Definitions                                                                                                ANNEX 1

General – Interim adjusted Labour Force Survey (LFS) estimates

Revised national and regional mid-year population estimates (MYE) for 1992 to 2002 were published by ONS in September and October 2003. In November 2003, ONS published new provisional estimates for Manchester for the years 2001 and 2002. To maintain consistency in LFS time series, only population data for which consistent back series are available can be used in the LFS estimation process. Therefore, while the population data released in September and October 2003 are used in the LFS interim estimates, the revisions to allow for the new Manchester figures cannot, as yet, be used. When revised population figures for 1992 to 2000 are published, interim revised LFS series for these years will be published as soon as possible afterwards. By 2005, it is planned that modernised LFS processing systems will enable the new MYE for 2004 to be incorporated into revised LFS microdata much more swiftly than is now possible. The revised LFS time series to be released in September 2005 should therefore be produced entirely consistently with the LFS microdata, without the need for any interim adjustment procedure. 

1. Gross Value Added and household disposable income per head

Gross Value Added (GVA)

The estimates published here have been calculated on the basis of the European System of Accounts 1995 (ESA95). GVA is the major component of gross domestic product (GDP). Under ESA95 the difference between GVA and Gross Domestic Product (GDP) is that GDP includes taxes (less subsidies) on products (mainly Value Added Tax) while GVA does not. ONS does not presently regionalise taxes on products.

These indicators contain two separate measures of economic activity that fall under the broad definition of ‘GVA’. The data termed GDP in previous publications are taken from the regional economic accounts, produced by ONS, which are calculated based on a series of economic and labour market surveys. The second set of GVA data that appear in Tables 3(a) and 3(b) are based on a single survey: the Annual Business Inquiry/2 (ABI/2). The GVA estimates taken from the regional economic accounts are a much broader measure of regional economic activity than the ABI series. 

Regional GVA data are subject to adjustments in three key areas: adjustments for coverage; adjustments needed to move the accounts onto an ESA 95 basis; and adjustments for balancing purposes. More information can be obtained from

Gross disposable household income (GDHI)

The household sector includes traditional households within the UK, in addition to people living in institutions such as retirement homes, hospitals and prisons. This sector also includes the activity of the non-profit making units that provide a service to households, for example charities and most universities. 
GDHI is defined as total household income less payments of current taxes on income and wealth (such as income and property taxes) and social contributions such as pension and National Insurance deductions. This series is compiled under the latest ESA95 framework. 

It should be noted that neither GVA or GDHI are the same as ‘wealth’. It is possible for a household to possess substantial material wealth and assets while receiving a comparatively low level of income.

2. Labour productivity in manufacturing and other industries

This is calculated by dividing residence-based GVA for manufacturing, services and the ‘other industries’ sector by the number of workforce jobs within each sector.

Estimates of the total number of workforce jobs are calculated by summing employee jobs (mainly collected through postal surveys of employers), self-employment jobs from the Labour Force Survey, those in HM Forces and Government-supported trainees. The count of jobs includes both full- and part-time jobs.

The estimates of GVA are drawn from the regional economic accounts produced by the Regional Accounts branch in ONS. These differ from the GVA estimates included in Indicator 1 as they are residence-based: the earnings of employees who commute across regions are allocated to the region where they live and not where they work. In practice, residence and workplace-based GVA differ only in London, the South East, and the East of England, as ONS does not make adjustments for other regions. 

Using residence-based GVA and workplace-based employee jobs means that the estimates for regions with high levels of in-commuting, such as London, may be deflated, while in areas with net out-commuting such as the East of England, the figure could be overstated. 

3. Manufacturing investment and output by UK and foreign-owned companies

Gross Value Added (GVA) from the Annual Business Inquiry is used to gauge the output of foreign-owned companies. For a further description of GVA, please refer to section 1 of the Definitions. 

Net Capital Expenditure is used as a proxy for investment and is calculated by adding the value of new building work acquisitions, less disposals of land, and existing buildings, vehicles and plant and machinery.

Pre-1998 data are from the Annual Census of Production (ACOP). Since 1998 the data are taken from the Annual Business Inquiry/2 (ABI/2), an integrated survey of accounting information from businesses and other establishments. This survey was launched at a regional level by ONS during September 2002, amalgamating a number of existing ONS business surveys, namely; Annual Census of Production, Annual Retail Inquiry, Annual Motor Trades Inquiry, Annual Catering Inquiry, Annual Property Inquiry and the Annual Service Trades Inquiry.

4. Exports of goods

The counts in Table 4(b)(ii) of companies exporting to EU and outside the EU are not fully comparable. Company details for businesses’ export transactions with non-EU countries are mandatory and are automatically recorded by HM Customs and Excise. The counts for exports to non-EU countries are taken from these. However, because of the Single European Market, there is far less recording of companies exporting to the EU. Supplementary declarations for companies exporting to the EU are recorded through the Intrastat system, which only picks up businesses exporting goods with a value in excess of (during 2003) £233,000 to the EU. Hence, the company counts of EU exporters will be artificially low as compared to the count for exporters to the rest of the world. Note that companies who export to both EU countries and the rest of the world will appear more than once in the company count, that is, in both parts of table 4(b). 

Comparisons between regions should be interpreted with care because the value added of an export product may have been generated in areas other than the region from which the item was actually exported.

Export trade is assigned to a region through the postcode associated with a company’s VAT registration. Some adjustments have been necessary for exports to the EU to ensure that manufacturing that takes place at branch premises is properly allocated to the region where the branch is situated. Exports to countries outside the EU already contain a regional coding.

Exports of goods by employee job are DTI estimates using Customs and Excise data for value of exports of goods and employee jobs as a denominator. The employee jobs data were drawn from the workplace-based Short-Term Employment Survey (STES) produced by ONS.

5. Average earnings

Estimates of average earnings are drawn from the New Earnings Survey (NES) and include remuneration for overtime worked during the survey period and shift pay, but not other payments such as profit shares or annual bonuses. 

NES data are collected in April of each year. The estimates may be affected by seasonality.

6. Employment and employee jobs

Tables 6(a) and 6(b) detail the number and percentage of people of working age in employment who are resident in each region or country. The data contained in both tables are drawn from the Labour Force Survey (LFS) and are seasonally adjusted. People aged 16 and over are classed as employed by the LFS if they have worked for at least one hour in the reference week or are temporarily away from a job (e.g. on holiday).

The data contained in Table 6(c) are drawn from the Short-Term Employment Survey (STES) carried out by ONS and show the number and percentage of employee jobs on a workplace basis. The STES measures the number of employee jobs on a quarterly basis and unlike the data in Tables 6(a) and 6(b) does not include self-employed people. Additionally, the data for regions in Table 6(c) may not sum to UK or England totals because of approximations in allocating national estimates to regions.

7. Unemployment

This is based on the International Labour Organisation (ILO) definition of unemployment which includes as unemployed all those who are out of work, want a job, have actively sought work in the last four weeks prior to interview and are available to start work within the next fortnight, or are out of work and have accepted a job they are waiting to start in the next fortnight. The data are seasonally adjusted.

The unemployment rate is the percentage of economically active people who are unemployed. To be economically active, a person must either be in employment (see definition under 6. Employment and employee jobs) or unemployed (ILO definition).

8. Claimant count

The claimant count is based on the number of people claiming Jobseeker’s Allowance (JSA) and National Insurance credits at Jobcentre Plus local offices on a particular day each month. People claiming JSA must declare they are out of work, available for, capable of and actively seeking employment during the week in which the claim is made. Claimant count rates express the number of JSA claimants as a percentage of the sum of claimants and workforce jobs in the area. The number of workforce jobs is comprised of employee jobs, agricultural jobs, HM armed forces, self–employed and persons on government–supported training schemes. 

The figures for long-term JSA claimants (12 months or more) only account for computerised claims – around 1 per cent of claims are dealt with manually, and these are excluded.

9. DfES Public Service Agreement targets (England only)

In December 2002, the Department for Education and Skills (DfES) launched “Delivering Results: A Strategy to 2006”. This outlined three objectives, two of which are relevant to the statistics in this publication, along with associated milestones and targets for delivery:

DfES Objective 2 (England)

Enable all young people to develop and to equip themselves with the skills, knowledge and personal qualities needed for life and work.

Relevant Targets/Milestones

Raise standards in schools and colleges so that:
- Between 2002 and 2006 the proportion of those aged 16 who get qualifications equivalent to 5 GCSEs at grades A* to C rises by 2 percentage points each year on average and in all schools at least 20% of pupils achieve this standard by 2004 rising to 25% by 2006; and 

- The proportion of 19 year olds who achieve this standard rises by 3 percentage points between 2002 and 2004, with a further increase of 3 percentage points by 2006 (Table 9(a); baseline is the autumn 2002 figure of 74.8%).

DfES Objective 3 (England)

Encourage and enable adults to learn, improve their skills and enrich their lives.

Relevant Targets/Milestones

- Reduce by at least 40 per cent the number of adults in the workforce who lack NVQ 2 or equivalent qualifications by 2010 (baseline is Autumn 2001 figure of 71.6%). Working towards this, one million adults in the workforce to achieve level 2 between 2003 and 2006

The Learning and Skills Council (LSC) has also set targets for England, including one which relates to Table 9(b):

LSC target (England)

52 per cent of adults will be qualified to at least NVQ level 3 (Table 9(b))

10. Proportion of Income Support claimants

Income Support (IS) claimants can be grouped into Minimum Income Guarantee (MIG – for those over 60 and their partners), Disabled, Lone Parents and Other. From October 2003, IS can be paid to a person who is aged 16 to 59 years old, is not working 16 hours or more a week and whose income is less than what is considered necessary to live on. 

Pension Credit was introduced in October 2003 for those aged 60 and over, replacing the Minimum Income Guarantee benefit. This leads to the termination of Table 10(b)(i) at August 2003, and the addition of Table 10(b)(ii): Pension Credit claimants as a proportion of the 60+ population. Former MIG claimants are all entitled to Pension Credit, but Pension credit also brings in pensioner households whose incomes are slightly above the eligibility levels for MIG and who have saved money in an occupational or personal pension, or a savings account, or both. As a result, the proportions in Table 10(b)(ii) are higher than those in Table 10(b)(i). 

While MIG allowed either partner to claim, Pension Credit needs the partner aged 60 or over to be the claimant. Households where the partner aged under 60 was the MIG claimant were invited to make a new claim with the partner aged 60 or over as the Pension Credit claimant. For about 15,000 of these households, no new claim was received as of November 2003. They continue to receive IS, but are not currently included in Table 10(a), Table 10(b)(i) or Table 10(b)(ii). Over time, new claims will be made for all these households and they will move into Table 10(b)(ii). 
As a result of the introduction of Pension Credit, the population base for Table 10(a) changes from 16+ up to and including August 2003, to 16-59 year olds from November 2003 onwards. 

11. Income deprivation

Table 11 and Chart 11 provide the percentage of the population within families that are dependent on Income Support (IS) benefit. The percentage for each of the English regions is included alongside the proportion for the 20 per cent of the population living within the ‘most deprived’ wards within each region and England.

For this indicator ward level deprivation has been defined according to the Indices of Multiple Deprivation 2000 (IMD 2000). The IMD 2000 is an index for areas in England consisting of 33 indicators of deprivation that fall under 6 broad dimensions: income, employment, health and disability, education training/skills, housing and access to services.

For this indicator, the number of IS ‘dependants’ reflect the number of persons living in families where at least one member is receiving income support benefit. The information are derived by the DTI using the Income Strand of the IMD 2000 as well as mid–1998 population estimates taken from the Neighbourhood Statistics web site. The ward level IS estimates used in this indicator were supplied by the Department for Work and Pensions.

12. Business registration and survival rates

VAT registrations are not synonymous with business start-ups; some registrations are the results of changes in ownership or legal status of a business. In Great Britain the total number of business start-ups is estimated to be around twice the number of registrations for VAT. It is estimated that between 1995 and 1999 there were around 530,000 businesses created.

Businesses with annual turnover below the VAT threshold (£55,000 at the end of 2002) may decide not to register for VAT for a variety of reasons, and so would not be included in these estimates. 

The data are compiled from the Inter-Departmental Business Register (IDBR). The IDBR is a structured list of around 2 million units in the UK available for the selection, mailing and grossing of statistical inquiries. It is supplied by the ONS and is mainly used as a sampling frame for official business surveys.

The estimates refer to the location of the head office or main centre of business activity. If a new factory owned by a business is located elsewhere in the UK then it does not appear as a new registration.

Care should be taken when comparing the rates of VAT registrations/population or stock of businesses between regions since the estimates can be influenced by variations in commuting, industry mix and differences the profile of businesses between regions as well as ‘actual’ changes over time. In addition, there are areas where the stock of businesses is relatively low, so the rate of business formations could be artificially inflated. 
The ‘survival’ rates contained in the Table 12(c) are not derived from actual business closures. Firms can be removed from the VAT register for a variety of reasons including: falling turnover, mergers, take-over and relocation in addition to the business actually ceasing trading. However, registrations and de-registrations are strongly correlated with the underlying trends in business ‘birth’ and ‘death’ rates.

13. Research and Development, and employment in high and medium-high technology industries

The survey of Business Enterprise Research and Development (BERD) is conducted by the ONS annually. It is based on a sample of around 4,000 businesses across the UK that are identified as performing research and development (R&D) activity by the Annual Business Inquiry. Included are all ‘large’ R&D performers, plus a sample of smaller businesses that are deemed as ‘lesser’ R&D performers. Government organisations, higher education establishments and registered charities are not included within the survey sample.

It is important to note that this survey assesses the value of R&D performed by businesses in the UK, irrespective of where the funding for the R&D activity came from (i.e. business, government or foreign funding). It also covers the R&D activity by UK firms on UK territory outside of the mainland (i.e. North Sea oil exploration). The sample size and response rates (at around 94 per cent) are sufficient to allow dissemination of R&D activity within businesses down to regional and sector level.

High and medium-high technology industry employee jobs

These estimates are drawn from the Annual Business Inquiry/1 and the Northern Ireland Census of Employment (carried out every two years). The definition of high technology industry itself is based on that specified by the Organisation for Economic Cooperation and Development (OECD) in 1997. The following table shows the sectors covered by the definition ‘high technology’ and ‘medium-high technology’ and which Standard Industrial Classification 1992 (SIC92) class or sub-class corresponds to each.

Sector SIC92

High Tech




Office machinery and computers






Medium High Tech


Scientific Instruments


Motor Vehicles


Electrical Machinery



24.0 (excluding 24.4)

Other Transport Equipment

35.2, 35.4, 35.5

Non-Electrical Machinery


14.       Transport

In Chart 14(a), the mode of transport used to travel to work is defined as follows:
Private - car, van, mini-bus, motorcycle.
Public - bus, coach, national rail and other rail (including underground).
In Table 14(b), the estimates are for those roads surveyed in all three years (1998, 2001 and 2003), rather than the full sample for each individual year. 

15.       Industrial Property and office rental costs

Type 3 - Industrial / Warehouse units: Steel framed on concrete base, concrete block or brickwork to 2m, metal PVC covered cladding above. Eaves height 4.3-5.5m with lined roof. 10-15 per cent office content. Detached on own site with private parking & loading facilities.

Type 1 Office Accommodation: Town Centre location. Self contained suite over 1,000 m2 in office block erected in last 10 years, good standard of finish with a lift and good quality fittings to common parts. Limited car parking available.

16.       Derelict and Vacant Land  

The information covering previously developed land now vacant or derelict are drawn from the National Land Use Database (NLUD) ( These data are based on a periodic survey of unitary and local authorities covering vacant and derelict sites and other previously developed land and buildings that may be available for redevelopment. Latest data refer to 2002.

Table 16 covers several distinct types of vacant or derelict land:

Previously developed vacant land: Land previously developed and is now vacant which could be developed without treatment. Treatment includes: demolition, clearing of fixed structures, foundations levelling etc.

Derelict land and buildings: Land so damaged by previous industrial or other development that it is incapable of beneficial use without treatment. This includes abandoned or unoccupied buildings in an advanced state of disrepair. 

All land that is unused or may be available for redevelopment: Comprises previously developed vacant and derelict land: vacant buildings; land or buildings currently in use, which are allocated in a local plan for any developed use, have planning permission for any use (including single residential dwellings with planning permission for at least one additional dwelling) or with known potential for redevelopment.

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