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Uploaded byOffice for National Statistics
ONS Regional Economic Forum - Glasgow
The document outlines the agenda and discussions from the ONS Regional Economic Forum held on May 24, 2022, which included insights on the UK economy, subnational statistics plans, and specific focuses on the Scottish economy. Presentations highlighted trends in economic growth, business investment, inflation, and the impacts of global events like the pandemic and the Russia-Ukraine conflict. Key takeaways included slow GDP growth, subdued business investment, and ongoing economic challenges affecting consumer confidence and trading conditions.
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ONS Regional Economic Forum - Glasgow
- 1. ONS Regional Economic Forum 24May 2022 @ONSfocus #economicforum
- 2. Deputy Chief Economist Officefor National Statistics @ONSfocus #economicforum Welcome Richard Heys
- 3. Agenda 14:00 – 14:05Welcome and introduction – Richard Heys, ONS 14:05 – 14:20 Understanding the UK Economy – Richard Heys, ONS 14:20 – 14:40 ONS plans for subnational statistics – Abbie Davies and Emma Hickman, ONS 14:40 – 15:00 Q&A 15:00 – 15:15 Coffee Break 15:15 – 15:35 Picture of the Scottish Economy – Sandy Stewart, Head of National Accounts, Scottish Government 15:35 – 15:55 ESCoE – Building a Suite of Subnational Socioeconomic Indicators for the UK: Opportunities, Challenges and Recommendations – Sharada Davidson, Fraser of Allander Institute, University of Strathclyde 15:55 – 16:05 Q&A 16:05 – 16:15 Closing remarks – Richard Heys, ONS @ONSfocus #economicforum
- 4. Deputy Chief Economist Officefor National Statistics State of the UK Economy May 2022 Richard Heys @ONSfocus #economicforum
- 5. Economic growth slowedin February & March Source: ONS – Monthly GDP Source: OECD and ONS first quarterly estimate -1 0 1 2 3 Mar 2021 May 2021 Jul 2021 Sep 2021 Nov 2021 Jan 2022 Mar 2022 Services Production Construction GDP Percentage points Contributions to Monthly GDP, UK Q1 2022 GDP vs pre-pandemic (Q4 2019) levels -1% 0% 1% 2% 3% Germany Italy United Kingdom France Canada United States
- 6. Business investment remainssubdued UK Gross fixed capital formation and business investment, chained volume (100= Q1 1997)
- 7. Goods imports higher,exports relatively flat UK good exports, excluding precious metals UK goods imports, excluding precious metals £0bn £5bn £10bn £15bn £20bn £25bn £30bn Mar-19 Sep-19 Mar-20 Sep-20 Mar-21 Sep-21 Mar-22 EU exit deadlines End of EU transition period Import data collection changes £0bn £5bn £10bn £15bn £20bn £25bn £30bn Mar-19 Sep-19 Mar-20 Sep-20 Mar-21 Sep-21 Mar-22 Coronavirus Pandemic EU Non-EU Export data collection changes End of EU transition period EU exit deadlines Source: ONS – UK Trade
- 8. Inflation remains wellabove historical averages Source: ONS – Producer prices, Consumer prices -2% -1% 0% 1% 2% 3% 4% 5% 6% 7% Jan- 06 Oct- 07 Jul-09 Apr- 11 Jan- 13 Oct- 14 Jul-16 Apr- 18 Jan- 20 Oct- 21 2nd Decile 9th Decile Source: ONS – Household costs indices -10% -5% 0% 5% 10% 15% 20% 2010 JAN 2012 JAN 2014 JAN 2016 JAN 2018 JAN 2020 JAN 2022 JAN CPI PPI (input) CPI experienced by high and low income households UK consumer and producer prices, annual change
- 9. Business and consumerresponses to inflation 0% 10% 20% 30% 40% 50% 60% Other Request change to mortgage Take up employment Borrow money Ask for help from family or… Ask for a pay increase in… Look for a higher-paid job Work longer hours Use existing savings Save less each month Household plans to fund cost of higher inflation Businesses passing price increases onto customers Source: ONS Business Insights & Conditions Survey Source: NMG Consulting, Bank of England survey 0% 10% 20% 30% 40% 50% 60% 70% 80% All Services Construction Production Early March 2022 Early April 2022 Late April 2022
- 10. Lower business turnover,consumer confidence -50 -40 -30 -20 -10 0 10 20 01/1985 01/1991 01/1997 01/2003 01/2009 01/2015 01/2021 Source: GfK Consumer confidence barometer UK confidence nearing 2020 pandemic lows Net change in business turnover expectations, April 2022 Source: ONS Business Insights & Conditions Survey -8% -6% -4% -2% 0% Production Construction Services All businesses
- 11. Earnings growth andindustry shortages Source: ONS Average weekly earnings, Job vacancies, Unemployed persons Note: Growth for combined industries is weighted according to AWE employment share A, B, D, E** Agri/Mining/Utilities C Manufacturing F Construction G Wholesale & Retail H Transport and Storage I Accommodation and Food J Info and comms K, L Finance and Real Estate M Pro Sci Tech N Admin and Support O Public Admin P Education Q Health R, S, T** Arts, Ent/Other [CELLRANGE] [CELLRANGE] [CELLRANGE] [CELLRANGE] [CELLRANGE] [CELLRANGE] [CELLRANGE] [CELLRANGE] [CELLRANGE] [CELLRANGE] [CELLRANGE] [CELLRANGE] [CELLRANGE] [CELLRANGE] -4% -2% 0% 2% 4% 6% 8% 10% 12% 0.0 0.2 0.4 0.6 0.8 1.0 1.2 1.4 1.6 Annual growth in average earnings, 3mma Number of unemployed people per vacancy by industry Stronger pay pressure Size = Employment share Shortages more likely
- 12. Summing up • AlthoughUK GDP rose 0.8% in Q1, monthly growth has slowed • More businesses are passing on higher costs to consumers, while households are planning to run down their savings • Other headwinds to growth include higher interest rates, weak consumer confidence and sluggish business investment • UK goods imports markedly higher, exports remain relatively flat, • Little sign to date a tight labour market is driving earnings higher
- 13. ONS Plans for SubnationalStatistics Deputy Director Subnational Statistics and Analysis Division Abbie Davies Lead Analyst Office for National Statistics Emma Hickman @ONSfocus #economicforum
- 14. Senior Subnational DataGroup Strategy and workplan
- 15. Senior Subnational DataGroup GSS Subnational Data Strategy (December 21) A framework to guide the GSS in producing and disseminating more timely, granular and harmonised subnational statistics, that meet user needs Referenced in the Levelling Up White Paper as a key enabler in the Government’s ambition to improve subnational data and improve transparency and accountability to the public
- 16. Senior Subnational DataGroup GSS Subnational Data Strategy ambitions Produce more timely, granular and harmonised subnational statistics Build capability and capacity for subnational statistics and analysis Improve the dissemination of subnational statistics Explore Subnational Statistics service
- 17. Senior Subnational DataGroup ONS Subnational Workplan ONS committed to follow up the Strategy with a workplan Published 16 May 2022 A cross-cutting overview of the wide range of new or improved subnational outputs and initiatives, planned for the next 18 months, across the Office A strong commitment for UK-wide coverage, where possible, enabled by solid collaboration with the Devolved Administrations
- 18. Senior Subnational DataGroup Examples of workstreams on ONS subnational workplan
- 19. Senior Subnational DataGroup Plans will be further developed over the next few months and will result in additional milestones Examples of workstreams on ONS subnational workplan
- 20.
- 21. Model-based early estimatesof regional GVA • Started publishing model-based quarterly estimates of regional GVA from October 2021 onwards • Early indication of quarterly GDP, published 5 months in advance
- 22. Productivity in townsand travel to work areas • Experimental labour productivity data for TTWAs and towns made available for the first time in December 2021 • Complements existing annual subregional productivity release
- 23. Disaggregating annual subnationalGVA to lower levels of geography • As part of the ONS strategy to provide more granular data to our users • Experimental statistics using granular geographies as building blocks to derive GVA for flexible geographies • Improve our understanding of the local economy • Provisional publication for second version Autumn 2022
- 24. Coherence • Not alllevelling up metrics and evidence base are available or coherently measured across the UK • Challenge to understand regional disparities across the UK • GSS Coherency programme will disseminate qualitative research findings into what UK wide data users need and where data gaps are • ONS will work with departments and DAs to prioritise and harmonise measure where relevant
- 25.
- 26. Explore Subnational Statistics •Announced in GSS subnational data strategy • One-stop-shop for subnational data and statistics • Standardised geographies and user-defined areas • Prototyped as Subnational indicators explorer – second iteration published in May 2022
- 27. LUDA • Cross Govtlevelling up data collaboration platform – develop suite of dashboards to support decision making across Govt • Space for shared analysis and output production • Stores all levelling up data, including ESS data. • Will allow Govt colleagues to respond rapidly to queries using available data Example of current LUDA environment Example of proposed visualisations
- 28. ONS Local • Commitmentoutlined in the white paper • A statistical advisory service for local leaders, with dedicated analysts based in hubs across the UK, ensuring they have access to data, statistics and analysis to support decision making • Small teams of analysts based in each region, with teams shadowing across regions to build resilience and a central coordination team to align priorities Senior Subnational Data Group
- 29. Service offer Senior SubnationalData Group Analytical Teams will provide resource to scope and support analytical projects to provide statistical insights that support decision making Strategic Using our unique position within central government to understand, identify, and align priorities for both local and central decision makers, alongside capturing user needs Data Connecting local users to key government datasets, whilst also looking for opportunities where local data can add value to central decision making Network Establishing local partnerships with a range of external stakeholders to bring together regional expertise, share knowledge, and draw on research capability
- 30. Provisional Milestones Summer/Autumn 2022:Regional roadshows to showcase offer and provide opportunity for feedback Winter 2022: ONS Local regional teams are established and working with partners to establish a longer-term workplan for each region Spring 2023: Regional workplans finalised and shared with relevant teams across gov/ONS Summer 2023: ONS Local teams fully operational with clear workplan. Summer roundtable hosted by ONS as opportunity to share progress and review/evaluate the service so far
- 31. Thank you forlistening
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- 34. Picture of theScottish Economy Sandy Stewart Office of the Chief Economic Adviser
- 35. CONTENT Office of theChief Economic Adviser • Picture of the Scottish Economy • Long term trends • Current State • Global challenges • COVID-19 • Brexit • Russia/Ukraine conflict • Inflation • Recent developments in Scottish National Accounts • Future developments
- 36. Long term trends– Scottish GDP – Jan 2007 – Feb 2022 Office of the Chief Economic Adviser 70 75 80 85 90 95 100 105 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 Notes: (1) Monthly estimates begin in 2010. Results for 2007-2009 are an illustrative path based on quarterly GDP. (2) Users are advised to be mindful that the axis on this chart does not start at zero.
- 37. Long term trends– Scottish and UK real GVA per capita – 1946-2021 Office of the Chief Economic Adviser
- 38. Long term trends– Scottish GVA by Section – 1946-2021 Office of the Chief Economic Adviser
- 39. Global Economic Context Officeof the Chief Economic Adviser • The global economy is continuing to recover from the economic shock of the pandemic. In 2021 global output grew 6.1%, rebounding robustly from the 3.1% fall in 2020, as economic activity strengthened with the easing of Covid restrictions. • In April the IMF projected that global growth would to slow to 3.6% in 2022 and 2023 (down 0.8 and 0.2 points respectively on the January forecast). • Global industrial production and trade in goods also continued to strengthen into February 2022, however the economic outlook has weakened significantly as a result of the situation in Ukraine and the significant sanctions imposed on the Russian economy.
- 40. Global Inflation andCommodity Indices Office of the Chief Economic Adviser • Global inflation rose sharply during 2021, reflecting rising energy prices alongside disruption in global supply chains as the economy rebalanced from the impacts of the pandemic. • The war in Ukraine has exacerbated these inflationary pressures reflecting the importance of Ukraine and Russia in the production and supply of a range of commodities particularly in energy (oil and gas), various agricultural products (notably wheat) and an array of precious metals. • The recent lockdowns in China to contain COVID outbreaks is expected to further exacerbate existing supply chain disruptions and inflationary pressures.
- 41. Scotland’s economy hascontinued to recover at the start of 2022 with output from consumer facing services growing as COVID restrictions have eased. Office of the Chief Economic Adviser • In February, Scottish output grew by 0.4% (UK: 0.0%) and GDP is now 1.3% above its pre-pandemic level in February 2020. • Growth in February was driven by the Services (+0.7%) and Production (+0.3%) sectors while Construction output fell (-0.1%). • Within the services sector, consumer facing services grew 2.1% in February, and is now 0.6% above pre-pandemic levels. Output in health, education, public services fell by 1.2%, while output in all other services grew by 1.3%. • Output in the production, construction and agriculture group fell by 0.4% during February, and is 2.1% below pre-pandemic levels. • More recent UK GDP data indicates that the UK economy contracted by 0.1% in March. Equivalent data for Scotland will be published on 1 June.
- 42. Business Trading Capacity Officeof the Chief Economic Adviser
- 43. Business Financial Performance Officeof the Chief Economic Adviser • When considering turnover in March 2022, relative to February 2022, 36% of all businesses reported that turnover had increased, 10% reported turnover had decreased and 46% reported that turnover had stayed the same. • Looking to the month ahead, 18% of all businesses expected turnover to increase in April, while 58% expect it to stay the same, 15% expected turnover to decrease. • Data for March showed that 53% of businesses reported that input prices increased more than normal, and 59% reported that input prices had increased compared to the previous month.
- 44. Google Mobility Office ofthe Chief Economic Adviser • Google Mobility data indicates that movement around retail and recreation hubs is continuing to recover from the sharp fall in January during the Omicron wave and holiday period. • Having fallen 30% below pre-pandemic levels in January, movement around retail and recreation hubs recovered to around 5% below pre-pandemic levels at 12 May. • Looking across the economy, visits to workplaces remain 20% below, transport 20% below and grocery and pharmacy 9% above pre-pandemic levels. • Visits to parks in Scotland have unsurprisingly been very seasonal with significant increases during the Summer. • The amount of time spent in residential settings remains above the baseline.
- 45. Trade Office of theChief Economic Adviser • Business survey data for April indicates trading conditions remain challenging for businesses. • 63% of Scottish businesses report to be exporting as normal for the time of year while the share reporting they are exporting less than normal has risen to 26%, up from around 20% at the start of the year. • This is likely to reflect ongoing supply chain disruptions which are expected to be exacerbated by the situation in Ukraine and the recent Covid lockdown restrictions in China. • In April, 41% of exporters and 50% of importers reported facing changes in transportation costs (down from 48% and 57% respectively in March) • 26% of exporters and 39% of importers reported facing challenges with custom duties and levies (down from 33 and 40% respectively in March).
- 46. How has Scotland’strade in goods with the EU been affected by the new UK-EU trading arrangement? Synthetic Control modelling. Office of the Chief Economic Adviser • Model estimates how Scottish trade in goods (excluding oil and gas) with the EU would have looked without EU Exit (on Jan 1st 2021), using a "synthetic control" – a weighted average of similar countries which closely track Scotland’s trade with the EU before the implementation of the Trade and Cooperation Agreement • The impact on imports was statistically significant for each quarter in 2021, resulting in 18% to 25% lower imports in 2021 than without EU Exit (£1.7 to £2.5 billion lower). • The impact on exports is only significant for the first quarter in 2021, resulting in 9% to 14% lower exports in Q1 2021 (£200 to £300 million lower).
- 47. Estimate of supplychain impact of lost exports to Russia using the Scottish Government Input – Output model. Office of the Chief Economic Adviser • Prior to 2022, Scotland exported around £300 million of goods/year to Russia. Estimated to support Scottish GDP by around £250 million or around 0.2%. • Around £170 million of the impact is the direct impact on output from reduced exports, with the remaining £80 million a result of the indirect impacts on supply chains and from reduced wages in the wider economy. • Impact is small overall but more pronounced in certain sectors. • Manufacturing of machinery and equipment and information services are two of the most affected industries in Scotland, although both see their output only fall by around 2%. • This loss in output is likely to have an adverse impact on employment, although it will be difficult to identify this directly due to the wide pressures that the labour market is currently facing. Overall, the analysis suggests that around 3,500 jobs were being supported by exports to Russia. This is a partial measure of the overall impact.
- 48. Inflation Office of theChief Economic Adviser • UK CPI inflation rose to 9.0% in April 2022, up from 7.0% in February and has risen to its highest rate in the historical constructed series which began in January 1989, presenting increased cost of living challenges. • Inflation rates have also continued to rise in the US (8.3%) and in the Eurozone (7.4%), in part reflecting rising global food and energy prices over the past year. • In April, UK consumer prices rose over the year across almost all goods and services monitored. • The CPI figure in April accounts for the Ofgem energy price cap uplift which resulted in 12- month inflation rates of 53.5% for electricity and 95.5% for gas, compared with rates of 19.2% and 28.3% respectively in the previous month.
- 49. Recent Developments inScottish National Accounts Office of the Chief Economic Adviser • Introduction of Monthly GDP system • Integration of Monthly GDP system into Quarterly GDP and QNAS systems • QNAS – 2021 Quarter 4 • Constrained to 1998-2018 Supply Use tables • Introduction of double deflation • Rebased to 2018=100
- 50. Recent Developments inScottish National Accounts – impact of double deflation Office of the Chief Economic Adviser • Large revisions at industry level, but similar to UK patterns • Overall impact – small increase in overall growth rate. • Scotland similar to UK overall • More consistent with UK estimates and methods
- 51. Future Developments inScottish National Accounts Office of the Chief Economic Adviser • Resume Labour Productivity estimates for Scotland • Research into Prices and data availability • Resume GNI estimates for Scotland • Streamlining of GDP systems and publications
- 52. Building a Suiteof Subnational Socioeconomic Indicators for the UK Sharada Nia Davidson, Kevin Connolly, Ciara Crummey, Niccolo Brazzelli, Mairi Spowage sharada.n.davidson@strath.ac.uk ONS Regional Economic Forum: Glasgow, 24th May 2022
- 53. ESCoE Projects onRegional Indicators • Framework for Interregional Trade Data Collection and Estimation – ESCoE Technical Report 2021. • A Framework for the Production of Supply and Use and Input Output Tables for the Four Nations – resubmitted to ESCoE in Spring 2022 for publication • Developing of a Suite of Subnational Socioeconomic Indicators for the UK - resubmitted to ESCoE in Spring 2022 for publication • Note: I will use the terms “subnational” and “regional” interchangeably through the presentation to refer to different spatial areas including: the four UK nations, the 12 ITL1 regions (formerly NUTS1) and smaller areas such as local authorities, constituencies and super output areas.
- 54. The Need forSubnational Indicators
- 55. Purpose of Sucha Suite 1. Identification of the overarching characteristics and dynamics of a given region 2. Identification of inequalities within and between different regions of the UK 3. Assessment of the relative needs of different regions crucial when allocating funding 4. Identification of the appropriate policy levers and reforms required to reduce inequalities 5. Evaluation of the efficacy of policies implemented and their impact on socioeconomic outcomes
- 56. Report Objectives andScope • Complements GSS subnational data strategy with similar target audience: producers and users of subnational statistics • Rather than focussing on categories of indicators (health, housing, education etc.), considers the challenges associated with building profiles of local areas across the four nations • Hundreds of indicators which could be considered…objective is not to pin down exactly which to include • Adopt a four nation perspective and provide a series of recommendations: 1. How Timely Should the Indicators Be? 2. Which Levels of Geographical Granularity Are Required? 3. Do the Indicators Need to be Comparable Across the Four Nations? 4. Which Indicators Should be Included in the Suite? 5. How Can Measurement Issues, Comparability Issues and Data Gaps be Minimised? 6. How Should the Data be Disseminated?
- 57. How Timely Shouldthe Indicators Be?
- 58. Indicator Timeliness • Recentacademic and policy literature emphasises need for high-frequency indicators • Partly driven by the UK’s withdrawal from the EU and pandemic • But timeliness of the indicators should be aligned with the purpose of the suite… • …And there is a trade-off between timeliness and granularity, given sample sizes required • When examining socioeconomic outcomes/structural issues, low frequency data is fit for purpose • Recommend baseline frequency of suite is annual – suitable for skills, education, health, poverty etc. • Subset of indicators should be available at quarterly or monthly frequency – cost of living, labour market, claimant count
- 59. Which Levels ofGeographical Granularity Are Required?
- 60. UK Geographies andUsers’ Needs • To examine socioeconomic statistics need to focus on small area geographies (< ITL3 formerly NUTS3) • Devolved administrations: support policymaking in their respective nation • Subnational indicators designed to reflect specificity of their nation and support devolved policymaking • Indicators designed to align with their unique administrative geographies • UK government departments including ONS: support policymaking across the UK • Greater emphasis is placed on the comparability of data across the four nations • Assess the relative needs of different areas of the UK - crucial for allocation of LUF and CRF • Loss of specificity • Reconciling these two different sets of needs is key
- 61. UK Geographies andUsers’ Needs
- 62. UK Geographies andUsers’ Needs • We recommend that the baseline granularity for the suite of indicators is at the Local Authority (LA) level for Scotland, Wales and England and at the Local Government District (LGD) level for Northern Ireland • Northern Irish case - we also recommend that issues around the construction of historical time series are investigated since in 2015 the LGDs were reduced from 26 to 11. • While LAs may provide a useful starting point, there can still be considerable variation in socioeconomic outcomes, for example, poverty and health all indicators should also be available at a lower geographical level which is still relevant within a devolved context “building block” approach may provide a way forward
- 63. Do the IndicatorsNeed to be Comparable Across the Four Nations?
- 64. Do Indicators Needto be Comparable? • Recommend suite includes a subset of indicators which are comparable across four nations. • The remaining indicators should be equivalent (i.e. attempt to capture the same characteristic) but not necessarily comparable. • Where an indicator is included for England, the same indicator should only be omitted for the devolved nations under exceptional circumstances. • Should be cautious in terms of terminology: may be drawn into labelling indicators which are comparable as “headline” indicators while noncomparable indicators are “supporting” indicators • However, in this case, “headline” indicators may not be the “best” or most representative of a specific characteristic
- 65. Which Indicators Shouldbe Included in the Suite?
- 66. Towards a SocioeconomicSuite We considered: • Key Economic Indicators • Labour Markets • Skills, Education and Social Mobility • Income and Poverty • Housing • Health • Demography and Rurality • Other Indicators
- 67. • Economic Activity •Small area GVA and productivity (GVA per job filled) estimates now produced by ONS • LSOA data used as building block to derive bigger geographical areas • Comparisons can still be tricky…LSOA and MSOA should not be directly compared; GVA per head inappropriate way to compare areas with high net in- or out-commuting • Inflation - area of ongoing development but sample sizes are a major barrier • Trade - very important from an economic perspective (see Davidson and Spowage, 2021) but less critical in a socioeconomic suite and not required at the same level of granularity • All other indicators considered from a socioeconomic perspective Key Economic Indicators
- 68. Labour Markets • Laboursupply • Employment, unemployment, economic inactivity, employment by occupation, payrolled employees • Labour Demand and Business demographics • Employee jobs by industry, job vacancies • Enterprises births/deaths, no. of active enterprises, enterprise survival rates, high growth enterprises, business count • Skills Mismatch, Shortage or Gaps • Overqualification, skills shortage vacancies, skills gap by occupation
- 69. Labour Markets –Future Development • Many labour market statistics are published at a local level and could be included directly into the suite • Some require further development • Skills mismatch, shortages or gaps - some data does exists but needs to adapted to be included in suite of indicators • Business Demography by Region and SIC - Current business demography indicators based on the IDBR, are published at either a regional or SIC 2007 level, but not both
- 70. Skills, Education andSocial Mobility • Each nation has its own distinct education policy and system obtaining education indicators that are comparable or even similar across the four nations is highly challenging • Skills: NVQ4+, No qualifications • Social Mobility Commission (2017) builds social mobility index for by considering the following: • Early years: Nursery quality, early years attainment • School: Primary school quality and attainment, secondary school quality and attainment • Youth: Positive destinations after KS4, average A level or equivalent points score, A-levels or equivalent by 19 • Levelling Up White Paper also emphasises the importance of capturing different stages of education • Important decision on whether to focus on the entire population or only children and youth from disadvantaged backgrounds
- 71. Education – FutureDevelopment • School inspection reports as well as other individual school level data provide a rich opportunity to develop detailed datasets on education in local areas • This will require considerable collaboration between the ONS and Devolved Administrations (DAs) • Augmenting this data with proxies of disadvantage will facilitate analysis of social mobility – traditionally free school meal eligibility has been used to do this but differences across the four nations would likely make comparisons infeasible
- 72. Income and Poverty •Key to ‘levelling up’ and social policy are indicators that reflect earnings, income, benefits and poverty • Annual Survey of Hours and Earnings: earnings data at low geographical level • HMRC Pay as you Earn Real Time Indicators: of high frequency data on employees and pay • Data on claimant count and spending on debit and credit cards captures short-term trends during crises • Income: Gross disposable household Income, Annual household income • Earnings: Average weekly earnings, Earning by place of residence/work and gender, pay • Out of work benefits: Claimants by demographic • Poverty: Absolute and relative child poverty, fuel poverty, food security, absolute and relative poverty of working-age adults and pensioners, percentage of households in poverty most uneven coverage in terms of regularity and granularity
- 73. Poverty – FutureDevelopment • Most poverty indicators at ITL1 level with child poverty most developed • Income-based measures of poverty for smaller geographical areas is problematic due to small size of family resource survey • Could be supplemented with other data such as the Households below average income (HBAI) statistics. Although this is not publicly available lower than ITL1 geography • Other poverty indicators needed: • In work poverty – Low pay and zero-hour contracts motivate the need for an indicator to determine how this impacts poverty • Fuel Poverty – data available for English constituencies but different definitions across nations of UK • Food security – recently introduced but higher granularity is needed as only available at ITL1 • Household type in poverty – Needed for targeted approach to combat poverty
- 74. Early Warning Indicators •UK has gone through major structural changes over the past years which have negatively impacted the economy • Some regions have seen larger effects than other • Advantageous to include early warning indicators linked to a region's preparedness for future events • Climate change risk – Foremost issue that will negatively impact the UK economy over the next generation. Extreme weather events more likely • Indicator would account for regions geography, topography, available emergency services, transports, among other factors • Future epidemic risk - Possibility of future pandemics and epidemics. Subnational suite should include indicator for preparedness and account for the different types of jobs in a region • Resilience – business demography, average earnings and income, labour market, skills
- 75. Composite Indicators • Inaddition to individual indicator, subnational suite could include composite indicators • Composite indicators • Composite indices of economic activity are regularly produced using dynamic factor models (DFMs). • DFMs summarise information from several variables into one index using data-based weights • DFMs could also be used to produce annual indices of economic activity, performance and prioritisation for small areas across the UK • Similarity index • Key component of any subnational suite of indicators would be to include a comparison index between areas • UK index of multiple deprivation
- 76. How Can MeasurementIssues, Comparability Issues and Data Gaps be Minimised?
- 77. Key Challenges inMeasurement • A range of household surveys across the four nations are used to collect economic data • For business surveys, businesses are sampled from the interdepartmental business register (IDBR). • Business data is collected from Great Britain or Northern Ireland Reporting Units (RUs). • Can apportion activity to Local Units (LUs) to obtain, say, “Welsh” exports using an indicator variable e.g. employment shares. • LUs may also have different industrial classification to RUs. • Could instead ask GB RUs to provide information on the activity of their English, Welsh and Scottish LUs as in Scotland’s Global Connections Survey and Wales’ Trade Survey for Wales. • Sample sizes are often a key barrier to producing subnational statistics
- 78. Key Challenges inComparability • When comparing data across the four nations a comparability challenges can arise from: • Different definitions of key concepts e.g. fuel poverty, rurality • Different policy focus e.g. early years attainment vs early years attainment among the disadvantaged • Devolution of specific policy areas leading to different systems e.g. education, housing, health • Different data collection strategies e.g. UK wide survey vs devolved surveys
- 79. Minimising Measurement Issues •Issues relating to apportionment warrant further investigation. In some cases: • May be advantageous to ask GB RUs to report on the activity of their regional LUs. • May also be advantageous to classify RU according to dominant activity across regional LUs. • Issues around sample sizes can be minimised if ONS and DAs collaboratively identify: • Areas in which a sample boost would be mutually beneficial • When surveys deployed by the ONS and DAs can be harmonised (or include a subset of harmonised questions) • Identify areas in which small area estimation methods can be used • Where definitions or the policy focus differs across the four nations, can break down characteristics and seek to capture constituent parts e.g. rather than using a proxy for rurality collect data on: (i) population density and (ii) transport connectivity
- 80. Minimising Key RegionalData Gaps 1. Consumer prices sample sizes pose a considerable challenge but a boost is planned for NI 2. Working-age adults and pensioners in poverty not produced for small areas, small area estimation? 3. Skills shortages and mismatch some statistics produced by the four nations but requires standardisation 4. Educational quality, attainment and positive destinations data is available at the individual school level but considerable collaboration required with the devolved administrations 5. Transport connectivity uneven coverage across the UK 6. Business demography by industry data available by region, a breakdown by region and industry would provide valuable information on labour demand Data used to capture different dimensions of indices of multiple deprivation across the four nations should also be explored.
- 81. How Should theData be Disseminated?
- 82. Dissemination • Majority ofsubnational statistics are published according to category (e.g. housing, health, labour market) rather than geographical area. • Exception is NOMIS which provides labour market statistics for area profiles and NINIS which provides NI neighbourhood data • We recommend that this service is publicised more widely and that extensions to the service are considered: • Statistics on small areas in NI. • Statistics on devolved constituencies. • Ultimately, NOMIS (or the explore subnational statistics service) could provide area profiles on a wide range of indicators. • Should consider how to guide users so that comparisons across areas are only made where appropriate.
- 83. Summary 1. How TimelyShould the Indicators Be? • Annual with a subset at a higher frequency 2. Which Levels of Geographical Granularity Are Required? • Local authority and local government district BUT this can mask considerable variation in large local authorities • Lower level geographies which are meaningful in a devolved context should also be considered 3. Which Indicators Should be Included in the Suite? • Economic, Labour Market, Education and Social Mobility, Income and Poverty, Housing, Health, Demography and Rurality 4. Do the Indicators Need to be Comparable Across the Four Nations? • A subset should be comparable with others equivalent • Exert caution when referring to comparable “headline” and remaining “supporting” indicators
- 84. Summary 5. How CanMeasurement Issues, Comparability Issues and Data Gaps be Minimised? • Issues around apportionment and disaggregation need to be considered • Identify areas in which the ONS and DAs can collaborate to boost and harmonise surveys • Capture constituent parts where definitions differ • Key data gaps: CPI; skills mismatch; education; poverty; transport connectivity; business demography 6. How Should the Data be Disseminated? • NOMIS illustrates the usefulness of local area profiles • Should guide users to make valid comparisons
- 85. Thank you forlistening Happy to take questions. We anticipate the full report will be published soon in the ESCoE Discussion Paper Series. Email - sharada.n.davidson@strath.ac.uk
- 86.
- 87. Deputy Chief Economist Officefor National Statistics Closing remarks Richard Heys @ONSfocus #economicforum
- 88. Forthcoming ONS economicanalysis 24 May 2022 – GDP and events in history: how the COVID-19 pandemic shocked the UK economy 26 May 2022 – Long-term international migration, provisional: year ending June 2021 27 May 2022 – Health benefits of recreation, natural capital, UK: 2022 30 May 2022 – Youth unemployment by socioeconomic background, UK: 2014 to 2021 31 May 2022 – Quarterly regional labour productivity, gross value added, hours and jobs 10 June 2022 – The cost of living, current and upcoming work: June 2022 All information on upcoming analysis can be found via the ONS website @ONSfocus #economicforum
- 89. ONS Consultations ONS openparticipation activities: Research and Development (R&D) survey The ONS run a suite of Research and Development (R&D) surveys. Each of these annual surveys are used to measure R&D activity in the UK. Outputs from each are combined with administrative data that measures R&D activity for the higher education sector to compile the ONS’ Gross Domestic Expenditure on R&D release. Headline statistics from this release are used to measure progress towards government set targets linked to R&D. We want to ensure that our data meets the needs of the people who use it. To achieve this, we are conducting a review of our applied methodology, exploring alternative data sources and reviewing our R&D questionnaires. Please support to this important work by responding here. The survey is live until 2 June 2022. @ONSfocus #economicforum
- 90. ONS User Survey ONSopen participation activities: Labour Market Statistics User Engagement The ONS is undertaking an ambitious transformation programme to improve labour market statistics through survey transformation and increased use of data from administrative and other sources. The main survey that provides labour market information from an individual and household perspective is the Labour Force Survey (LFS). With recent developments, including the addition of the ability to respond by telephone, the ONS is now in a position to begin moving towards incorporating the transformed LFS data into the regular labour market data releases. Please support to this important work by responding here. The survey is live until 29 June 2022 More information, including on how to respond, can be found on our consultation and stakeholder participation hub: https://consultations.ons.gov.uk @ONSfocus #economicforum
- 91. ONS Subnational Workplan Launched16 May in response to the GSS subnational data strategy New or improved subnational outputs and initiatives planned over the next 18 months Workstreams covering a wide range of themes, from the economy to population, migration and Census With a focus on UK-wide coverage, where possible, enabled by solid collaboration with the Devolved Administrations @ONSfocus #economicforum
- 92. Dates for yourdiary 25-27 May 2022 – ESCoE Conference on Economic Measurement – University of Strathclyde, Glasgow 15 June 2022 – Economic Data Science Seminar Series - Alexandre Judes 20 June 2022 – ONS Economic Forum Further details on the above events will be published at ons.gov.uk/economicevents @ONSfocus #economicforum
- 93. Thank you forattending the Economic Forum You can keep up to date on all up coming events via ons.gov.uk/economicevents If you would like to ask a question or provide any feedback, please do so via economic.engagement@ons.gov.uk
Editor's Notes
- #16 The GSS Subnational Data Strategy provides a framework to guide the GSS in producing and disseminating more timely, granular and harmonised subnational statistics. The Strategy sets out how we can achieve this aim by showcasing best practice and case studies, while signposting to existing GSS policies and guidance. The Strategy was launched in December at the Economic Forum. On the same day our division also published an article on the industry structure of towns and the first experimental GVA estimates at MSOA level. GSS subnational data strategy launched at ONS Economic Forum in December 2021 by Sam Beckett, alongside article on the industry structure of towns and first experimental GVA estimates at MSOA (and LSOA level through SRS) GSS subnational data strategy – GSS (civilservice.gov.uk) For the purposes of this strategy, ‘subnational’ refers to all data and statistics that are provided for the 12 International Territorial Level 1 (ITL1) areas in the UK, which include Northern Ireland, Scotland, Wales, and the nine English regions, and for lower-level geographies. [next slide]
- #17 The Strategy identifies three overarching ambitions which should guide us all when working with subnational statistics. The first ambition is to produce more timely, granular and harmonised subnational statistics, aiming for subnational by default. The second ambition focusses on building capability and capacity for subnational statistics and analysis by improving the way we share data, methods and expertise. The third ambition is to improve the dissemination of subnational statistics so that our users can draw insights from our outputs more efficiently. Together, these three ambitions set out a vision for the creation of a single service for the dissemination of subnational data and statistics organised by standardised geographies and able to accommodate flexible user-defined areas. We like to think of this as the Explore Subnational Statistics service. [next slide]
- #18 See content on slide but mention the sentence below if appropriate: The publication of this ONS subnational workplan will set a virtuous precedent and encourage other Departments to think about their own workplans through the Strategy’s ambitions lens.
- #27 Dissemination - Explore subnational statistics digital service 3*G7 + 3*SEO product development team This would give protected digital publishing resources to develop a specific product for local users that brings together all the relevant data in a single place that is easy to navigate and visualise. ONS has developed significant expertise in developing innovative storytelling products (such as scrollytelling and the subnational indicators explorer). We would be willing to share relevant code and templates with DLUHC as we have done for the median absolute deviation method used in the subnational indicators explorer to support wider capability building across government.
- #29 Following the commitment we made in the white paper to work with Levelling Up directors to support local decision-making, we are also looking to establish a new regional offer as part of package 1. Note that we have been referring to this internally as ONS Local however we’re planning to adjust this branding based on feedback we’ve had so far. As part of this offer we will be setting up regional hubs across England and we are working with colleagues on the call today from Scotland, Wales, and Northern Ireland to understand how we can best support existing structures in the DAs. Each regional hub will be made up of a small team of analysts, and we will build from lessons learnt in the previous regional statistician model, surrounding resilience, by having regional teams shadow each other across the North, Midlands, and South. At the centre of this structure we will establish a coordination function who will work to align priorities across the regional hubs, whilst ensuring the service remains linked up with other teams across ONS and other government departments.
- #30 The service offer itself has 4 strands, and will build on work that my team currently leads on with the English Mayoral Combined Authorities. The first part of our offer is analytical – so working with regional analysts to scope and support projects that will provide statistical insights, and seeking to understand where our analytical support can really have impact. From a strategic perspective, we will use our position within central government to connect local and central decision makers, ensuring that analytical requirements are shared in both directions. On data, we will pursue a two way relationship where local government are supported in accessing the central government datasets they need, whilst also understanding where local data be used centrally. And finally on network – we want to establish local partnerships across a range of external stakeholders to share experience, knowledge, and research capability.
- #100 Link to the ONS subnational workplan article: https://www.ons.gov.uk/economy/regionalaccounts/grossdisposablehouseholdincome/articles/subnationalstatisticsandanalysiscurrentandupcomingworkmay2022/2022-05-16