8. Revisions

There are revisions to UK productivity estimates in this release due to the publication on 30 September 2015 of revised National Accounts estimates consistent with the UK National Accounts Blue Book Book 2015 which will be published on 31 October 2015. An article summarising the effects of methodological, classification and other changes implemented in the latest estimates was also published on 30 September 2015.

The effects of the changes in Blue Book 2015 have broadly increased GVA since 1997, though the increase is relatively modest and much smaller than the impact of changes in Blue Book 2014. The largest upward revisions come from extending the coverage of incomes accruing to small businesses and from newly available survey data from the Annual Business Survey and the International Trade in Services Survey, among others.

Output in recent years in the services sector has benefited from the upward revisions to the National Accounts, while the production sector has seen slight downward revisions over the same period.

In contrast to GVA data, there are few revisions to employment data from the Q1 edition of Labour Productivity. However, following feedback from users we revisited the seasonal adjustment review of productivity hours, conducted prior to the last release. Details of the second review are available from the information note published in September.

The additional review has resulted in hours data that are less volatile than those published in the previous release. This is partly due to a shift in the seasonal adjustment methodology, though we have also benchmarked hours data to Total Actual Weekly Hours Worked data from the Labour Force Survey.

Because shifts in GVA estimates tend to dominate changes to short term labour productivity, the effects of the revisions noted above have led to a larger upward shift in recent output per hour data for services than for production. The upward revision is notable in the finance, insurance and other business services industry, where output per hour is on average 0.9% higher since Q1 2008 following revisions from Blue Book 2015 and changes to hours data. Productivity has grown in this industry despite the corrections to insurance data noted above.

Blue Book 2015 changes have also led to revisions to estimates of Compensation of Employees (COE) which affects estimates of unit labour costs. Growth of COE has been revised down by 0.3%, 0.4% and 0.9% in 2012, 2013 and 2014, respectively. Over a longer time span, the impact of Blue Book 15 on COE is much more modest.

Whole economy ULC growth has been revised downwards by 1.2% in 2013 and 1.0% in 2014. The downward revision in 2013 mainly reflects the large downward revision in growth of output per hour, while the 2014 revision is mainly due to the downward revision to COE growth.

Table A below summarises differences between first published estimates for each of the statistics in the first column with the estimates for the same statistics published three years later. This summary is based on five years of data, that is, for first estimates of quarters between Q3 2007 and Q2 20121, which is the last quarter for which a three-year revision history is available. The averages of these differences with and without regard to sign are shown in the right hand columns of the table. These can be compared with the estimated values in the latest quarter (Q2 2015) shown in the second column. Additional information on revisions to these and other statistics published in this release is available in the Revisions Triangles (2.46 Mb Excel sheet) component of this release.

Table A: Revisions analysis Whole economy Revisions between first publication and estimates five years later (2007 Q3 - 2012 Q2) Change on quarter a year ago Value in latest period (per cent) Average over 5 years (bias) Average over 5 years without regard to sign (average absolute revision) Output per worker 1.1 0.1 0.9 Output per job 1.3 0.1 0.9 Output per hour 1.3 0.1 0.8 Unit labour costs 2.2 -0.2 1.3 Unit wage costs 1.9 -0.4 1.3 Source: Office for National Statistics Download this table Table A: Revisions analysis .xls (25.1 kB)

This revisions analysis shows that whole economy labour productivity growth estimates have tended to be revised up very slightly over time (on a year-on-year basis). Growth of unit labour costs and unit wage costs has tended to be revised downwards. Were the average revisions to apply to the current release, growth of output per hour in the year to the second quarter of 2015 would be revised from 1.3% to 1.4% over the next three years. Growth of unit labour costs would be revised from 2.2% to 2.0%, while growth of unit wage costs would be revised from 1.9% to 1.5% over the same period.

A research note, ‘sources of revisions to labour productivity estimates’ (145.4 Kb Pdf) is available on the ONS website.