This technical paper outlines a methodology for constructing estimates of the value-added from exports by 4-digit SIC sub-industries within the UK car manufacturing industry while further extending the analysis to all 4-digit SIC sub-industries belonging to the manufacturing sector. More specifically, our estimates provide a measure of the direct domestic value-added component of exports, i.e., the difference between the value of exports and the expenditure on intermediates used to produce the exported goods. Currently, published estimates on the value-added of UK trade are only available for the car industry as a whole. Our estimates are available at a yearly frequency from 2012-2015.
This methodology has been developed through collaboration between the Economic Statistics Centre of Excellence (ESCoE), the ONS and HMRC. The ESCoE aggregate estimates are constructed using individual business data held by HMRC. These methods enable the value-added and exporting profile of each firm to be considered and so better estimates to be constructed than would have been the case if only aggregated data was used.
ESCoE estimates suggest that at least that £3.93bn of UK car industry exports was value-added generated directly by the firms immediately prior before exporting. The 4 sub-industries comprising the UK car industry we analyse differ substantially in terms of their import and export intensities and our study provides a detailed picture of direct domestic value-added and direct domestic value-added content of exports from such subindustries. Furthermore, we also provides a way of measuring direct imports and exports, both within and outside the EU28, for subindustries belonging to the car industry thus allowing to gain better insights into the importance of global value chains for specific subindustries. Finally, we extend the above methodology and analysis to all 4-digit SIC sub-industries belonging to manufacturing sector while providing detailed results.
These estimates form part of a wider project conducted by ESCoE, whose aim is to construct more highly disaggregated measures of value-added from trade for key sectors.