Jurriaan Biesheuvel

Indicators in Dutch economy:

Doing more with less

Seminar on the Role of National Statistical Offices in the production of Leading, Composite and Sentiment Indicators 8 - 10 December 2015 Geneva

Dutch economy

• Gateway to Europe

• Technology (electronic, bio, chemical)

• After USA largest exporting country of agriculture products (flowers)

• GDP: $800 billion

• 17 million inhabitants, GDP per capita: $52.000

2

Probing economic climate

Until 2008:

• 5 different organizations

• Similar questions in different questionnaires

• Varying quality

• No standard measures, hard to compare data

High administrative burden

(annoyance at companies)

3

Q. How do you expect your production to develop over the next 3 months?

Questionnaires with business related questions

Since 2008: Integration

4

Cooperation of 5 organizations

One main executor: Statistics Netherlands

Stratified sample survey:

• One questionnaire for all branches

• adapted to DG ECFIN1 requirements where necessary

Direct results

• Comparable

• Consistency

• Reduction sample size

• Reduction administrative burden

Automation • Reduction of working hours • Reduction of error sensitivity

1. DG ECFIN: Directorate-General for Economic and Financial Affairs

News center

5

Dutch business survey

6

• Monthly, quarterly, annually questionnaires

• Stratification: company size, region, business branch (NACE)

• Weighted by number of employees

R1 R2 R3 R4

RT

G1

G2

GT

S11

S12

S20

S10

ST

S…

branch

region

size

Indirect results

7

producer confidence

Composite Indicator:

Economic Indicators

• Confidence indicators

‐ Manufacturing industry

‐ Construction

‐ Retail trade

‐ Service sector

‐ Mining and quarrying

‐ Wholesale

• Job vacancy indicator

• Index order position

Comparison with European indicators

8

Economic Indicators

• Confidence indicators

‐ Manufacturing industry

‐ Construction

‐ Retail trade

‐ Service sector

‐ Mining and quarrying

‐ Wholesale

• Job vacancy indicator

• Index order position

DG ECFIN indicator:

Economic Sentiment Indicator

- Manufacturing industry

- Construction

- Retail trade

- Service sector

- Consumers

Business climate indicator (Industry: 5 questions)

Example: confidence indicator

9

Monthly survey for manufacturing industry: 11 questions in total

Q1. How do you expect your production to develop over the next 3 months? It will... Q2. Do you consider the current overall book order to be… Q3. Do you consider your current stock of finished products to be...?

+ = −

3 questions used for confidence indicator:

Example: confidence indicator

10

Balance: Total + minus total −

Seasonal correction

Q1. Q2. Q3.

weight

confidence indicator for manufacturing industry

+ −

aggregation

Seasonal correction

weight

+ −

Seasonal correction

weight

+ −

International comparison

11

Balance (%)

Confidence indicator manufacturing industry November 2015*

*Large majority of data was taken before Paris terror attacks at 2015-11-13

-20 -15 -10 -5 0 5 10

Europe

Belgium

Germany

Greece

Netherlands

Hungary

France

Example: composite indicator

Producer confidence

12

Indicator Branch A

weight

…

aggregation

Producer confidence

Indicator Branch B

weight

Indicator Branch C

weight

Producer confidence as leading indicator

– Producer Confidence vs GDP

13

-30

-25

-20

-15

-10

-5

0

5

10

15

20

-6

-5

-4

-3

-2

-1

0

1

2

3

4

IV I II III IV I II III IV I II III IV I II III IV I II III IV I II III IV I II III IV

'08 2009 2010 2011 2012 2013 2014 2015

Pro

du

cer

con

fid

en

ce (

%)

% g

row

th

GDP y-on-y GDP q-on-q producer confidence

Leading indicator: Vacancies

14

-1.2

-0.9

-0.6

-0.3

0.0

0.3

0.6

0.9

1.2

-10

-8

-6

-4

-2

0

2

4

6

8

10

I II III IV I II III IV I II III IV I II III IV I II III IV

2011 2012 2013 2014 2015

Va

can

cy in

dic

ato

r (%

)

% g

row

th

Growth of vacancies q-on-q Vacancy indicator

Q. How do you expect your firm’s total employment to change over the next 3 months?

10

-30

20

40

0

30

-40

-20

-10

Future planning

15

• New temporal questions

- R&D

- innovation

• Adjust derived indicators completely to DG ECFIN definitions

- Economic sentiment indicator = producer confidence

- Business climate indicator

• Further refinement aggregation (district level)

• Publish statistical uncertainties

- include uncertainty seasonal correction bootstrapping

Conclusions

• Statistics Netherlands is the main executor of producing

statistics of the Dutch economic climate.

• Confidence and vacancy indicators can be used as leading

indicators.

• Future: further harmonization

16

Dutch business survey

17

Panel Observation period

branch Number of strata

Sample size

Month panel First 3 weeks of month

Industry Services Manufacturing

191 4.500

Quarter panel First 6 weeks of quarter

All commercial business companies

235 6.000

Year panel First 6 weeks of 4th quarter

All commercial business companies

132 20.000