Global value chains and outsourcing

Global value chains

Global value chains are processes for production of goods and services that take place in several countries. Enterprises increasingly organize their production globally, breaking up their value chains into smaller parts supplied by a growing number of providers located worldwide. Outsourcing of business functions is a key feature of global value chains (GVCs) as European businesses increasingly globalize their production processes (Eurostat).

Outsourcing

Full or partial transfer of business functions (core or support functions) which are currently carried out in Norway, to enterprises within or outside the enterprise group located abroad.

Backsourcing

Full or partial transfer of business functions (core or support functions) which are currently carried out within or outside the enterprise group abroad, to Norway.

Import

Expenses for purchases from foreign suppliers. The country of import is the country of registration of the foreign supplier.

Export

Revenues from sales to foreign customers. The country of export is the country of registration of the foreign customer.

Concern

In this survey, we mean enterprises that are related to each other, such as parent company, subsidiary, sister company, and daughter company, etc.

• The parent company is a company that, directly or indirectly, has control over the other entities in the group.
• Subsidiary is a company in which the parent company has direct control.
• A daughter company is a company in which a subsidiary has direct control, while the parent company has indirect control.
• By control, we mean more than 50 per cent ownership interest in another company.

The use of common standards is important in economic statistics as this makes it possible to compare and analyze statistical data across national borders and over time.

Standard Industrial Classification

The statistics are published according to the Standard Industrial Classification 2007 (SIC2007). SIC2007 complies with the EU standard, NACE Rev. 2. SN2007 forms the basis for the classification of units by most important activity in the Central Register of Establishments and Enterprises (CRE).

Country

Follows the international standard ISO-3166-1 alfa-2. The codes are defined in Statistics Norway's Classification of country codes.

Name: Global value chains and outsourcing

Topic: External economy

Division for External Trade Statistics

The statistics show the relocation of business functions abroad by Norwegian enterprises and participation in global value chains on a national level.

The statistics is published every three years, with a reference period of the three previous years.

The statistics is part of a joint European survey and is reported to Eurostat. The statistics are one of the development areas under the National Programme for Official Statistics, section 6.18. Balance of payments. The statistics is covered by Regulation (EU) 2019/2152 of the European Parliament and of the Council of 27 November 2019 on European Business Statistics (EBS Regulation).

Collected and revised data are stored securely by Statistics Norway in compliance with applicable legislation on data processing.

Statistics Norway can grant access to the source data (de-identified or anonymised microdata) on which the statistics are based, for researchers and public authorities for the purposes of preparing statistical results and analyses. Access can be granted upon application and subject to conditions. Refer to the details about this at Access to data from Statistics Norway.

The purpose of the statistics Global value chains and outsourcing is to investigate how economic globalization affects Norwegian enterprises. This is done by mapping Norwegian enterprises' relocation of business functions (core and support functions) from Norway to abroad (outsourcing), as well as mapping the movement of business functions from abroad to Norway (backsourcing).

We investigate how this affects jobs in Norway, and the opportunities to create new jobs. The survey also looks at the motivations and barriers for both outsourcing and backsourcing business activities.

Furthermore, the survey maps Norwegian enterprises' participation in global value chains regarding imports and exports of both goods and services.

The survey is part of a joint European survey and is partly funded by Eurostat. The statistics have previously been collected for the periods 2001−2006, 2009−2011 and 2014-2016.

The statistics is an important part of the basis for forecasting and analysis work carried out by organizations, public authorities, research institutions and others. International organizations, such as the UN Statistical Office, the EU Statistical Office (Eurostat) and others, make use of the information provided by the statistics. The statistics can also be used by the business sector as a source of data for planning production, marketing, and sales.

No external users have access to statistics before they are released at 8 a.m. on ssb.no after at least three months' advance notice in the release calendar. This is one of the most important principles in Statistics Norway for ensuring the equal treatment of users.

The statistics Global value chains and outsourcing is part of a joint European survey, partly funded by Eurostat. Read more about the survey on Eurostat's website here.

The statistics are developed, produced and disseminated pursuant to Act no. 32 of 21 June 2019 relating to official statistics and Statistics Norway (the Statistics Act).

The statistics are part of the national program for official statistics 2024-2027, main area International economic relationships, sub-area Economic globalisation.

The statistics is covered by Regulation (EU) 2019/2152 of the European Parliament and of the Council of 27 November 2019 on European Business Statistics (EBS Regulation).

The statistics Global value chains and outsourcing is based on a population consisting of enterprises in industries B to N:

• B – Mining and quarrying
• C – Manufacturing
• D – Electricity, gas, steam and air conditioning supply
• E – Water supply; sewerage, waste management and remediation activities
• F – Construction
• G – Wholesale and retail trade; repair of motor vehicles and motorcycles
• H – Transportation and storage
• I – Accommodation and food service activities
• J – Information and communication
• K – Financial and insurance activities
• L – Real estate activities
• M – Professional, scientific and technical services
• N – Administrative and support service activities

The sample is limited to enterprises with 50 or more employees and consists of approximately 2 000 legal entities.

The survey is divided into seven modules:

• number of employees in the enterprise distributed by business functions
• the enterprise's group affiliation
• global value chains export
• global value chains import
• cross-border relocation of business functions (outsourcing and backsourcing)
• motivations and barriers related to outsourcing
• the effects of COVID-19

Data is collected every three years and are part of a joint European survey, partly funded by Eurostat.

The statistics Global value chains and outsourcing is based on enterprises in industries B to N, limited to a sample of enterprises with 50 or more employees. The sample is drawn from the Central Register of Establishments and Enterprises (CRE). CRE is Statistics Norway's central register of all legal entities and enterprises in the private and public sectors in Norway.

The specific population used for sampling for each survey is made based on situational withdrawals from the Central Register of Establishments and Enterprises prior to the completion of the surveys. The population consists of approximately 3 800 enterprises.

Furthermore, the selection is determined based on a stratified selection. The strata are defined based on industry classification, broken down by analytical areas and two different employee groups.

The analytical areas are specified by Eurostat and distinguish high-to-medium-high technological industrial production and knowledge-intensive service industries as separate groups. Industries affected by this are industries C, H, M and N.

Furthermore, the employee groups are given by:

1. 50-149 employees
2. 150 or more employees

The sample of 2 000 legal entities is divided into full census enterprises and randomly drawn enterprises. We use optimal allocation to distribute the sample between analytical areas and employee groups. The allocation is made optimally in relation to the number of enterprises that have outsourcing. This means that the sample is distributed between the strata so that the variance of the estimator is as small as possible. The estimator is the stratified expansion estimator, i.e. simple inflation of the sample means per stratum.

Collection of data

Data is collected by electronic reporting. The respondents receive a survey for reporting every three years, with a reference period of the three previous years.

Editing

Editing is defined here as checking, examining and amending data. Important sources for this work are the annual balance sheet, the Register of Establishments and Enterprises (VoF) and information from the enterprises themselves.

Estimations

The statistic Global value chains and outsourcing is based on a sample survey, and values are estimated using a stratified expansion estimator. This estimator is made in the following way:

1. Within each stratum, average reported values are calculated based on the sample.
2. Because the sample is drawn stratified at random, these averages are good estimates of the actual averages in the various strata. Any extreme observations are kept out of the calculation of averages.
3. Within each stratum, the calculated averages are multiplied by the number of enterprises in the stratum (in the delimited population). This will be an estimate of the total value in the stratum.
4. The largest enterprises are always included, and we define these as fully counted enterprises. In this survey, all enterprises with 150 or more employees are full-count enterprises. These are not used as a basis for estimation and should therefore not represent other enterprises in the limited population. These enterprises enter the total only with their own value.

Data is not seasonally adjusted.

Employees of Statistics Norway have a duty of confidentiality.

Statistics Norway does not publish figures if there is a risk of the respondent’s contribution being identified. This means that, as a general rule, figures are not published if fewer than three units form the basis of a cell in a table or if the contribution of one or two respondents constitutes a very large part of the cell total.

Statistics Norway can make exceptions to the general rule if deemed necessary to meet the requirements of the EEA agreement, if the respondent is a public authority, if the respondent has consented to this, or when the information disclosed is openly accessible to the public.

More information can be found on Statistics Norway’s website under Methods in official statistics, in the ‘Confidentiality’ section.

The population for the 2018-2020 survey is based on units in industries B to N, and the survey included questions about COVID-19.

The population for the survey 2014-2016 is based on units in industries B to N, but not including industries K – Financial and insurance activities. The survey included questions about backsourcing.

The population in the survey consists of about 3 800 enterprises, where the sample consists of about 2 000 enterprises. A large sample relative to the population size results in lower uncertainty when estimating. Response rate to the survey is normally around 97 %. The results of a statistical survey may nevertheless contain measurement and processing errors, non-response errors and sampling errors.

Measurement errors occur when the respondent, due to obliviousness, misunderstanding of the question, errors in data of the respondent or the like, gives the wrong answer. A typical error may be the use of an incorrect scale, for example reporting in NOK instead of a thousand NOK.

Processing errors can be, for example, errors with encoding, or errors that occur during loading or editing.

By non-response error, we mean errors that are either due to unit non-response, i.e. the legal entity has failed to respond to the survey, or partial non-response, i.e. the entity has failed to answer at least one question in the survey. In such cases, it may be appropriate to impute missing values. This means that we use figures from other sources to replace the missing values.

Sampling error mean the uncertainty caused by the fact that the figures are produced based on a sample of units and not the entire population. In other words, sampling errors measure the expected discrepancy between the sample's results and what the results would have been if the entire population had been examined.

Revision is a planned change of figures that are already published (for example, publishing final figures after preliminary figures previously have been published). See also Statistics Norway's principles for auditing. No revision of previously published figures for Global value chains and outsourcing is planned.