The Scottish Government

This item was published during the term of a previous administration that ended in April 2007

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Estimates show rise in GDP

07/05/2003

Gross Domestic Product in Scotland rose by 0.7 per cent in the fourth quarter of 2002, according to provisional estimates released today. There was no change in the level of GDP in 2002 compared to 2001.

The main findings of the latest figures are:

• GDP (seasonally adjusted) rose by 0.7 per cent in 2002 Q4. Over the same period, GDP for the UK as a whole rose by 0.3 per cent.

• There was no change in the level of GDP in Scotland over 2002, compared with 2001. The equivalent annual growth for the UK was 1.3 per cent.

• Compared with 2001, annual output in the Scottish service sector grew by 4.2 per cent in 2002, compared with a 9.9 per cent drop in the production sector and a 2.9 per cent drop in construction. The equivalent figures for the UK were +2.7 per cent (services), -3.5 per cent (production) and +7.5 per cent (construction).

• Output in the manufacturing sector decreased by 1.6 per cent in 2002 Q4, and by 11.9 per cent in the 4 quarters to 2002 Q4. The equivalent figures for the UK were drops of 1.0 per cent and 4.0 per cent respectively.

The full Statistical Publication Notice for GDP for the 4th quarter of 2002 is available at www.scotland.gov.uk/stats/bulletins/00256-00.asp

NEXT PUBLISHED (Provisionally): 30 July 2003

Gross Domestic Product (GDP) is a measure of the value of goods and services produced by residents, before allowing for depreciation or capital consumption. Net receipts from interest, profits and dividends abroad are excluded.

These quarterly Scottish output-based estimates of GDP are based on much improved sources. In particular, whereas previous (annual) estimates of service sector activity relied heavily on UK indices adjusted by Scotland's relative employment share, the series are now derived directly from survey returns from businesses with bases in Scotland.

The GDP estimate is calculated by producing a weighted average of over 260 separate indices (163 of which are in the production sector). The indices represent changes in the value added, at constant prices, in the production of goods and services in individual industries. These industries are compiled using the standard industrial classification SIC92. The weights used are proportional to the contribution of each industry or service to GDP in the base year (1995). Within production, weights are derived, for the most part, from the value added to output as measured by the Annual Census of Production in the base year. Where value added figures are not available, proxy indicators are used. Over time, the movement of these proxy indicators may relate less closely to changes in value added due to efficiency and price changes.

Series are derived from indicators based on data from a wide range of sources. Examples include: deflated turnover, deflated production, the amount of a good or service sold or produced and, for some parts of the public sector, employee numbers.

The indices published within this Statistics Publication Notice are grouped according to the 1992 revised Standard Industrial Classification. The four broad groupings of industries are

(a) agriculture, hunting, forestry and fishing

(b) production which comprises: mining and quarrying industries; energy and water supply; and manufacturing, which includes: refined petroleum products and nuclear fuel; chemical and man-made fibres; metal and metal products; engineering and allied industries; food, drink and tobacco industries; textiles, footwear, leather and clothing; other manufacturing.

(c) construction

(d) services, which includes: retail and wholesale; hotels and catering; transport, storage and communication; financial services; real estate and business services; public administration, education and health; other services.

The methodology employed to calculate the Scottish estimates of GDP growth is consistent with that used by other National Statistics publications in the calculation of Gross Value Added (GVA) for the UK and, as such, is ESA95 (European System of Accounts 1995) compliant. An article "Quarterly estimation of Gross Domestic Product" appeared in Scottish Economic Statistics, published by the Scottish Executive in February 2000.

Scottish GDP estimates will generally be less reliable than the estimates for the UK, primarily because the equivalent UK figures are produced by balancing 3 independent sets of estimates (Output (GVA), Income & Expenditure-based approaches). Furthermore, the survey data tend to be based on smaller numbers of units, making figures for Scotland more likely to be subject to small random fluctuations.

The revised gross value added (GVA) statistics for Scotland, which were released on Thursday 21st November 2002 by the Office for National Statistics have been withdrawn and deferred until the data problems are resolved. The ONS estimates are methodologically different from the Scottish Executive estimates and are based on different data sources. The two datasets are intended to be used for different purposes. The Scottish Executive estimates are unaffected by difficulties with the ONS estimates.

The figures in the full Statistics Publication Notice, available at www.scotland.gov.uk/stats/bulletins/00256-00.asp incorporate revisions due to new and revised data, and the updating of seasonal adjustment factors. The data suppliers have verified these changes. These are one off revisions. Tables 8 to 12 show details of all revisions.

This full Statistics Publication Notice contains detailed service sector series (Table 4). The sectors covered are Retail, Transport, Communication and Banking. The Scottish Executive plans to continue to publish these data as experimental data for the next year or so, reviewing their quality and relevance with users.

National Statistics are produced to high professional standards set out in the National Statistics Code of Practice. They undergo regular quality assurance reviews to ensure that they meet customer needs. They are produced free from any political interference.

Issued by

Office of the Chief Economic Adviser

Finance and Central Services Department

St Andrews House

Regent Road

Edinburgh WH1 3DG