews
5
New International Frameworks
• ESA 2010 based on SNA 2008
• SNA 2008 already adopted worldwide
• ESA 2010 implemented from
September 2014 across all EU
Member states
• Balance of Payments Manual 6 –
mainly GDP-neutral
• Greater comparability, consistency
and relevance
6
New International Frameworks
• R&D
• Weapons
• Decommissioning costs
• Pensions
• Small Tools
• BPM6 changes
7
Summary of revisions to GDP
• Substantial increase in level of nominal GDP in all
years - on average 4.1% higher than before
• Little change to average annual real GDP growth
1997-2013 – up 0.1pp from 1.9% to 2.0%
• Bigger changes to individual years - range +0.9pp
(2009) to -0.9pp (2007)
• Slight downward revision to average annual growth
1997-2007, but upward revision (+0.5pp pa) to 20072012 . No change to 2013
• Slightly higher growth 1997-2013 is on average
entirely due to ESA 2010 changes ...
• .. but in 2008-2012 a result of a range of non-ESA
changes
8
Higher levels of nominal GDP
£ billion per quarter
450
Previously published
400
Blue Book 2014
350
300
250
200
1997 Q1
1999 Q1
2001 Q1
2003 Q1
2005 Q1
2007 Q1
2009 Q1
2011 Q1
2013 Q1
9
Real GDP growth
% changes on same quarter a year earlier, chained volume measure
8
Previously published
6
Blue Book 2014
4
2
0
-2
-4
-6
-8
1997 Q1
1999 Q1
2001 Q1
2003 Q1
2005 Q1
2007 Q1
2009 Q1
2011 Q1
2013 Q1
10
Real GDP – 2008-2009 recession
• Broad narrative of recession is little changed
• Timing and duration of recession unchanged
– peak 2008Q1, trough 2009Q2
• Peak-to-trough fall in output revised to 6.0%
(previously 7.2%) – remains within broad
range of previous estimates of around 6-7%
• Remains the deepest UK recession since
ONS records began in 1948
11
Real GDP – recovery since 2009
• Increase in real GDP between 2009Q2 and
2014Q2 revised from 8.0% to 9.3%
• Average annual growth rate up from 1.5% to
1.8%
• Upward revisions due to a range of factors changes to investment and inventories, new
data, and S&U balancing (2012)
• Relatively little impact from ESA 2010
changes (including R&D)
• Recovery remains the weakest on record
12
Comparison of UK recessions
Real GDP, index numbers, pre-recession peak = 100
115
1973Q2
1979Q2
110
1990Q2
2008Q1
105
100
95
90
0
1
2
3
4
5
6
7
8
9
10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25
Quarters following pre-recession peaks
13
Productivity (output per hour)
Index nos, 2008Q1 = 100
115
Previously published
110
Blue Book 2014
1997-2007 trend
105
100
95
90
85
80
75
1997 Q1
1999 Q1
2001 Q1
2003 Q1
2005 Q1
2007 Q1
2009 Q1
2011 Q1
2013 Q1
14
Changes to fixed investment (GFCF)
•
•
•
•
•
•
•
•
•
•
Capitalisation of R&D
Capitalisation of military weapons systems
Improvements to own-account construction
Inclusion of expenditure on small tools
New data from ABS for 2011 and 2012
Decommissioning costs for nuclear power plants
Supply and use balancing adjustments
Reconversion of survey data from SIC03 to SIC07
Revised data for land improvements
Other annual revisions to data sources
15
Total fixed investment (GFCF)
£ billion per year
300
250
200
150
100
50
BB14
BB13
0
1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
16
Revisions to GFCF by component
£ billion
60
R&D
50
weapons
40
OA
construction
30
ABS
20
small tools
10
terminal costs
0
other
-10
1997
1999
2001
2003
2005
2007
2009
2011
2013
total change
17
Contributions to GDP growth
10
8
Cumulative contributions of expenditure components to GDP growth since 2009Q2 (percentage points)
10
Previously published
Other
Net Trade
GFCF
HHFCE
Blue Book 2014
8
Net Trade
GFCF
HHFCE
GDP
GDP
6
6
4
4
2
2
0
0
-2
2009 Q2 2010 Q2 2011 Q2 2012 Q2 2013 Q2
Other
-2
2009 Q2
2010 Q2
2011 Q2
2012 Q2
2013 Q2
18
Gross operating surplus: PNFCs
£ billion per quarter
85
80
Previously published
Blue Book 2014
75
70
65
60
55
50
45
40
1997 Q1
1999 Q1
2001 Q1
2003 Q1
2005 Q1
2007 Q1
2009 Q1
2011 Q1
2013 Q1
19
Gross operating surplus – financial cos
£ billion per quarter
25
Previously published
Blue Book 2014
20
15
10
5
0
1997 Q1
1999 Q1
2001 Q1
2003 Q1
2005 Q1
2007 Q1
2009 Q1
2011 Q1
2013 Q1
20
Real households’ disposable income growth
% changes on previous year
7
6
5
4
3
2
1
0
-1
-2
1998
2000
2002
2004
RHDI annual growth (Blue Book 2014)
2006
2008
2010
2012
RHDI annual growth (previously published)
21
Changes to households’ saving ratio
Households’ saving as % of total available resources
14
12
10
8
6
4
2
0
1997
1999
2001
2003
Saving ratio (Blue Book 2014, %)
2005
2007
2009
2011
2013
Saving ratio (previously published, %)
22
Sectoral financial balances: BB14 changes
Net lending/borrowing, % of GDP
Blue Book 2014
10%
10%
5%
5%
0%
0%
-5%
-5%
-10%
-10%
-15%
-15%
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
15%
Public sector
Households
Financial corporations
Private non-financial corporations
Rest of the World
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
Previously published
15%
23
Current Account: key changes
Change
Rationale
Measurement of MFI profits on FDI
• debate on whether COP or AI better long standing one.
• Current Operating Performance (COP) rather
than All-Inclusive (AI) basis.
• COP recommended under BPM5, BPM6 mandates.
• holding gains and losses now excluded.
• evidence many countries already using COP. Better
international comparisons possible.
• COP used throughout the UK sector accounts so
improved coherence.
• capital gains removed as form of income – correct
treatment.
Measurement of FISIM
• FISIM business with non-resident financial
institutions now excluded.
• different reference rate used for exports.
• FISIM imports reduced in line with levels of
overseas loans & deposits to reflect change in
sectorisation of UK non-bank deposits with, and
loans from, banks in the rest of the world
introduced in Blue 2013.
• significant level of financial services between banks
relate to intra-bank funding, rather than provision of a
service to the real economy.
• implied interest rate charged on foreign loans with UK
banks better reflects margins of UK banks.
• improved coherence between FISIM imports and loans
& deposits data.
24
Current Account: key changes
Change
Rationale
Illegal activities
• illegal transactions exchanged with consent are included in
• measurement extended to include drugs.
the ‘production boundary’ so should be captured in the
National Accounts.
• all EU countries obliged to introduce for comparability
purposes.
Gambling
• introduction of estimates for ‘remote’
gambling
• on-line gambling an ever increasing e-service provided to
households.
• estimated that 90% of on-line gambling consumed in UK is
supplied from overseas.
Allocated non-monetary gold
• level of trade can be significant.
• estimated for first time.
• previously lack of available data but BoE developed
collection from main UK custodians of gold
• all gold other than where monetary
authorities have title and is held as reserve
assets (store of wealth).
25
Current account balance
Current account of balance of payments, % GDP
0.0%
-0.5%
-1.0%
-1.5%
-2.0%
-2.5%
-3.0%
-3.5%
-4.0%
-4.5%
-5.0%
1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
Previously published
Blue Book 2014
26
Revisions to current account balance
1.0%
Pink Book revisions to current account of balance of payments (% GDP)
0.5%
0.0%
-0.5%
-1.0%
-1.5%
-2.0%
-2.5%
-3.0%
-3.5%
1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
Revision to secondary income balance
Revision to primary income balance
Revision to trade balance
Revision to current account balance
27
International investment position
£ billion
150
100
50
0
-50
-100
-150
-200
-250
-300
1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
Revision
Previously published
Blue Book 2014
28
LFS re-weighting for 2011 Census
• Employment level (16+) increased
• Employment rate (16-64) virtually unchanged
to 2010; from 2010 slightly lower (up to
0.2pp)
• Unemployment level (16+) slightly higher but
rate (16+) virtually unchanged
• Inactivity level (16-64) increased
• Inactivity rate (16-64) virtually unchanged to
2010; from 2010 slightly higher (up to 0.2pp)
29
LFS re-weighting for 2011 Census
30
Contributions to productivity growth
Contributions (% points) to cumulative growth in output per hour since 2008Q1
2
1
0
-1
-2
-3
-4
-5
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2
2008
2009
2010
2011
2012
2013
ABDE¹
Manufacturing
Construction
Financial Services
Other Services
Whole Economy
2014
31
Output growth by sector
Average quarterly output growth, per cent
Transport
Admin & support
Construction
Wholesale & retail
Food, drink & tobacco
Metals
Real estate
Computer & electrical
Government services
Arts, entertainment and recreation
Rubber & plastic
Transport, storage & communication
Other services
Services
Total
Manufacturing
Machinery & equipment
Accommodation & food
Coke & petroleum
Professional services
Wood, paper & printing
Production
Information & communication
Textiles & clothing
Finance and insurance
Chemical & pharmaceutical
Mining and quarrying
-5%
Difference
Q2 2009-Q2 2014
Q1 1997 - Q1 2008
-4%
-3%
-2%
-1%
0%
1%
2%
32
3%
Job-to-job moves by reason
% of employees, 4 quarter moving average
3.0%
2.5%
2.0%
1.5%
1.0%
0.5%
0.0%
2003
2004
2005
Retirement or gave up work
2006
2007
Resignations
2008
2009
2010
2011
Dismissals and Redundacies
2012
2013
Other reasons
2014
Move Rate
33
Job-to-job moves by occupation type
% of employees, 4 quarter moving average
3.0%
2.5%
2.0%
1.5%
1.0%
0.5%
0.0%
2003
2004
2005
2006
2007
Non-response
Moves to higher occupations
Moves within medium occupations
2008
2009
2010
2011
2012
2013
Moves to lower occupations
Moves within low occupations
Moves within high occupations
2014
34
CPI inflation by import intensity
Contributions to CPI annual % change: percentage points
6
5
4
3
2
1
0
Data Unavailable
75-100%
25-50%
0%
-1
-2
2007
2008
2009
2010
2011
2012
Energy and fuel
50-75%
0-25%
CPI
2013
2014
35
85 class level components of CPI according to degree of import penetration in household consumption