National Statistical Institute

"Short-term Business Statistics and Statistics of Transport” Department

Lyubomira Dimitrova

State expert

2, P. Volov Str.; 1038 Sofia, Bulgaria

[email protected]

+359 2 9857 122

The Industrial Production Index is the most important short-term economic business indicator, which aims to measure at a monthly frequency the ups and downs of industrial production during the long period of time. Monthly survey allows identifying the turning points in economic development at an early stage; also, the timely industrial production index is one of the most important measures of economic activity.

The Industrial Turnover Index measure the development of the market of goods and services. Turnover index gives measure of the development of the receipts of sales including the sales of goods (merchantmen goods) and services provided to other parties.

 Industrial Production and Industrial Turnover Indexes measure changes in production and respectively in turnover between two different periods of time. This information is suitable for monitoring of current economic developments and short-term forecasts.The survey do not attempt to measure the actual production level; it aims to measure the average change in value of production between two points of time.

· Classification of economic activities (CEA-2008, for international use NACE.BG-2008);

· Main industrial groupings (MIGs).

Industrial Production and Industrial Turnover Indices are calculated by economic activities for Mining and quarrying industry, Manufacturing, Electricity, gas, steam and air conditioning supply and Water collection, treatment and supply (NACE.BG-2008 Sections B, C, D and Division 36). Indices are calculated by economic activities at division level (2-nd digit level of NACE.BG-2008), at section level, for Main Industrial Groupings (MIGs: Intermediate products, Investment products, Energy products, Consumer durable products and Consumer non-durable products) and for total Industry level.

Industrial Production index: This index aims to follow the monthly change in the value of industrial production. The industrial production index is compiled from deflated value of production. For the purpose of monthly survey the production value includes:

+ Receipts from sales of finished products, goods and services

- Value of goods purchased for resale in the same conditions as received

+/- Change in stocks of finished products

Deflation is done with the Producer price indices, resulted from the monthly PPI survey.

Turnover: The turnover comprises all market sales of goods and services of the observation units.

The surveyed unit is enterprise (Legal unit considered as enterprise).

The total population includes about 31 851 industrial enterprises. The sampling population includes about 7200 enterprises with more than 10 persons employed of which sample of approximately 3 900 units are surveyed each month. The surveyed enterprises have an approximate share of 98.0% in the total turnover in industry.

At national level: The indices are calculated and published total for the territory of Bulgaria. At European level: Eurostat calculates and publishes aggregated data for EU Member States (EU28) countries and for the euro area (EU19) countries. Eurostat publishes data received from the 28 EU Member States, Norway and from the candidate countries.

The indices are published as time series from January 2000.

2021.

Indices (%)

Month

National Legal basis: The Law on Statistics (Article 20) states that all persons that manage or represent legal persons, are obliged to provide the National Statistical Institute and the Bodies of Statistics with reliable data when filling-in forms and questionnaires on surveys included in the National Statistical Programme, for which mandatory participation is provided.

Obligation on units to provide data: The survey is included into the National Statistical Programme – it is compulsory.
The Law of statistics includes provisions relating to fines, which can be imposed for refusal, non-response and delay. They are laid down in specific Chapter 9 “Administrative and liability provisions” in article 52.

Regulation (EU) 2019/2152 of the European Parliament and of the Council on European business statistics, repealing 10 legal acts in the field of business statistics (EBS-Regulation) and the Commission implementing Regulation 2020/1197.

Indicators are transmitted to Eurostat at the same time with their national publication.

Industrial production indices are provided to UN and to IMF.

Regulation (EC)  223/2009 on European statistics (recital 24 and Article 20(4)) of 11 March 2009, stipulates the need to establish common principles and guidelines ensuring the confidentiality of data used for the production of European statistics and the access to those confidential data with due account for technical developments and the requirements of users in democratic society.

The Law on Statistics includes provisions relating to data confidentiality and protection of secrecy, which are in compliance with the EU legislation and standard European practice. In the Law is stated that individual data received and collected at the time of statistical surveys shall be statistical confidentiality and shall be used only for statistical purposes. Individual data, obtained for the purposes of the statistical surveys, shall not be used as evidence to the bodies of the executive powers and the judicial authorities. Requirements, obligations and measures for data protection, as well as fines that can be imposed, are treated in separate chapters, namely Chapter 6 on "Protection of secrecy" and Chapter 9 on "Administrative penal provisions".

Article 25 of the Law on Statistics specifies the criteria, according to which certain data cannot be made public or released - individual data, data which could be indirectly identified, as well as aggregations of less than three statistical units and/or when the relative share of one parameter is more than 85% of the total volume of this parameter for all population units.

Data, which according to the Law on statistics are confidential, are not published.

The date for publication of statistical information is listed in the Release Calendar presenting the results of the statistical surveys carried out by the National Statistical Institute.

Indices of industrial production and turnover indices are published 37-40 days after the end of the reference month.

Release calendar.

Data are simultaneously disseminated to the public through a news release on Industrial production index. Indices of industrial production and turnover indices are published on the NSI website, after which those data are simultaneously accessible to all users.

Monthly

NSI publishes regular monthly press release on Industrial production indexes 37-40 days after the end of the reference month and it can be found here.

Paper publication: Brochure "Bulgaria".

Statistical Referense Book

Industrial Production Indexes and Industrial Turnover Indexes time series (from January 2000) at 2-nd digit and higher level of aggregation of NACE.BG-2008 are available on the website of NSI – in the on-line database INFOSTAT.

Micro data are neither distributed nor provided to the users.

Dissemination on request: Special tables may be obtained from the  "Relations with users and e-services" Department of NSI.

· Methodology "Industrial production index, Turnover indices in industry" ;

· Eurostat Methodology papers on of short-term business statistics;

Regulation (EC) № 1165/98 and amendment Regulation (EC) № 1158/2005 on Short-term statistics required by the European Commission (Eurostat) regularly (every three years) to report to the European Parliament on the applicability of short-term data, their quality and revisions of the data. Every year Member States should present to Eurostat detailed information about the quality of a particular short-term indicator, which is part of the Principal European Economic Indicators (PEEIs). Metadata on IPI containing information on the main quality characteristics (relevance, accuracy, data revisions, coherence and comparability) is prepared and disseminated on the NSI website.

The documentation on quality management is available on the Internet.

The legal framework which regulates the production of data from Short-term business statistics states that statistical data compiled within the EU system must be of satisfactory quality and produced data are comparable between Member States. Verification of data is done through the process of conducting a statistical survey - from respondents, from experts in the regional statistical offices and from national experts in NSI. Identified inaccuracies and errors are removed timely and comparable data of good quality are provided. The quality of statistical information and its production process is ensured by the provisions of the European Statistics Code of Practice. The documentation on quality management is available on the Internet.

The quality assessment of the Index of industrial production is based on quality requirements of the ESS (relevance, accuracy, timelines and punctuality, accessibility and clarity, coherence and comparability). The monitoring of the quality of the indicator, updating survey methodology, self-assessment of survey manager is carried out. The response rate is near 99 per cent. The coefficient of variation used as the main measure of the accuracy of estimate is about 0.2 per cent.

Main users of the information:

· Institutions at European level and Multi-national organizations - Eurostat and other main Departments (Directorates-General) of EC; ECB; UN; IMF; WB; etc.;

· Presidency, National Assembly, Ministries, National Bank and other representatives of central and local government;

· Research institutes, universities;

· Media, professional organizations, business;

· Internal users: Directorate "Macroeconomic Statistics".

Not available

The scope and the level of detail meet the requirements. The time series starts form January 2000.

Sampling survey: The total population includes about 31851 industrial enterprises. The sampling population includes about 7200 enterprises with more than 10 persons employed of which sample of approximately 3 900 units are surveyed each month. The surveyed enterprises have 98.0% share in the total turnover in industry.

Еnterprises that have less than 9 employees which have share of 71% in terms of the number of industrial companies and only 1.9 % in terms of the turnover are not observed monthly. 

The sample method used is Stratified random sample. Criterion for stratification of the enterprises is ‘number of persons employed’. First enterprises are stratified by groups (3-th digit level of NACE.BG-2008) and then in each group they are stratifies by number of persons employed.

Coefficient of variation is used as an indicator on precision. It is computed as a percentage.

The main source of  non sampling errors are the missing reports.

There are several strategies in dealing with non-response: (1) Effective actions are taken before and after data collection process in order the non-response rate to be reduced. (2) Usage of presumable models for the mechanism of the non-response and for relations of different indicators in order to create estimators, which are able to correct estimates in the case of non-response.

Actions to reduce the non-responce include:

• Sending the informative reminder letters to the respondents;
• Depending on the relative importance of non-respondents in terms of their size or representativeness in the activity, the postal survey is supplemented by telephone calls and/or direct contact and collection of data for enterprises.

The Industrial Production Indices and Industrial Turnover Indices (total, on domestic and on non-domestic market) are firstly released 37-40 days after the end of the reference month. Data for the current month are provisional when first released. Provisional data are identified in footnotes. During the current month more precise data for the previous month are collected. Each month data for the current month is released as preliminary and data for the previous month as final.

Industrial production indexes are published, according to the deadlines in the EU Regulations on STS (40 days after the reference month), while Turnover indexes are published 20 days before to the deadlines in the EU Regulations on STS (60 days after the reference month).

 Indices of industrial production and Turnover indices are representative for the whole country, they are not representative for the regions of the country.

To calculate the index of industrial production and turnover indices NSI apply methodology, which is in line with international standards. In this sense, the comparability of the indicators across countries can be considered as very good. 

Regulation (EC) № 2019/2152 requires “Every five years, Member States shall rebase the indices using as base years the years ending with a 0 or a 5. All indices must be rebased on the new base year within three years after the end of the new base year“.  All short-term indicators presented in the form of index are calculated and published at 2021as a base year. The time series has been recalculated according to the new base year and are posted on the website of NSI.

The methodology applied for calculation of the index of industrial production and industrial turnover indexes is in line with international standards.

All NACE levels is consistent as Industrial production indexes and Industrial turnover indexes at higher levels of aggregation (2-nd digit level and higher) are calculated as weighted average - indexes at lower levels are weighted respectively with the value added at factor cost structure and turnover structure in the base year. In the case of WDA and SA data, direct adjustment is used.

The online information system for data collection, data editing and data processing "Business cycles" reduces the time needed for collecting data from enterprises and ensures more efficient data processing.

Industrial production indices and turnover indices in industry usually are revised two times. Each month data for the current month are published as preliminary and for the previous month as final. At the beginning of each year the indices for the previous year are reconciled on the basis of the comprehensive annual data from SBS.

Revision policy in the case of Industrial Production Index and Industrial Turnover Indices:

• Once per month, after one month when more precise and complete data for previous month are available - Estimates are corrected when definitive figures are available;
• Annual revision - Revisions come from the Annual SBS survey – annual production and turnover, that are calculated based on Structural business statistics.

Mean Absolute Revision (MAR) and Mean Revision (MR) are used as revision indicators for the Producer Price Indices.

Minor changes are made at the time when the revision is introduced and they are marked in footnotes in the relevant published tables.

The data for the current month are marked as ‘preliminary data’.

Only final data are available in the time series posted on the NSI website They are calculated on year-on-year growth rates for original and calendar adjusted date and on period-on-period for the seasonally adjusted data. MAR and MR for original, seasonally adjusted and calendar adjusted data for 2021-2023:

The indices are based on monthly survey “Sales in industry, construction, trade and services”.

For calculation the Indices of industrial production, NSI uses approximation to the ‘production value’ that is calculated as receipts from sales of finished products, goods and services minus value of goods purchased for resale in the same conditions as received, corrected with changes in stocks of finished products.

Turnover includes all receipts from sales (including sales of raw materials). Industrial production and turnover cover all activity of the enterprises, values of subsidiary, non-industrial activities of the enterprises are included.

 Monthly

Sampling survey. The total population includes about 31 851 industrial enterprises. The sampling population includes about 7200 enterprises with more than 10 persons employed of which sample of approximately 3 900 units are surveyed each month. The surveyed enterprises have 98.0% share in the total turnover in industry. The sample method used is Stratified Random Sample. Criterion for stratification of the enterprises is ‘number of persons employed’. First enterprises are stratified by groups (3-th digit level of NACE.BG-2008) and then in each group they are stratifies by number of persons employed. Enterprises with 100 or more employees are surveyed exhaustively. Enterprises employing between 10 and 99 employees are randomly sampled, enterprises that have less than 9 employees are not observed monthly. Data collection media:

• Online through Information system “Business cycles”;

• Paper questionnaire. The questionnaires are sent out to the respondents and collected by regional statistical offices, where the information is entered into Information system “Business cycles”.

Validation of data in the report:

When recording the data, the Information system STS carries out obligatory and recommended controls according to set with validation rules. In the case there are errors, it displays a warning dialog error in the report. The system does not allow completion of the report until they have corrected these errors by statutory controls.

Validation of the output data:

Output data is verified at group level with regard to the previous month, the same month of the previous year and also with regard to extreme values, if necessary data is validated at the level of statistical units.

The production value of industrial enterprises depends on quantities produced as well as depends on chances in prices. For Industrial production index compilation, the values are deflated with Producer price indices in order to isolate the price (inflation) fluctuations and the real production developments to be presented.

Turnover indices are calculated through direct comparison of the values of the turnover at current prices, turnover values are not corrected with the price changes. The Turnover indices reflect the development of the value of sales as well as changes in prices.

Calculation of Industrial production index:

• Calculation the Industrial production index at group level (3-th digit of NACE.BG-2008). At that stage index calculation is made on the bases of direct comparison of the data from the current month at constant prices and data on the average monthly production value in the base year. Production value is deflated at 3-th digit level of NACE.BG-2008 with the Total producer price index that is calculated as weighted average of producer price indices on domestic market and producer price index on non-domestic market.
• Calculation of Industrial production index at higher levels of aggregation. Industrial production indices at higher level of aggregation – division (2-nd digit level), section, Main industrial groupings and total Industry level are calculated as base weighted (Laspeyres) indices - that is to say they are weighted according to the value added at factor costs in the base year.

The source for activity weight -value added at factor costs is Structural Business Statistics survey that is based on annual enterprise’s accounts, it is defined as difference between production value and intermediate consumption minus duties and taxes linked to production.

Calculation of Industrial turnover index:

Three Turnover indices are calculated: Turnover indices on domestic market, Turnover indices on non-domestic market and Total turnover indices.

First Turnover indices on domestic market and Turnover indices on non-domestic market are calculated. At the lowest level of aggregation (3-th digit level of NACE.BG-2008) indices calculation is made on the bases of direct comparison of the data from the current month and data on the average monthly turnover value in the base year.

At higher levels of aggregation Industrial turnover indices on domestic and on non-domestic market are calculated as weighted average - indices at lower levels are weighted with turnover structure on the domestic or respectively on the non-domestic market.

Total Industrial turnover indices are calculated from Turnover indices on domestic market and Turnover indices on non-domestic market weighted with the turnover structure on domestic and on non-domestic market to the total value of turnover at each level of aggregation.

In accordance with Regulations concerning STS only Industrial production indexes are seasonally adjusted (Index of turnover in industry are not seasonally adjusted, only original (not seasonally adjusted) data are published.

Industrial production indexes are published as:

• Raw time series;

• Working day adjusted time series;

• Seasonally adjusted time series.

In accordance with Regulations concerning STS, the Industrial Production Indices are to be seasonally and working day adjusted. The software used for seasonally and working day adjustment is JDemetra +. The method used is TRAMO-SEATS. The time series at different levels of aggregation (division, section, MIGs and total industry) are seasonal and working day adjusted by applying the direct method.

Revisions of seasonally and working day adjusted data:

• model updated once a year including revision of historical data,

• monthly observations presented with revision 1 month backwards.