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| I. Analytical Framework, Concepts, Definitions, and Classifications |
2.1.1 Concepts and definitions Statistical concept The Industrial Production Index is a business cycle indicator showing the output and activity of industry. It measures changes in the volume of output at close and regular intervals. Definition of indicators The Industrial Production Index provides a measure of the volume trend in value added at basic prices over a given reference period. Value added at factor cost can be calculated from turnover (excluding VAT and other similar deductible taxes directly linked to turnover), plus capitalised production, plus other operating income plus or minus the changes in stocks, minus the purchases of goods and services, minus other taxes on products which are linked to turnover but not deductible, minus the duties and taxes linked to production. The data necessary for the compilation of such an index are, however, not available on a monthly basis. In practice, suitable proxy values for the continuation of the indices are:
2.3.1 Classification/sectorization NACE Rev.1.1 (Statistical classification of economic activities in the European Community, Eurostat, 2002) is used for classification of the activities. |
| II. Scope of the data |
2.2.1 Scope Scope of the data Geographical coverage Data are published for the euro-area, the European Union (EU-15 and EU-25) and for each country separately, if data are available. Statistical units The observation unit is the kind-of activity-unit (KAU). The KAU groups all the parts of an enterprise contributing to the performance of an activity at class level (four digits) of NACE Rev.1.1. Statistical population According to the Short Term Statistics regulation (Council Regulation N° 1165/98 of 19 May 1998 ) (hereafter referred to as the STS-R), all Member States are obliged to transmit data for Mining and quarrying (Section C), Manufacturing (Section D), and Electricity, gas and water supply (Section E) of NACE Rev. 1.1, except Division 41 (Collection, purification and distribution of water) and Group 40.3 (Steam and hot water supply). The data should be transmitted at the 2-digit level. Data for Section D should also be transmitted at 3-digit and 4-digit level by those Member States that have a total value added of Section D (Manufacturing) NACE Rev. 1.1 that represents more than 4% of the European Union total. Data at 3-digit and 4-digit levels that are not requested may also be transmitted for individual countries, if they are considered to be of sufficient quality. |
| III. Accounting Conventions |
| IV. Nature of the Basic Data Sources |
3.1.1 Source data collection programs Member States are encouraged to transmit seasonally adjusted data and trend-cycle indices. If they do not, Eurostat calculates the seasonal adjustment using the methods TRAMO (Time Series Regression with ARIMA Noise, Missing Observations, and Outliers) and SEATS (Signal Extraction in ARIMA Time Series), hereafter referred as TRAMO/SEATS. However, if available, nationally adjusted data are published. To know more about TRAMO/SEATS, or to freely download it from the internet, contact http://www.bde.es/servicio/software/econome.htm. National Statistical Institutes are responsible for data collection and calculation of national indices, in accordance with EC Regulations. Eurostat is responsible for EMU and EU aggregations. Data collection is carried out by Member States. Mainly statistical questionnaires are used for compiling the Industrial Production Index. The STS-R requires this indicator to be transmitted to Eurostat as an index. 3.1.2 Source data definitions, scope, classifications, valuation, and time of recording Type of survey The most accurate production information on products is generally obtained from specialised surveys on output. In the EU Member States the Prodcom survey is carried out annually. The Prodcom list describes between 5,000 and 6,000 products and/or product categories assigned to NACE Rev. 1.1 Sections C, D and E. To calculate an IPI, however, sub-annual and preferably monthly production information is required. For this reason, the best theoretical basis for an IPI is a representative monthly production survey. Production statistics ascertain the quantity and/or value of goods and their related industrial services. These products are assigned to branches at an appropriate level of NACE Rev. 1.1, in practice at the 4-digit level. As the aim is to show in a representative manner the short-term development of individual branches and of industry as a whole it is not necessary to include all products and/or all observation units. Rather, a selection of products and/or units can take place. The quality of the selection can be verified on the basis of a comprehensive production survey which takes place at least once a year. It must also be ensured that the selection does not become too outdated and that actual structural changes and technical progress are reflected in the IPI. Techniques of data collection Detailed methodological information about Member States practice is available online. 3.1.3 Source data timeliness Data should be transmitted to Eurostat no later than 1 month and 15 days after the end of the reference period. This deadline may be extended by 15 more calendar days for those Member States whose value added in Sections C, D and E of NACE Rev. 1.1 in a given base year represents less than 3% of the European Community total. Also, the deadline may be up to 15 calendar days longer on the NACE group and class levels. |
| V. Compilation Practices |
3.3.2 Other statistical procedures Base period Indices in STS are expressed with reference to a base value and this base value is representative for a base year. For a monthly series the base value is the monthly average during the base year and for a quarterly series the base value is the quarterly average during the base year. By convention the index value of 100 is assigned to the base value. General criteria for suitable base years are that they should be a "normal" or "average" year, which has not shown very strong special influences. However, so that international data comparison and aggregation of national indices are not made more difficult through different nationally specified base years, the STS-R has specified that base years should be updated every 5 years and that the base years should be those ending in a "0" or a "5". The STS-R requires that rebasing should take place within three years from the end of the base year. The current base year is 2000. As for the growth rates, note that month on month (t/t-1) changes are calculated using seasonally adjusted data whereas year on year rates (t/t-12) use working day adjusted data. Compilation of European aggregates For the calculation of the seasonally-adjusted euro-area, the EU-15 and EU-25 aggregates, Eurostat applies the so-called direct method. Working day adjusted data from Member States are used to calculate a weighted mean in order to compile a working day adjusted euro-area, EU-15 and EU-25 series. Missing components are estimated with autoregressive integrated moving average models, hereafter referred as ARIMA models. Seasonally adjusted euro-area, EU-15 and EU-25 series are then produced using TRAMO/SEATS. More information on ARIMA models and TRAMO/SEATS methods can be found at http://www.bde.es/servicio/software/econome.htm). The weight for aggregating this index between Weights are revised every five years and the current base year is 2000. Methodological information on the weights, as well as shares of the non-confidential weights can be found here . The European aggregation is successive, meaning that the starting date of the aggregate equals the point when data is available for sufficient countries such that a 60% threshold of the total weight is reached. No backcasting of the national series is performed; therefore the final European aggregate is a compilation based on data for a number of countries that increases with time. To avoid potential level shifts in the aggregate each time a new national series is included in the aggregate, the level shifts are corrected. The correction influences the level of the aggregate but respects the growth rate of the corrected segment. Following the corrections of the level shifts, the base year values may have been altered. This is only the case if a level shift was treated after 2000. Therefore, subsequently the whole series will be rescaled, in order to average 100 in the base year. Adjustments Member States are required to transmit working day adjusted series. Member States are encouraged to transmit seasonally adjusted data and trend-cycle indices. If they do not, Eurostat calculates the seasonally adjusted and trend cycle indices using TRAMO/SEATS. However, if available, nationally adjusted data are published. Treatment of missing values: ARIMA. 3.4.1 Validation of intermediate results Data validation of statistical data Data received from Member States and EU data are validated using logical validation rules and the quality of data is regularly checked. |
| VI. Other Aspects |
| Footnotes | ||
| Last posted: Date IMF staff last posted an update to these metadata on the DSBB. | ||
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| Last updated: Date subscriber last submitted an update of these metadata to the IMF. | ||
