UK work to date and the use of allocation factors:The Problems of Mixed Classes in Economic Classifications

OECD Workshop, Paris, 4-5 December 2006

Department for Culture, Media and Sport Improving the quality of life for all

DCMS – our context

• Government Department with policy responsibility• Economic measurement focus, rather than social• Separate from the National Statistics institute (ONS)• Historical emphasis on 13 ‘Creative Industries’ • Development of Mapping Document & Statistical Bulletin• Development of an ‘Evidence Toolkit’ for all DCMS sectors

Department for Culture, Media and Sport Improving the quality of life for all

How have we tackled the issue?

• “Activities which have their origin in individual creativity, skill and talent and have a potential for wealth and job creation through the generation and exploitation of intellectual property”

• But definition is constrained when using official statistics• Rigid NACE/SIC system – set definitions, not often updated• Official sources assign businesses based on ‘principal

activity’• Survey data – owned by the ONS• Need to derive and apply allocation factors

‘Creative’ Industries

Department for Culture, Media and Sport Improving the quality of life for all

How have we tackled the issue?

• What is a creative activity/business?• Different dimensions

Employment, turnover etc.Regional / International

• Sum of disaggregates ≠ aggregated national figure• Best-estimates, for indicative purposes• Planning to review by analysing micro-data• Wider footprint – even harder to identify

Allocation Factors

Department for Culture, Media and Sport Improving the quality of life for all

How have we tackled the issue?

• Classes are clear (100%)92.32 Operation of arts facilities

• (5 digit) class exists, but survey data not available74.20 Architecture and engineering activities…

74.20.1 Architecture activities

• Class too broad – activity is ‘hidden’22.15 Other publishing52.50 Retail sale of second-hand goods in stores

Allocation Factors - Examples

Department for Culture, Media and Sport Improving the quality of life for all

What have we found?

Total GVA Contribution 7.3%

By selected sector…

…Software, Computer Games & Electronic Publishing 2.7%

…Publishing 1.2%

…Designer Fashion 0.05%

Exports £13bn

Employment 1.8m

…in Creative Industries 1.0m

…in other creative occupations 0.8m

Number of Businesses 117,500

Value of UK Creative Industries - Headline Findings

Department for Culture, Media and Sport Improving the quality of life for all

How have we tried to develop?

• Establish a definition that is robust on a conceptual and technical level• Propose consistent approach / methodologies• Covers all DCMS sectors (culture, media, sport, tourism)• Based on NACE / SIC• Framework based on domains and functions• ‘Cultural cycle’ - covering the production part

Development of an Evidence Toolkit

Department for Culture, Media and Sport Improving the quality of life for all

Toolkit: ‘Cultural Cycle’

Creation

Making

Education & Understanding

Archiving & Presentation

Exhibition & Reception

Dissemination

Department for Culture, Media and Sport Improving the quality of life for all

Where have we got to?

• Universal agreement impossible, but have frameworks

• Good ground work that now needs developing

• Consistent series for the Creative Industries

• Attempting to ‘close down’ old arguments

Department for Culture, Media and Sport Improving the quality of life for all

Issues still facing us…

• Advocacy – Government & Industry• To manage or direct policy• To add (more) credibility to what we say

But…• How accurate do we need to be?• Are we going over old ground?• How can we expand & develop?

Why do we need data? Who uses it?

Department for Culture, Media and Sport Improving the quality of life for all

Other ways to take forward…

• Satellite Accounts National Statistics institute suggested Support idea, but how use? Needs expertise / resource

• More industry involvement? Data collection?

• Improve credibility Need to make comparisons (within UK /

international) More consistency in approach