1. Measuring the Impact of Business Profiling in the UK Wiesbaden Group on Business Registers Profiling (Costs and Benefits) Tallinn, Estonia, September 2010
Andrew Sage
Business Profiling Team
Office for National Statistics (UK)

2. The IDBR - What is it? The IDBR (Inter Departmental Business Register)
Statistical business register
Complies with EU standards
2.1 million enterprises (businesses)
2.5 million local units (sites)
Covers 98-99% of UK economic activity

3. IDBR Administrative Sources
HM Revenue and Customs
VAT traders
Intrastat traders (identified by VAT reference)
PAYE employers
Companies House
Company registrations
Dun and Bradstreet (D & B)
Worldbase linkages
ONS and Northern Ireland surveys
Defra farms statistics system

4. IDBR Units Model

5. What is Profiling?
Profiling is a method for analysing the legal, operational and accounting structure of an enterprise group at national and world level in order to establish the statistical units within that group and their relationships, and to create and maintain the most efficient structures for the collection of statistical data.

6. Experience of Profiling
UK has many years experience of profiling:
1984 – move suggested from establishment (local unit) to legal unit reporting
1987 – review indicated that legal unit reporting was not suitable for complex businesses – profiling of private sector started
2004 – comprehensive surveying of public sector starts following review of economic statistics
ONS has retained a profiling team since 1987.

7. Why do we need to profile in the UK?
Business Profiling
Why do we need to profile in the UK?
Need to meet statutory requirements for data collection (Statistics of Trade Act 1947)
Need to deal with businesses that are unwilling or unable to complete our forms
Requirement to update business register structures on which to draw survey samples.
Profiling minimises the risk of duplication or omission.
Meets need for a common approach to data collection across the whole economy - ensures consistency of outputs.
Produce a structure satisfying each of the employment, accounting and financial surveys

8. Criteria & Coverage of Business Profiling in the UK
Private sector enterprise groups with 250+ persons employment with secondary activity of 125+ persons employment.
Local Authorities with 3,000+ employment.
Central Government with 5,000+ employment.
Referrals because of survey response problems, often through mergers and takeovers.
Approx 2,500 cases fall within the criteria, all profiled within a 4 year rolling programme.

9. Summary of Business Profiling in the UK - 2009
Business Status
Business Employment
No. of Profiles in Existing Criteria
Monthly Profiling Target
Total No. of Profiles Over a 4-Year Rolling Program Cycle
Private Sector & Public Corporations (1,4,7)
1,097 29
1,392
2,000+
953 7
336
Central Government (5)
5,000+
104 2 96
Local Authority (6)
3,000-9,999
138 4
192
10,000+ 92
Totals
2,384

10. Measuring the Impact of Business Profiling in the UK – How did we measure its usefulness?
Approached UK Methodology Directorate who allocated a resource to investigate the following questions:-
How much does employment & turnover change month by month on the IDBR?
How much does profiling change business employment & turnover?
How would the IDBR look if profiling never happened?
What changes on the IDBR are attributable to profiling?
What is the effect of profiling at NACE 2-digit level?
Is there a relationship between the size of a business and the changes in employment and turnover in the IDBR?
Is there a relationship between survey response and business profiling?

11. Accumulative month on month change
Findings of Methodology Directorate – Measuring the Impact of Business Profiling in the UK (1) - Employment
Period: Jan 2008 to Jan 2009
Key
IDBR
IDBR - Profiling
Month on month change
Accumulative month on month change

12. Measuring the Impact of Business Profiling in the UK (2) - Turnover
Period: Jan 2008 to Jan 2009
Key
IDBR
IDBR - Profiling
Month on month change
Accumulative month on month change

13. Measuring the Impact of Business Profiling in the UK (3)

14. Measuring the Impact of Business Profiling in the UK (4)
Main singular reasons for greater than 2% changes in employment and turnover at NACE 2-digit level:
Division
Month
Reason
Abs. Change in Employment due to profiling (%)
Abs. change in Turnover due to profiling (%) 11
Jan 2009
Reclassification of business from division 31
89.5
86.9 40
Oct2008
Change due to the movement of employment and turnover to division 45
98.6
95.7 41
Dec 2008
Reclassification of business to division 45 with movement of 320 employment
92.7
95.2 42
Jun 2008
Gain of a reporting unit with 931 employment and turnover
100.0 60
May 2008
Restructuring.
51.1
65.1

15. Measuring the Impact of Business Profiling in the UK (5)
Average absolute contribution to the monthly IDBR change in employment & turnover (%) over a six month period
Employment
Group
No. of
Businesses
Contribution to the Monthly Change
in Employment (%)
Business/
Employment Ratio
in Turnover (%)
Turnover Ratio
All
100
10000+
1274
1131
2326
<250
Results for profiled businesses shows the same distribution.
On a per business basis, those with greater than contribute the
most.

16. Measuring the Impact of Business Profiling in the UK (6)
Response rates of the profiled businesses increased in the six months following profiling
Trend also apparent when examining the change in response rates on a monthly basis

17. Measuring the Impact of Business Profiling in the UK (7) - Conclusions
Profiling can be a significant contributor to these changes (>25% in one case)
Effect of profiling (measured by changes) much more apparent at NACE 2-digit level. Without profiling a >2% divergence in employment/turnover would have occurred in a number of divisions
Most large changes due to the profiling of individual businesses
Program developed to analyse absolute and overall changes due to profiling – IDBR & NACE 2-digits
Businesses with >10000 employment contribute the most to changes in the IDBR on an individual basis
Research supports targeting strategy brought in 2009 (0.6% of businesses by employment)

18. Business Profiling – Comparisons with other countries
Obtained copy of Netherlands (CBS) algorithm
Approached UK Methodology Division to carry out comparisons
Outcome – both approaches very similar however CBS alogorithm uses more variables
Conclusion – continue with UK approach

19. Measuring the Impact of Business Profiling in the UK (9)
ANY QUESTIONS
Andrew Sage
Business Profiling Team
Office for National Statistics (UK)