Consolidated supply, use and input-output tables
From Statistics Explained
In 2009, industrial products represent 28 % of the EU total output and 22 % in the US
Statistics in focus 24/2013; Author: Isabelle RÉMOND-TIEDREZ
ISSN:2314-9647 Catalogue number:KS-SF-13-024-EN-N
This article presents the latest available European consolidated supply, use and input-output tables for 2008 and 2009 in terms of the NACE Rev. 2, together with some practical and methodological background information. Alongside the tables for the European Union (EU) and the euro area (EA), US data have been compiled for 2008 and 2009 according to European activity and product classifications. The consolidated supply, use and input-output tables are used for macro-analysis of the European Union (EU) and euro area economies. The tables give an annual snapshot of overall production and the use of the products, distinguishing 64 NACE activities and 64 products from the CPA.
The data are broken down into 10 activity and 10 product groups.
- 1 Main statistical findings
- 1.1 Construction works dominate industrial output in Europe and US
- 1.2 Financial services and public administration output stronger in US than in EU
- 1.3 Different cost structures in EU and in US
- 1.4 Intermediate consumption
- 1.5 Impact of final demand on EU and US economies
- 1.6 Embodied employment in exports in EU and Euro area
- 1.7 Embodied labour income in exports down in 2009
- 1.8 Strong embodied labour income in export of real estate services
- 2 Data sources and availability
- 3 Context
- 4 Further Eurostat information
Main statistical findings
In 2009, industrial products and trade services represented 28 % and 18 %, respectively, of the EU’s total output while administration and other public services accounted for 14 % of total output. In the United States, industrial products and administration and other public services accounted for 22 % and 19 % of total output, followed by trade services with 16 %. The euro area had the same dominant groups as the EU as a whole, with industrial products and trade services accounting for 29 % and 18 %. Figure 1 shows how, as compared with the EU or EA, the US economy is oriented more towards services than industry, construction or trade. In all cases, agricultural products represent a very low proportion of total output (2 % in 2009).
Construction works dominate industrial output in Europe and US
Construction works accounted for 8.0 % of European and 4.7 % of US output in 2009. At the most detailed product level in the input-output tables (64 activities and 64 products), industrial output is dominated by construction works (8.0 % of the total in the EU, 4.7 % in the United States). There is a greater emphasis on education services in the EU than in the United States (3.2 % of total output as against 1.2 %) and on electricity and gas products (2.9 % as against 1.9 %).
Financial services and public administration output stronger in US than in EU
US output in financial services and public administration is stronger than the EU’s. In 2009, almost 10 % of US output came from public administration services, while the EU figure was 4.8 %. Financial and insurance services and real estate services accounted for 8.9 % and 9.5 %, respectively, of total US output, which was much more than the proportions of 5.5 % and 7.1 % in the EU (see Figure 2).
Different cost structures in EU and in US
Intermediate consumption represents the most costly inputs in the EU economy, while labour input dominates in the US economy. The input-output (I-O) tables show the production structures of the EU and US economies. The columns in the tables represent the cost structure of the industry and the rows the composition of its revenues. The value added is defined as the difference between output and intermediate consumption.
The I-O tables for 2009 highlight some differences between the two economies (see Figures 3 and 4): except for agricultural products and public administration services, input from value added is more important for the United States than for the EU. As regards industrial products, the part of value added makes up 40 % of the total for the EU, as against 49 % for the United States. In trade services and accommodation services, value added accounts for 54 % of total output in the EU but 68 % in the United States. On the other hand, for agricultural products, the proportion represented by value added is smaller in the United States: 45 % as against 47 % in the EU. For public administration services, share of value added in output is smaller in the United States than in the EU (65 % as against 72 %).
Labour input (in terms of compensation of employees) largely balances out the lower cost of intermediate consumption for the United States: construction works, trade services, information and communication services and professional and support services require more expenses on salaries (labour input is measured in terms of compensation of employees) than in the EU. Labour input accounts for 35 % of total construction costs in the United States, as compared with 22 % in the EU, and 39 % in trade services as against 29 % in the EU. In information and communication services, the figure is 30 % for the United States and 26 % for the EU.
In real estate services, the gross operating surplus is equivalent to 60 % of total output in the United States and somewhat more in the EU. In both economies, agricultural products generate a high proportion of the gross operating surplus (40 % in the EU and 29 % in the United States). Other products or services are responsible for proportions varying between 12 % and 23 % in the EU and 10 % and 25 % in the United States.
In terms of composition of its revenues, the EU uses its products in a greater proportion for intermediate consumption than the US. In Figures 5 and 6, the first left bar shows the share of intermediate consumption in the total uses. Whatever products group is considered, the share of intermediate consumption in total uses is always higher in the EU than in the US. The highest share related to professional and support services for both economies with slightly more than 80 %. The share of final consumption is quite comparable between the EU and the US, except for construction works where the 80 % remaining from intermediate consumption are fully investment in the US, while a small part is dedicated to final consumption in the EU. Exports of industrial products are slightly higher in the EU (about 15 %) than in the US (around 10 %). On the contrary, the share of exported agricultural products is higher in the US compared with the EU. For the other products groups, the ratio of exports is similar between the two economies. Information and communication services record a substantial share of investment (gross capital formation) in both economies: 21% in the US and 16% in the EU.
Impact of final demand on EU and US economies
One additional unit of final demand of industrial products would generate 2.3 of revenue/output in the EU and 1.9 in the US. Output multipliers reflect direct and indirect requirements of domestic production per one unit of final demand. One additional unit of final demand for agricultural products would generate almost two of revenue/output in the United States (same value for the EU) (Figure 7). In the EU, the biggest output multiplier is for industrial products, where one additional unit of final demand would create output of 2.3 (1.9 in the United States in 2009). Output multipliers are generally higher in the EU than in the United States: the European economy would produce more than the US economy for an increase of one unit of final demand.
Embodied employment in exports in EU and Euro area
In 2009, embodied employment in exports went down by 8 % in the EU and the euro area as compared with the previous year. The total number of persons employed by firms engaged in export activities (directly and indirectly) grew in the period to 2008 after a small decline in 2003 and 2004, but dropped in 2009 due to the economic crisis (Figure 8). The annual average growth rate in 2000-08 was 2.0 % in the EA and 0.6 % in the EU, but embodied employment in exports fell by 8 % in 2009 in the EA and the EU as a whole, dragging the average growth rate for the period down to 0.8 % for the EA and -0.4 % for the EU.
The drop in activity in 2009 was due mainly to the decrease in embodied employment in exports of manufactured products, which contributed -9.8 % in the EU and -4.0 % in the EA (Figure 9). In the EA, all commodities made a negative contribution to overall growth (-8.4 %), while in the EU-27 embodied employment linked to exports of information and communication and financial and insurance services made a positive contribution of +1.3 % in each case.
In 2000-09, the production of manufactured products for export accounted for an average of 63 % of embodied employment in EU and 64 % in EA exports. Services in the trade, transport, accommodation and food, and information and communication sectors accounted for 12 % to 14 %, on average, of the total number of persons employed by firms engaged in exporting activities in the EA and the EU as a whole.
Embodied labour income in exports down in 2009
Embodied labour income in exports fell in 2009 in both the EU-27 and the EA to the same extent as embodied employment in exports. Until 2008, embodied labour income in exports increased more rapidly in both the EU-27 and the EA than the number of persons needed to produce them, but then fell in 2009 to the same extent: around 8 % for both economic zones (see Table 1 and Figures 10 and 11).
Annual average growth rates of embodied labour income in EU-27 and EA exports were 2.2 % and 3.5 %, respectively, in 2000-09. It grew faster than the number of persons directly and indirectly employed for the production of exports (growth of -0.4 % in the EU-27 and 0.8 % in the EA), i.e. income per capita grew overall.
Strong embodied labour income in export of real estate services
Exports of real estate services contributed most to the increase in embodied labour income in the EA. With 8.2 % annual average growth in embodied labour income in the EA in 2000-09, real estate services contributed most to the overall annual growth of 3.5 % (Figure 12). Exports of real estate services contributed very negatively, with -5.1 % of annual average growth, in the EU as a whole. In the EU, financial and insurance services, followed by professional and support services and construction works, saw quite large annual average growth (over 7 %). In the EA, on the other hand, financial and insurance services show the lowest rate of growth of embodied labour income in exports over the period (2.4 %). Administration services and manufactured products presented higher annual average growth rates in the EA than the EU as a whole.
Data sources and availability
According to a standard input-output technique, the European input-output tables were used to calculate the results of the Leontief quantity model applied to employment and labour income (compensation of employees). First, a domestic input coefficient matrix (A) was calculated for each homogenous branch of activity, showing the direct input requirements for the production of one unit of output. Then the Leontief inverse matrix (the inverse of I — A, being I, the identity matrix) was computed to obtain the matrix of output multipliers. Next, the Leontief inverse matrix was post-multiplied by a column vector of exports to calculate the total output embodied in those exports. Finally, output coefficients of employment and labour income pre-multiplied the former results to obtain the employment and labour income embodied in exports.
- Embodied employment in exports: number of persons employed by firms directly engaged in export activities (direct effects), including those employed by upstream industries for the supply of the necessary inputs (indirect effects);
- Embodied labour income in exports: labour income paid by firms directly engaged in export activities (direct effects), including that paid by upstream industries for the supply of the necessary inputs (indirect effects). Labour income is measured as compensation of employees in the Use table;
For the first time, Eurostat has compiled supply and use tables for the United States using the new NACE Rev 2 classification, based on ISIC 4 and CPA 2008. The US ‘make’ and ‘use’ tables for 2008 and 2009 are available on the Bureau of Economic Analysis website. The ‘make’ matrix was compiled after redefinitions of data from the industry input-output (I-O) accounts as part of the comprehensive review of the annual industry accounts for 1998-2010 (released on XX September 2012).
Like the ‘make’ table, the ‘use’ table shows producer prices, while the European consolidated tables are in basic prices. Eurostat uses producer prices for the US table and basic prices for the EU table.
The data are collected from the European System of National and Regional Accounts (ESA 1995) transmission programme. EU Member States transmit supply and use tables (SUTs) to Eurostat annually and input-output tables (IOTs) every five years up to 36 months after the end of the reference period.
The SUTs give detailed information on production processes, interdependencies in production, the use of goods and services, and income generated in production. They form the basis for symmetrical input-output tables, which are produced by applying certain assumptions to the relationship between outputs and inputs and are used by policy-makers for input-output analysis.
Environmentally extended input-output tables (EE IOTs), an extension in Eurostat, represent another powerful analytical instrument to inform policy.
Eurostat has compiled consolidated European tables for the EU-27 and the EA since 2011.
- Building the System of National Accounts - supply and use tables (chapter of online publication Building the System of National Accounts)
- National accounts and GDP
- Supply and use tables - input-output analysis (background article)
Further Eurostat information
- European exports 2000-2007: direct and indirect effects on employment and labour income in the EU 27 and euro area - Statistics in focus 36/2012
- CO2 emissions induced by EU's final use of products are estimated to be 9 tonnes per capita - Statistics in focus 22/2011
- Supply, use and Input-output tables (naio)
- Supply, use and Input-output tables - EU aggregates (naio_agg)
Methodology / Metadata
- ESA 95 Supply Use and Input-output tables' methodology
- Eurostat Manual of Supply, Use and Input-Output Tables
- Methodological information on the compilation of the US supply and use tables in European classications, September 2013
- Methodological information on the consolidated European tables for years 2008 and 2009
- Technical Documentation eeSUIOT project