Annual Industry Accounts Overview
George Smith & Nicole MayerhauserCurrent Industry Analysis DivisionBureau of Economic Analysis
Industry Accounts Users’ Conference, October 26, 2007
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Annual Industry Accounts
“Integrated” Annual I-O and GDP by Industry 12 months after year (2006 in Dec 2007)
2005 and 2004 revised 65 industries
“Advance” GDP by Industry 4 months after year (2006 in April 2007) 22 industry groups
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Outline
Uses and products Methods and strengths Challenges and progress What’s ahead Q & A
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Integrated - Uses
Link industry-sector-macro performance
Relative size; relative growth; contribution to growth
Analyze specific industriesKLEMS and productivity analysis
Input to other BEA programsTTSA; GDP by State; Regional I-O
Model
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Integrated - Products
Annual time series, 1998-forward Make and use tables Supplementary tables
Direct & total requirements Bridge (PCE, Private investment) Import matrices
Quantity and price decompositionHistorical NAICS estimates, 1947-97
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Integrated – Strengths
Improved consistency I-O framework perspective
Current-dollar: cross-section & time series Quantity and price: time series
Mix of inputs used by industries overall (Step 1)
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Mix of inputs overall (Step 1)
INDUSTRY USES FINAL USES
Agriculture MiningConstructi
onManufactu
ringTransporta
tionTrade
Finance
Services
Other Total PCE PFI CBI X M GOV GDPTotal
Commodity Output
Agriculture
Minerals
Construction
Manufacturing
Transportation
Trade
Finance
Services
Other
Noncomp imports
Total interm inputs
Comp
ValueTaxes on prod & imports, less
AddedGross op surplus
Total
Output
Commodities
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Integrated – Challenges & progress
Mix of inputs, by industry (Step 2) BEA/Census “core expense” initiative
Input categories (e.g., purchased professional and technical services)
Services Annual Survey, beg. 2005 Annual Survey of Manufacturers, beg.
2006
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Mix of inputs, ASM & SAS (Step 2) INDUSTRY USES FINAL USES
Agriculture MiningConstructi
onManufactu
ringTrade
Services (SAS)
Services (Other)
Total PCE PFI CBI X M GOV GDPTotal
Commodity Output
Agriculture
Minerals
Construction
Manufacturing
Transportation
Trade
Finance
Services
Other
Noncomp imports
Total interm inputs
Comp
ValueTaxes on prod & imports, less
AddedGross op surplus
Total
Output
Commodities
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Integrated – Challenges & progress
Mix of inputs, every industry (step 3) Survey coverage of services industries
Private services-producing 68% of GDP Wholesale & retail trade 13% Covered by SAS 30% Not covered by SAS 25%
Budget-contingent 2008 SAS coverage 55%
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Mix of inputs, long run (Step 3)
INDUSTRY USES FINAL USES
Agriculture MiningConstructi
onManufactu
ringTrade
Services (SAS)
Services (Other)
Total PCE PFI CBI X M GOV GDPTotal
Commodity Output
Agriculture
Minerals
Construction
Manufacturing
Transportation
Trade
Finance
Services
Other
Noncomp imports
Total interm inputs
Comp
ValueTaxes on prod & imports, less
AddedGross op surplus
Total
Output
Commodities
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Integrated – Challenges & progress
Quantity and price decomposition
PPI services coverage expansion Retail trade margin output Wholesale trade margin output Budget-contingent
Professional health care servicesComputer-related services
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Integrated – Challenges & progress
Source data inconsistencies Census output, BLS wages, etc. Separate business registers Different industry assignments of
units Data sharing restrictions Micro-data research of payroll
differences
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Integrated – Publication level
Analytical needs Value added
Publication and estimation levels
Work underway
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Integrated – What’s ahead
Comprehensive revision Revised 2002 benchmark I-O (2002
NAICS) Comprehensive NIPA revision due 2009 Census survey data on industry inputs Improved deflation of retail trade output Publish more industries if possible Imported service inputs by type
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Integrated – More information
Featured estimates and articles: www.bea.gov/industry/
index.htm#annual Underlying estimates:
www.bea.gov/industry/more.htm Information guide:
www.bea.gov/industry/iedguide.htm#GPO
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Advance GDP by Industry
Earliest look at most recent year
22 NAICS industry groups Current dollars Chained (2000)dollars Chained-type quantity indexes Chained-type price indexes
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8 months earlier than integrated accounts
Less detailed but good indicator of Direction of change Rate of change
(acceleration/deceleration) Industry growth relative to overall GDP
Advance - Uses
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Advance - Uses
Integration within BEA
NIPA current quarterly GDP/National Income
Advance GDP by Industry
Advance GDP by State
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Advance - Current dollar method
Value Added
Advanced estimates Extrapolated by industry Controlled to NIPA GDP
Output – Intermediate Inputs
Compensation
Taxes – Subsidies
Gross Operating Surplus
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Advance - Real estimates
Single deflation Value added deflated with output prices
Output prices NIPA price indexes BLS price indexes Nominal and volume output measures
from government and private sources
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Advance - Limitations
Single deflation
Assumptionoutput and input prices grow at same rate
Misstates real VA growth when output prices and input prices do not
move in the same direction or at the same rate of change
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Advance - Modified single deflation
Output vs input prices
Adjustments to real value added made when known prices differences exist
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Advance - What’s ahead
Double deflation Separate deflation for output and for
intermediate inputs
Real Value Added = real Output – real Intermediate Inputs
Requires few assumptions about the relationship between output and intermediate inputs.
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Advance - What’s ahead
Opportunity to compare 2 years: Single-deflation advanced estimates Double-deflated prototype estimates Integrated annual estimates
Assess size of revisions Single-deflation vs double-deflation
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Advance - More information
Press Release http://www.bea.gov/newsreleases/
industry/gdpindustry/gdpindnewsrelease.htm
Survey of Current Business http://www.bea.gov/scb/index.htm