Industry of the Czech Republic

Methodology

Contents

Part A

With effect since January 2006, the Czech Statistical Office changed the methodology of calculating the industrial production index (IPI) and converted the time series back to the year 2000 accordingly. The reason for the new alternative methodology of IPI calculation were major changes in the structure of industrial products and industrial services in manufacturing (section D), which did not allow industrial production indices of individual products and their aggregates to be fully used after 2005.

When calculating the IPI for manufacturing (except for subsection DF (division 23) – Coke, refined petroleum products and nuclear fuel), we use indices of sales from own industrial activity at constant prices by CZ-NACE 2-digit divisions. The sub-indices of sales from own industrial activity of enterprises classified by their principal activity into manufacturing at the level of CZ-NACE 2-digit divisions are then weighted by weights corresponding to the shares of these divisions in total value added produced in industry. The change in the methodology of calculation is a shift from the product method to the enterprise method. In the cases of section C – Products from mining and quarrying, sub-section DF, and section E – Electrical energy, gas, steam and water, the calculation is based on the weighted arithmetic mean of volume indices of production of selected representatives using a two-stage system of weighting.

The industrial production index is an indicator of monthly changes in “fixed“ value added, calculable for the total and for the breakdown into subsections (alphabetic codes). The fixed value added refers to the approximation of value added depending only on changes in the volume of production of selected products in the above-mentioned sections and subsection DF and composition of the total industrial production, but not on changes in prices and contents of value added in individual industrial products and in sales from own industrial activity of individual enterprises and their groupings into 2-digit divisions.

The monthly IPI is related to a single basis, average month of the base year 2000 (average month of 2000 = 100), from which monthly and cumulative year-on-year industrial production indices (IPIs) are derived. The calculated IPIs are aggregated by sections, subsections and divisions and by 5 Main Industrial Groupings (MIG) – energy, intermediate goods, capital goods, consumer durables and consumer non-durables.

The industrial production index is calculated using the results of statistical surveys taken in reporting units (enterprises) with principal industrial activity and with 20+ employees, irrespective of their legal form.


Part B

The other basic indicators of short-term statistics rest on monthly results of statistics on sales, number of employees, wages in enterprises with industry as their principal activity and employing 20 or more people, irrespective of the legal form. Enterprises with 100 employees or more are covered all to calculate basic indicators; a sample is used for enterprises with 20-99 employees and grossing up to the universe is made.

Sales of own goods and services in industry are measured at current prices and a composite price index is used to deflate them. The index comprises an industrial producer price index related to the domestic market and an export price index of manufactured goods broken down by CPA. From 1 January 2001, the composite price index (according to the Laspeyres formula) has been derived on the weighting scheme of 1999 related to average prices of 2000.

The average registered number of employees encompasses all categories of permanent, casual or temporary employees contracted to work for the enterprise.

The average monthly wage per employee includes all incomes from employment (direct wages, personal bonuses, gratuities, shares in economic results and remuneration for time not worked) accounted to registered employees in compliance with appropriate regulations on wages (this applies to gross wages).

From 1 January 2001, the labour productivity is calculated as the sales in industry index over the index of the average registered number of employees.


Part C

Job orders statistics is part of enterprise short-term statistics. This implies that all volumes of job orders concerning manufactured goods and services are measured as a total for an enterprise classified to its respective branch (CZ-NACE) according to its prevailing activity. Hence, the job orders are not measured or published broken down by individual manufactured goods or services, and their volumes can thus be related only to enterprise short-term statistics indicators – i.e. especially to revenues from sales of own manufactured goods and services.

The volume of job orders does not include job orders of goods purchased for resale in the same condition as received. The job orders are valued at agreed prices, free of VAT and consumer tax. The volumes of job orders are measured in enterprises of selected CZ-NACE divisions that mostly produce to order in a rather long production cycle and have a rather large supply of orders. They are mostly enterprises producing capital goods, intermediate goods and consumer durables.

In part C, there are published seasonally non-adjusted year-on-year, monthly and month-on-month indices of new job orders (current prices), along with indices of sales from own industrial activity for selected industrial groupings.


Part D

The method TRAMO / SEATS implemented in the DEMETRA programme is used for seasonal adjustment. This method belongs to the most preferred methods of EUROSTAT for seasonal adjustment of time series of economic indicators. The table lists month-on-month seasonally adjusted indices of hosen indicators.





From January 2001, the Czech Statistical Office calculates industrial production indices (IPI) and other indicators of short-term industry statistics, besides present aggregations, also in a newly implemented disaggregation by five Main Industrial Groupings (MIG). MIG are represented by the classification of industrial production by the main use of this production, i.e. by industrial production predominantly intended for Intermediate Goods (MIGIG), for Capital Goods (MIGCG), for Consumer Durables (MIGCD), for Consumer Non-Durables (MIGCND) and Energy (MIGE). The Main Industrial Groupings are defined using 3-digit groups of CZ-CPA or CZ-NACE and comply with Eurostat methodology of 2000.