Farm Incomes Down By 13%

Defra released the second estimate of the total income from farming (TIFF) statistics for 2012 recently and the figures suggest that farm incomes fell by 13% (£721m) between 2011 and 2012 to £4,810m (real terms after allowing for inflation). RPI inflation increased by 3.2% during 2012.

Two main factors were given for the fall in total income and they were the weather and the resulting increased cost values; and a fall in the value of direct payments to farmers due to adverse changes in the Pound/Euro exchange rate. Poor weather affected the volume and quality of the harvest and increased the value of inputs used.

The income of farmers per annual work unit (AWU) was estimated to have fallen by 14% in real terms to £24,570 in 2012.

Gross output at basic prices at November 2013 was £24,089m and total intermediate consumption was £15,464m. There was a small decrease in Gross Value Added (GVA) of £51m to £8,625m because the increase in the value of intermediate consumption (goods and services used in production) was greater that the increase in the value of output.

Longer term trends show that total income from farming has remained at a higher level than the late 1990s and early 2000s but below a peak in the mid-1990s. Entrepreneurial labour income has performed better than TIFF mainly due to a decrease in the number of farmers and other unpaid workers.

Fall In Productivity In Q4 2012

Labour productivity on an output per hour basis fell by 0.5% in Q4 of 2012 and by 0.8% in manufacturing. Output per hour fell by 0.5% in the services sector. Market sector productivity fell by 0.6%, its lowest level since 2005.

Labour costs increased by 0.5% in Q4 2012, 1.8% higher than 2011. Labour costs in manufacturing increased by 1.7%, 7.4% higher than 2011.

Gross value added (GVA) fell by 0.3% while the number of workers increased by 0.6%, jobs increased by 0.5% and hours by 0.3%. Falling output with rising workers, jobs and hours suggests output per worker and output per job fell by 0.8% and output per hour fell by 0.5% (labour productivity is also calculable as growth of GVA minus growth of labour input).

Some people have more than one job which results in small differences between growth of output per worker and growth of output per job.

Total Income From Farming Up Across The Country

The second estimate of agriculture in the English regions from Defra suggests that total income from all farming increased significantly in all NUTS1 regions in 2011. The North East had the largest increase with 38% and the East Midlands had the next largest increase with 33% on 2010. The smallest increases were in the North West and the West Midlands with a 20% increase in each.

Total income from farming has increased in all NUTS1 regions, in the medium term, between 2005 and 2011. The South East has seen increases of 364 to 464 and the North East 191 to 291. The smallest increases were in the East of England (224%) and the West Midlands (225%).

The relative importance of agriculture to each region can be seen in its share of regional gross value added (GVA) and the regional workforce. The greatest contribution to GVA in 2011 was made in the South West with 1.3% and the least in the South East with 0.19%. In England as a whole agriculture contributed 0.64% to GVA.

Agriculture made its greatest contribution to the regional workforce in the South West with 2.22% and the least in the South East with 0.5%. The industry contributed 1.1% to the workforce in England as a whole.

Creative Industries Statistics

The creative industries contribution to the economy accounted for 2.89% of Gross Value Added (GVA) in 2009 an increase of 0.07% on 2008 in relative terms but in absolute terms GVA decreased by 1% from £36.6bn to £36.3bn. The biggest contribution to UK GVA from the creative industries came from publishing with 0.92%, then advertising with 0.55% and TV and radio with 0.38% (figures from the Department for Culture, Media and Sport (DCMS)). The sector accounted for 10.6% of UK exports in 2009 of which publishing and TV and radio accounted for the greatest exports of services with 3.1% and 2.6% respectively. There were 106,700 creative businesses in the UK in 2011, up to 5.1% from 4.9% in 2009 and 108,820 creative local units, an increase from 4.2% in 2009 to 4.3%. The biggest contribution to the number of businesses came from music and visual performing arts with 30,460 or 1.46% of enterprises and 1.21% of local units in 2011. Advertising accounted for 16,101 businesses or 0.77% of UK total and design 14,720 or 0.71%. Creative businesses employed 1.5m people directly or in a creative role in another industry. It amounts to 5.14% of UK employment. It is a small increase on 2008 when the number was 1.44m or 4.99% of UK employment. The music and visual and performing arts were the largest employers in the creative industries sector with 300,000 employees in 2009 or 1% of UK employment. Next came advertising with 0.92% of employment and 268254 people employed, then publishing with 0.84% and 243,809 people.

GVA Fall In All Regions 2009

Gross Value Added (GVA) GVA and GVA per head fell in all regions of the UK in 2009 due to the impact of the recession. There was still a wide variation in the extent of the effect. The East of England had the biggest fall. Scotland had the smallest decline. London had the highest share of GVA in the UK with 21.5% and the South East was next with 14.3%. The North East had the lowest share in England with 3.3%. England had 85.8% of GVA and N. Ireland 2.3% (of the 12 NUTS1 Levels).

At the level of the 37 NUTS2 sub-regions, the top five included Inner London and North East Scotland the bottom five included West Wales and the Valleys, Cornwall and the Isles of Scilly, Lincolnshire and Tees Valley and Durham. London had the biggest share of GVA per head with £60,686 the lowest was West Wales and the Valleys with £12,860. GVA per head increased in all NUTS2 sub-regions in 2008.

Breaking the statistics down to the 133 NUTS3 local areas level the top area was Inner London West the bottom area the Isle of Anglesey. The City of Edinburgh was second highest and then Inner London East.

Annual Business Survey 2009

Provisional results for the annual business inquiry now called the annual business survey show decreases in all four main industry groups: production, construction, distribution and services in turnover, purchases and gross value added (GVA) at basic prices. Agriculture also reported decreases in turnover, purchases and GVA at basic prices.

Production decreased 8.1% in turnover, 8.9% in purchases and 10.2% in GVA. Within the production group mining and quarrying fell by 24.6% in turnover and 37.5% in GVA. Production did report some increases most notably in electricity, gas, steam and air conditioning with 8.4% in turnover and 32.1% in GVA. Manufacturing reported decreases of 9.1% in turnover, 10.9% in purchases and 11.2% in GVA. The construction industries reported the largest percentage falls with -13.7% in turnover, -15.1% in purchases and -20.3% in GVA.

Distribution reported the largest decreases in money terms with a decrease of £60bn in turnover (-4.9%), £58bn (-5.5%) in purchases and £17bn (-4.6%) in GVA. While the financial differences were the largest the percentage changes were not. Only services had a smaller percentage change. The only increases in the distribution industries was in retail (except motor vehicles and motorcycles) increasing turnover by 0.3% and GVA by 1.8%.

First Annual Business Enquiry Using SIC 2007

The ONS published their first set of provisional results for the Annual Business Enquiry under the new Standard Industrial Classification (SIC) 2007. The differences between the SIC 2003 and SIC 2007 make it difficult to compare the 2008 figures with previous years. Results for the four main industry groups - production, construction, distribution and services, were given in terms of turnover, purchases and Gross Value Added (GVA).

The production industries provisionally look to have an 8.7% change in turnover, 10.3% in purchases and an approximate 6.6% increase in GVA between 2007 and 2008. Construction has also increased its results. Its turnover has gone up by 8.4%, its purchases by 6% and approximate GVA by 11.6%. The distribution industries' turnover went up by 16.9%, purchases by 19.8% giving an overall decrease in GVA of -1%. Services' turnover increased by 8.3%, purchases by 10.6% and approximate GVA of 5.5%.

The mining industries contributed largely to production figures as did electricity and gas adding 30.3 and 21.4 respectively in turnover. Wholesale trade made a large contribution to the distribution figures. The only decreases in the service industries were arts, entertainment and recreation and administrative and support services with -24.3 and -5.1 respectively.

Computers Lead Decline In Business Services Output

The ONS Index of Services for the quarter to June shows that the index for output (seasonally-adjusted chained volume of gross value added or GVA) fell by 0.6% compared with the previous quarter. Taking the index back to April it increased by 0.2%. The index comprises five components: distribution, hotels and restaurants, transport and communication, business services and finance and government and other services.

In the quarter to June the only increase was in hotels and restaurants at 0.8%. In the latest month the greatest increase was in distribution. There was a decrease of 0.8% in business services and finance. The most significant decreases were in computer services and other business services.

Services accounted for over 76% of gross domestic GDP in 2005. The data for the index are consistent with the quarterly OIE data from earlier releases on GDP in August 2009.

GDP Down 1.9%

Preliminary estimates of GDP for the first quarter of 2009 from the Office for National Statistics on GDP by gross value added (GVA) suggest a decline of 1.9% on the last quarter compared with 1.6% the previous quarter. They also suggest it was 4.1% lower than 2008. The index for GDP at market prices was 108.1 and has been in decline for 5 successive quarters.

Production which represents about 18% of the UK economy was down 5.5%, a negative acceleration on 4.5%, driven by manufacturing. Agriculture, which now represents only 1% of the economy, actually grew by 0.3% in Q1 2009. It may only reflect the early estimated output from agriculture from DEFRA. Services, representing 75% of the UK economy, reported a fall of 1.2% drove the decline along with production and construction. It compares with a decline of 0.8% in the previous quarter. Of the total, distribution, hotels and restaurants (15% of the economy) also increased by 1.2% thanks mostly to wholesale and motor trades. Business services and finance, which represents about 30% of the economy, declined by 1.8% in Q1 2009. Five of the eight components of the category declined with 'other business services' (10% of GDP) making the biggest contribution. Government services increased by 0.5% on the quarter and 1% on the year.

The Quarterly National Accounts for Q1 2009 show a fall of 2.4% on the previous quarter revised down from 1.9%. It is 4.9% lower than Q1 2008. The index was 110.9 for GDP at market prices and 101.9 for chained volume measures. The household saving ration was 3% compared with 4% in previous quarter. Real household disposable income fell by 2.4% following a 2.4% rise last year. Household final consumption fell by 1.3% compared to a 1.1% fall in the previous quarter. The volume of spending is 3.1% lower than at the same time in 2008. Both government and households were net borrowers. Financial corporations, private non-financial corporations and public corporations were among the net lenders.