1 OECD National Accounts WP October 2004 ISIC Revision 4: Top-top Structure for reporting data by activity: What are national accounting needs in revision of ISIC (and CPC)? William Cave OECD Statistics Directorate

2 OECD National Accounts WP October 2004 ISIC rev 4: A Top-top Structure? What are OECD needs? Eurostat proposal for an aggregation structure of revised ISIC and NACE for reporting of national accounts data by activity need for new high-level data reporting structure for OECD national accounts community need to revise A6/A17/A31/A60 agggregations What are SNA needs for revision of the Central Product Classification (CPC)?

3 OECD National Accounts WP October 2004 What is ISIC? International Standard Industrial Classification of All Economic Activities (ISIC) One of UN family of international reference statistical classifications The official activity classification of SNA Original ISIC 1948 Rev , Rev , Rev Minor Revision , Revision 4 planned for 2007 To be standard classification of productive economic activities To classify economic entities (units) according to activity they carry out

4 OECD National Accounts WP October 2004 What is CPC? CPC developed in 1980s and 90s principally to provide the first internationally agreed product list for goods and services. For goods less detailed than trade products in Harmonised System Used indirectly to help build economic statistics on output, prices and trade Currently on CPC version 1.1 agreed in 2002 Plan to revise CPC for 2007 Proposals sought by UNSD for 10 October

5 OECD National Accounts WP October 2004 Design principles & priorities for ISIC rev 4 Improve international comparability –convergence of regional classifications –E.g. NAICS/NACE/JSIC/ANZSIC –engage more countries and regions in ISIC design –target for international comparability at least at 2 digit level Relevance –Information sector, internet Telecoms –OECD ICT definition –environmental services –new technologies –growing business service sector –health services –Agriculture Continuity Level of detail for an international classification?

6 OECD National Accounts WP October 2004 ISIC 3 and ISIC 4 top-level ISIC 3 has 17 tabulation categories (sections) ISIC 4 proposes 21 sections ISIC 3 has 60 two digit divisions ISIC 4 proposes 87 two digit divisions UNSC agreed that target level for international comparability is (at least) two digit level

7 OECD National Accounts WP October 2004 ISIC rev 3 Structure

8 OECD National Accounts WP October 2004 ISIC Rev 4 Draft

9 OECD National Accounts WP October 2004 Whats new? New groupings –Information and communication sector –water supply, sewerage, waste management and remediation More tabulation categories for services –professional technical, and business services –administrative and support services –real estate, rental and leasing services –art, entertainment and recreation More divisions ( to increase international comparability) –for new groupings and growing services –in manufacturing and construction –all the above –human health services

10 OECD National Accounts WP October 2004 The ISIC revision mechanism and process The revision is ultimately controlled by UN Statistics Commission = (Heads of National Statistics Offices) Directed by UN Expert Group on Economic and Social Classifications = (experts from about 30 countries and international organisations) Work done by Technical Sub-group of Expert Group = (8-10 countries plus international orgns)

11 OECD National Accounts WP October 2004 ISIC Revision Process approximate timetable Worldwide consultation closes November 2004 TSG meet Spring 2005 Revised draft goes to UN Expert Group June 2005 Final draft goes to UNSC December 2005 for approval Prepare full publication Publish early 2007

12 OECD National Accounts WP October 2004 NAICS minor revision 2007 NACE plans to revise in derived from ISIC ANZSIC 06- related to NAICS JSIC introduced IC sector in 2002 converged with ISIC and NAICS but constrained by ministries- –expect convergence to continue after next revision Others? China, India, Mercosur, Russia Regional Classifications?

13 OECD National Accounts WP October 2004 What are OECDs current set of ISIC 3 NA data aggregations? A6 A17 = ISIC rev 3 Sections A31 = ISIC rev 3 Sections + 15 manufacturing sub-sections A60 = ISIC two digit divisions

14 OECD National Accounts WP October 2004 Top-top structure for ISIC Eurostat proposal National accounts needs fewer than 21 categories for reporting summary data by activity Eurostat propose: – A6 becomes A9 –A60 becomes A65 (not A87) Suggests a reordering of ISIC with Public Administration moving up

15 OECD National Accounts WP October 2004 A6==>>A9? The A6 structure for ISIC rev 3 Proposed Top-top A9 breakdown new ISIC rev 4 sections AB1. Agriculture, hunting, forestry and fishingA CDE2. Industry including energy 2. Industry, including energy & waste management B, C, D and E F3. ConstructionF GHI 4. Distributive trades, hotels and transport 4. Trade, transport, accommodation & food services G, H and J * JK 5. Financial, real estate and business services 5. Information and communication K 6. Financial and insuranceL 7. Real estate, rental and business activities M, N and O L to P6. Other services. 8. Public admin, education and health T **, P and Q 9. Other services activitiesR, S and U

16 OECD National Accounts WP October 2004 Questions for delegates Are Top-top A9 proposals suitable for data reporting in OECD & internationally? Are A65 proposals useful for OECD reporting? Should OECD or UN be proposing a set of data reporting aggregations? (A9/A21/A35/A87)? By when? Should CPC revision address supply-use needs?

17 OECD National Accounts WP October 2004 Thank you for your attention