OECD WP National Accounts

1
ISIC Revision 4 Top-top and Intermediate
Aggregation Structures (for SNA data reporting
by activity) OECD proposals

• William Cave
• OECD Statistics Directorate

2
What is ISIC?

• International Standard Industrial Classification
  of All Economic Activities (ISIC)
• The official activity classification of SNA
• To classify economic entities (units) according
  to activity they carry out
• Original ISIC 1948
• Rev 1 1958, Rev 2 1968, Rev 3 1989
• Minor Revision 3.1 2002,
• Major Revision 4 planned for 2007

3
Design principles priorities for ISIC rev 4

• Improve international comparability
• convergence of regional classifications
• E.g. NAICS,NACE,JSIC,CSIC,ANZSIC etc
• engage more countries regions in ISIC design
• target for international comparability at least 2
  digit level
• Relevance
• Information sector, internet , telecoms
• OECD ICT definition
• environmental services
• new technologies
• growing business service sector
• health services
• tourism
• agriculture
• Continuity long time series
• Level of detail for an international
  classification?

4
ISIC 3 and ISIC 4 top-level
5
ISIC rev 4 A Top-top Structure? What are SNA
needs?

• SNA AEG, OECD and Eurostat national accountants
  have agreed need for top-top structure to ISIC
  rev 4 of about 10 categories
• OECD national accountants proposed that
  intermediate aggregation of 30-40 categories
  useful for international comparison within OECD.
  SNA AEG in Dec 2004 were undecided.
• Currently OECD and Eurostat use A6/A17/A31/A60
  aggregations of ISIC rev 3 in national accounts
  questionnaires

6
Proposed set of ISIC 4 SNA data aggregations?

• A10/11 top-top
• A21 ISIC rev 4 Sections
• A38 ISIC rev 4 Sections 17 sub-sections
  (intermediate)
• A88 ISIC two digit divisions

7
OECD exercise

• Autumn 2004 set aim to agree top-top and
  intermediate ISIC 4 aggregations for reporting
  national accounts data by activity
• Initial proposals from Eurostat, UNSD and France
• OECD analysts raised issues
• international comparability, relevance, and
  continuity for long time series analysis
• the needs of input-output, policy interests,
  productivity analysis, separately identifying
  activities that follow different tracks in
  economic cycle
• OECD SNA Industry EDG established to encourage
  participation
• Proposals developed in consultation with Eurostat
  and UNSD

8
Process

• First OECD proposal circulated February 2005
• Revised proposal in light of comments 24 May
• Set out specific questions on most contentious
  issues
• Sent to all OECD member national accountants,
  EDG, classifications experts, Eurostat, UNSD
• Reviewed by UNSD Expert Group on Classifications
  June 2005
• Comments received from 15 countries, Eurostat and
  ECB

9
Constraints

• Preference for following ISIC structure
• ISIC 4 draft was changed in March and August 2005
  now finalised
• Some ISIC structural and ordering changes on real
  estate and public administration made for top-top
• Take into account current ISIC 3 aggregations
• Consider Eurostat A65 draft US BEA GDP by
  industry (65)

10
OECD proposal for Top-top aggregation
11
Illustrative v.a. weights for selected countries
12
Responses on top-top

• i) Group OPQ and RSTU or ii) O and PQRSTU
• i) 9 ii) 7 very close but chose option i)
• Support A10/11?
• Yes 14, No 2
• Two suggested A12 with mining
• One favoured A10 combine L with MN
• One favoured A6 if to be used for quarterly
  reporting

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Proposal for intermediate aggregation A38
14
Proposal for intermediate aggregation 2
15
Proposal for intermediate aggregation 3
16
Issues for intermediate aggregation

• Comparable SNA data reporting for Europe, N
  America and Asia-pacific and preferably wider
• Follow ISIC order and hierarchy
• Consider analytical relevance and continuity
• ICT, RD, Energy, Distributive trade
• Keep approximate A31 level of detail for
  manufacturing for continuity and robustness of
  data
• More service activities
• Eurostat and US A65 levels

17
Responses on intermediate proposal

• Not to break out mining of energy materials
• Yes 9, No 5
• Combine Section G Trade divisions into one for
  international comparability
• Yes 11, No 3
• Agree split on human health and social work
• Yes 12, No 3
• Break out RD
• Yes 13, No 3
• Break out manufacturing at about same level as
  A31
• Yes 10, No 1
• Keep the group manufacture of transport equipment
  as in A31
• Yes 9, No 4

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Questions and Proposed Next Steps

• Can these proposed aggregations be accepted for
  SNA data reporting? In particular
• Do you agree the A10/11 proposals are suitable
  for an ISIC top-top aggregation for SNA data
  reporting
• Do you agree the proposed intermediate A38 is
  suitable for SNA data reporting?
• Any further comments are invited
• Subject to delegates views a final OECD paper
  would be submitted to ISWGNA in November for
  consideration by the SNA AEG January 2006
• P.S. Should a standard grouping for service
  activities be recommended or not?

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Thank you for your attention