Business tendency survey for manufacturing, mining and quarrying

Local unit (establishment) : An enterprise or part of an enterprise that is located in one particular place and can be identified geographically.

Enterprise : The smallest combination of legal units that is an organisational unit producing goods or services and that benefits from a certain degree of autonomy in decision making.

Branch unit : Unit, which comprises all establishments within an enterprise belonging to the same 3-digit industry group (SIC2007).

Altinn: digital government system for reporting data via the Internet.

NACE : Standard for industrial classification used by EUROSTAT based on the UN's international standard for industrial classification, ISIC Rev. 3.

Unadjusted figures : Raw data figures with primary information from the respondent.

Seasonally-adjusted figures : Time series for which calendar and seasonal effects have been removed. X12-ARIMA is used to calculate these figures.

Trend series : Time series for which calendar and seasonal effects together with the irregular component have been removed. The trend in a time series reflects the long-term tendency that influences the series and has a fairly smooth and monotonic character. The trend series are calculated in connection with the decomposition of the time series for the unadjusted figures in X12-ARIMA.

Response distribution : Employment weighted shares in percentages for valid response alternatives for a single question. For questions like «total level of production» the response alternatives are greater , unchanged and smaller respectively. The response distribution may be expressed in the following way:

(1) G + U + S = 100

where

G = Percentage that has replied: Greater

U = Percentage that has replied: Unchanged

S = Percentage that has replied: Smaller

Net figures : Defined as the difference between the percentage shares for the extreme response alternatives. For questions like «total level of production» the extreme response alternatives are greater and smaller respectively. The Net figure, N, is defined as:

(2) N = G - S

The net figure, as an indicator of the development in the variable, is often assigned turning point characteristics. A net figure greater then zero indicates that the growth rate of the variable is positive. A positive net figure, but reduced from one quarter to the next, indicates that the growth rate is still positive but reduced. The opposite applies for a negative net figure.

Diffusion index : Defined as the estimated positive percentages (greater) plus half of the neutral answers (unchanged). For questions like «total level of production» the diffusion index, D, is compiled as:

(3) D = G + 0.5 x U

The diffusion index has a simple intuitive approach as it compiles the respondents answering greater seen in association with half the share of respondents answering unchanged. The simplicity lies in the fact that the indicator builds on the assumption that half of the respondents answering unchanged in practice have experienced a growth in the variable, while the other half have experienced a decline. The diffusion index has 100 as the maximum value when all active respondents choose the response alternative greater. The minimum value is equal to 0 when all choose smaller. The index normally fluctuates around 50, which is also the turning point value. Below are some interpretations for the diffusion index as described in the literature:

• If the D value is greater than 50 it indicates that the growth rate of the variable is positive, and the opposite for a value below 50.
• If the D value rises from a level below to a level above 50, the growth rate of the variable has turned from negative to positive.
• If the D value is greater than 50 and increasing it indicates that the growth rate is increasing, while a falling index from above 50 indicates a falling rate of growth, but still positive. The opposite is the case for an index below 50.

Industrial Confidence Indicator (ICI) : The ICI is calculated on the basis of the net figures from three questions in the Business Tendency Survey:

• Actual development in total stock of orders compared with the previous quarter (X)
• Expected development in the level of production in the forthcoming quarter compared with the present quarter (Y)
• Assessment of stock of own products intended for sale (Z)

The ICI is the arithmetic average of the net figures (Z with inverted sign). Further, the trend is identified by the seasonal adjustment of the ICI. The Norwegian ICI is harmonised with the ICI defined by EUROSTAT, and the composition is described in detail in Economic Paper number 151, see DG ECFIN (2001). The ICI is supposed to be a leading indicator for the production in manufacturing industries whereby increases in production expectations indicate directly increases in the forthcoming level of output, increases in the total stock of orders indicate an increased level of production due to the fulfilment of the received orders, and finally, increases in stocks indicate slow sales and reduced activity.

(5) ICI = (X + Y - Z)/3

The survey is classified according to the Standard Industrial Classification 2007 (SIC2007). This is a Norwegian adaptation of Eurostat’s industry classification, NACE Rev. 2. SIC2007 forms the basis for classifying units according to principal activity in the Central Register of Establishments and Enterprises. The use of common standards is essential in order to enable the comparison and analysis of statistical data at an international level and over time.

The survey is also classified according to EUROSTAT's end-use categories (Main Industrial Groupings, MIG). The end-use categories (MIGs) are based on the 3-digit level industrial groupings in SIC2007. Five end-use categories are included in the survey:

The following table summarises the most important industries included in the different end-use categories:

For a complete description of industries covered in each MIG, see Commission regulation (EC) No 656/2007 .

The objective of this classification is to provide an activity breakdown of NACE, which is more detailed. The classification of the different units is based on the application of the produced products. It should be noted that the MIGs are not comparable in size, in particular the consumer durables heading is smaller than the others.