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Gross Domestic Product for Scotland for the 2nd Quarter of 2004

DescriptionGross Domestic Product for Scotland for the 2nd Quarter of 2004
ISBN
Official Print Publication Date
Website Publication DateOctober 27, 2004

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Statistics Publication Notice Economy Series
GROSS DOMESTIC PRODUCT FOR SCOTLAND FOR THE 2ND QUARTER OF 2004

27 th October 2004

A Scottish Executive National Statistics Publication

This document is also available in pdf format (872k)

Gross Domestic Product in Scotland rose by 1.8 per cent over the year to 2004 Q2 and by 0.9 per cent in the second quarter of 2004 according to provisional estimates released today by the Scottish Executive.

The main findings of the latest figures are:

  • GDP rose by 1.8 per cent over the year to 2004 Q2 and by 0.9 per cent in the second quarter of 2004 (seasonally adjusted).
  • Over the year to 2004 quarter 2, annual output in the Scottish service sector grew by 2.0 per cent, compared with a 0.7 per cent drop in the production sector and a 9.3 per cent rise in construction.
  • In the second quarter of 2004, the service sector grew by 1.2 per cent, the production sector by 0.4 per cent and the construction sector by 0.1 per cent.
  • The service sector was the main driver of growth in the latest quarter. Over the year, the service and construction sectors were the main sources of growth.
  • UK Figures:
  • The UK figures show that GDP rose by 2.8 per cent over the year to 2004 Q2 and by 0.9 per cent over the latest quarter.
  • In the year to 2004 quarter 2, the UK experienced a 3.2 per cent growth in services, a 0.4 per cent growth in production and 6.3 per cent growth in construction.
  • Industry Analysis:
  • Output in the manufacturing sector continued to grow for the third consecutive quarter, increasing by 0.4 per cent in 2004 Q2. Over the year, the sector still shows a decline of 0.3 per cent.
  • Within manufacturing, the main sectors driving the quarterly increase were metal & metal products (3.8% over the quarter), refined petroluem products & nuclear fuel (4.5% over the quarter) and engineering & allied industries (0.4% over the quarter).
  • Over the latest quarter, the service sector grew by 1.2 per cent. Within this sector the main industries driving the quarterly increase were retail & wholesale (2.8% over the quarter), real estate & business services (1.3% over the quarter) and financial services (3.8% over the quarter).

NEXT PUBLISHED (Provisionally): 26 th January 2004

Table 1: Gross Value Added chained volume measures at basic prices,1,2 by category of output

Scotland, 1998 to 2004 Q2

2001=100

Total Gross Value Added

Agriculture, Forestry & Fishing

Production

Construction

Services

2001 weights3

1000

16

223

63

697

1998

94.1

97.7

101.3

92.9

91.9

1999

96.1

99.8

104.1

93.8

93.6

2000

98.1

101.3

104.7

102.1

95.7

2001

100.0

100.0

100.0

100.0

100.0

2002

101.0

102.9

93.2

94.6

104.0

2003

103.0

106.0

92.2

99.4

106.7

Seasonally Adjusted

1998

Q1

93.7

97.3

102.0

91.8

91.1

Q2

94.1

97.1

101.2

92.2

92.0

Q3

94.0

98.5

100.0

93.8

92.1

Q4

94.6

97.9

102.0

93.6

92.3

1999

Q1

95.3

98.1

102.8

90.6

93.3

Q2

95.2

100.1

102.5

92.0

93.1

Q3

96.3

100.8

104.7

94.2

93.7

Q4

97.4

100.2

106.4

98.4

94.4

2000

Q1

97.5

101.7

105.1

104.7

94.4

Q2

98.0

101.8

105.7

101.0

95.2

Q3

98.3

101.2

104.7

100.3

96.1

Q4

98.8

100.6

103.3

102.4

97.0

2001

Q1

99.4

99.5

102.3

104.2

98.1

Q2

100.0

99.4

102.0

101.9

99.2

Q3

100.1

100.0

98.8

97.6

100.8

Q4

100.5

101.1

96.8

96.4

102.0

2002

Q1

100.2

101.0

93.1

95.4

102.9

Q2

100.3

101.9

93.7

93.5

103.1

Q3

101.6

103.2

93.5

94.5

104.8

Q4

101.7

105.7

92.5

94.9

105.2

2003

Q1

102.1

104.8

93.1

94.1

105.7

Q2

102.9

106.1

91.8

98.6

106.8

Q3

103.3

106.9

91.3

101.9

107.1

Q4

103.7

106.4

92.6

103.0

107.3

2004

Q1

104.0

107.0

92.0

106.3

107.5

Q2

104.9

107.1

92.3

106.4

108.8

Percentage change:

Q2 03 on Q1 03

+0.8

+1.3

-1.4

+4.7

+1.0

Q3 03 on Q2 03

+0.4

+0.8

-0.5

+3.4

+0.3

Q4 03 on Q3 03

+0.4

-0.5

+1.4

+1.0

+0.1

Q1 04 on Q4 03

+0.2

+0.5

-0.7

+3.3

+0.2

Q2 04 on Q1 04

+0.9

+0.1

+0.4

+0.1

+1.2

% change latest 4 qtrs on previous 4 qtrs

+1.8

+1.8

-0.7

+9.3

+2.0

1. Gross Value Added (GVA) is also referred to as Gross Domestic Product (GDP) at basic prices
2. Estimates cannot be regarded as accurate to the last digit shown
3. Weights may not sum to the total due to rounding

BACKGROUND NOTES

Definitions

1. 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. The estimates produced in this publication measure GDP at basic prices (also referred to as gross value added (GVA)).

Methodology

2. In February 2004, on publication of results for 2003 Q3, the Scottish GDP estimates moved to annually weighted and chained estimates of volume measures - referred to as "annual chainlinking" - as recommended in the System of National Accounts 1993. This is consistent with the UK where this approach was introduced on 30 September 2003 in respect of the 2003 Q2 results. Annual chainlinking is achieved by producing a weighted average of over 260 separate indices (160 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 SIC2003.

3. The main difference between chainlinking and the previous "fixed base" methodology is that the weights applied to each industry (reflecting importance in the Scottish economy) are updated on an annual basis, instead of a 5-yearly basis. The major effect of chainlinking has been to more accurately reflect the changing importance of sectors. The impact of chainlinking the Scottish GDP series to 2000 weights was to reduce the negative effect of the low/declining growth in some sectors, while simultaneously increasing the importance of those which had been performing well. Both of these changes had a positive effect on the overall level of growth estimated by the Scottish GDP series. The weights have now been updated to 2001 in line with the annual chainlinking methodology. The effects of the new weights on the overall GDP index are negligible. There is a slightly positive effect on production and construction balanced by a very small negative effect on services with the result of almost no change to total GDP. A more detailed analysis of revisions is available on the Scottish GDP website www.scotland.gov.uk/gdp. In addition an article providing more information about the chainlinking methodology was published in Scottish Economic Statistics earlier this month www.scotland.gov.uk/stats/ses.

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

5. The quarterly Scottish GDP estimates are published within 4 months (approximately 17 weeks) of the end of the quarter to which it relates.

6. The indices published within this Statistics Publication Notice are grouped according to the 2003 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.

7. 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.

Cash Estimates of GVA

8. Estimates of the cash value of gross value added (GVA) at current prices for Scotland (and other regions of the UK) are produced by the Office for National Statistics. Estimates for 2002 were published on 30 th April 2004. The ONS current price value estimates are methodologically different from the Scottish Executive volume (constant price) index and are based on different data sources.

Revisions

9. The figures in this Statistics Publication Notice incorporate revisions to previously published estimates. The degree of revision this quarter is higher than usual due to the updating of industry weights to 2001 and from a number of improvements to methodology and input data. Tables 8 - 13 identify the extent of revisions since the last publication in July 2004.

The series most affected by revisions this quarter are:

  • Retail & Wholesale and Hotels & Catering - due to changes in deflators;
  • Chemicals - due to the change in weights;
  • Textiles - due to updated company level information;
  • E&IE - due to changes in the smoothing methodology for some indices;
  • Construction - due to changes in the smoothing methodology;
  • Transport, Storage and Communication -due to changes in deflators and revised data.
  • Real Estate and Business Services - due to new and revised data sources .
  • Other Services - due to a changes in deflators and revised data.

A number of other series are affected by revisions to a lesser extent. These are mainly due to revisions to input data and adjustments to seasonal factors. A more detailed analysis of revisions this quarter is available on the Scottish Executive GDP website www.scotland.gov.uk/gdp.

National Statistics

10. 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.

11. Detailed results for all industries are available to download from the Scottish Executive website www.scotland.gov.uk/gdp.

Issued by

Office of the Chief Economic Adviser
Office of the Permanent Secretary
St Andrew's House
Regent Road
Edinburgh EH1 3DG
Telephone
Press Office:
Pauline Davidson
0131-244-2547
Statistician:
Julie Ramsay
0131-244-3771

Tables

Table 1: Gross Value Added chained volume measures at basic prices,1,2 by category of output
Table 2: Gross Value Added chained volume measures at basic prices,1,2 by category of output
Table 3: Gross Value Added chained volume measures at basic prices: 1,2 service industries
Table 4: Gross Value Added chained volume measures at basic prices:1,2 detailed service industries
Table 5: Gross Value Added chained volume measures at basic prices:1,2 production industries
Table 6: Gross Value Added chained volume measures at basic prices:1,2 detailed production industries
Table 7: Gross Value Added chained volume measures at basic prices1,2 by category of output
Table 8: Revisions to data published on 28 July 2004 (Table 2)
Table 9: Revisions to data published on 28 July 2004 (Table 3)
Table 10: Revisions to data published on 28 July (Table 4)
Table 11: Revisions to data published on 28 July 2004 (Table 5)
Table 12: Revisions to data published on 28 July 2004 (Table 6)
Table 13: Revisions to data published on 28 July 2004 (Table 7)