Index of Production, UK: March 2020

• Production output fell by 4.2% between February 2020 and March 2020, with manufacturing providing the largest downward contribution, falling by 4.6%; there were also falls from mining and quarrying (11.5%), electricity and gas (1.5%) and water and waste (0.5%).

• The monthly decrease of 4.6% in manufacturing output was led by transport equipment, which fell by 20.5%, with the motor vehicles, trailers and semi-trailers industry falling by a record 34.3%; of the 13 subsectors, 10 displayed downward contributions, indicating that overall weakness was widespread.

• Total production output decreased by 2.1% for Quarter 1 (Jan to Mar) 2020, compared with Quarter 4 (Oct to Dec) 2019; this was led by manufacturing output, which fell by 1.7%.

• The quarterly fall in manufacturing is because of widespread weakness, with 9 of the 13 subsectors providing downward contributions; this was led by transport equipment which fell by 9.9%.

• For Quarter 1 2020, production output decreased by 4.9%, compared with Quarter 1 2019; this was led by a fall in manufacturing of 6.0% where 12 of the 13 subsectors displayed downward contributions.

• The coronavirus (COVID-19) had a strong negative impact on our estimates of monthly, three monthly and three monthly on a year ago growth for March 2020; For further and detailed analysis of the effect on our monthly index of production estimate, please see our article Coronavirus and the impact on output in the UK economy: March 2020, published today (13 May 2020).

We have changed the format for the Index of Services and the Index of Production statistical bulletins.

Monthly, three monthly and quarterly growth rates will be discussed in detail in GDP monthly estimate, UK: March 2020. In fulfilment of the commitment made in Meeting the challenge of measuring the economy through the COVID-19 Pandemic, we have published an article on Coronavirus and the impact on output in the UK economy, UK: March 2020, which will discuss monthly movements in output in services, production and construction.

Please see COVID-19 and the production of statistics for further information on how the Office for National Statistics (ONS) is working to ensure that the UK has the vital information needed to respond to the impact of the coronavirus (COVID-19) pandemic on our economy and society.

Index number

The index number is a measure of the average level of prices, quantities or other measurable characteristics relative to their level for a defined time period or location.

Industrial classification or breakdown

The industrial classification or breakdown is the internationally standardised method for classifying the wide range of industrial sectors in an economy. We use the Standard Industrial Classification 2007 (SIC 2007) for industrial breakdowns.

Manufacturing

The manufacturing sector includes the output of manufacturing industries and is broken down into 13 subsectors.

Monthly Business Survey

The Monthly Business Survey (MBS) collects information on the monthly turnover of UK businesses within the production and services sectors from various industrial sectors and regions in the UK.

Production

The production sector includes the output in the manufacturing (the largest component of production), mining and quarrying, energy supply, and water supply and waste management industries.

Turnover

The turnover of a company is the value of the goods or services sold during a particular time period. It includes total takings or invoiced sales and receipts. Interest and similar income, other operating income, and extra ordinary income is excluded. Value Added Tax (VAT) invoiced to the customer is excluded.

The Index of Production (IoP) uses data from a variety of sources and is calculated by taking turnover and removing the impact of price changes or by using direct volume estimates.

The majority of these data are collected as “turnover values” through the Monthly Business Survey (MBS). In addition, direct volume series are collected by the Department for Business, Energy and Industrial Strategy (BEIS) and the International Steel Statistics Bureau (ISSB) for steel industries.

From January 2018, Value Added Tax (VAT) data have also been included across 64 production industries for small and medium-sized businesses. For more information, see VAT turnover data in national accounts: background and methodology.

A comprehensive list of the IoP source data can be found in the Gross domestic product (GDP(O)) source catalogue (XLS, 715KB).

More quality and methodology information on strengths, limitations, appropriate uses, and how the data were created is available in the UK IoP QMI.

After EU withdrawal

As the UK leaves the EU, it is important that our statistics continue to be of high quality and are internationally comparable. During the transition period, those UK statistics that align with EU practice and rules will continue to do so in the same way as before 31 January 2020.

After the transition period, we will continue to produce our national accounts statistics in line with the UK Statistics Authority’s Code of Practice for Statistics and in accordance with internationally agreed statistical guidance and standards.

The Withdrawal Agreement outlines a need for UK Gross National Income (a fundamental component of the national accounts, which includes gross domestic product (GDP)) statistics to remain in line with those of other EU countries until the EU budgets are finalised for the years in which we were a member. To ensure comparability during this cycle, the national accounts will continue to be produced according to European System of Accounts (ESA) 2010 definitions and standards.

Coronavirus (COVID-19)

The Office for National Statistics’ (ONS’) Monthly Business Survey (MBS) is fully online, meaning that business owners can logon from any location and submit their data at an appropriate time. Most other data in the IoP come from the BEIS and therefore will be less impacted than survey data.

Our latest data and analysis on the impact of the coronavirus (COVID-19) on the UK economy and population is now available on a new webpage. This will be the hub for all special COVID-19-related publications, including the fortnightly Business Impact on Coronavirus (COVID-19) Survey (BICS).

The ONS has released a public statement on COVID-19 and the production of statistics. Specific queries must be directed to the Media Relations Office.

Seasonal adjustment

The data published in the Index of Production (IoP) release are all seasonally adjusted (although non-seasonally adjusted estimates are also available). This aids interpretation by removing annually recurring fluctuations, for example, those caused by holidays or other seasonal patterns.

Data volatility

Care should be taken when using the month-on-month growth rates as data can be volatile. Longer-term growth rates and examination of the time series allow for better interpretation of the statistics.

Comparability with UK trade statistics

The Monthly Business Survey (MBS) turnover in production industries dataset produces the proportion of turnover from exports by industry and level of turnover and exports (British pounds, millions). However, this is not always comparable with UK trade statistics. Further information on UK trade and how data on it are compiled can be found in the UK trade release.