An Overview of Business Tendency Surveys

1. An Overview of Business Tendency Surveys Richard Vincent Richard Evans Statistics Canada International Conference on Establishment Surveys Montréal June, 2007

2. Outline • Introduction • Global Overview of Business Tendency Surveys 3. Business Tendency Surveys in France 4. Business Tendency Survey in Canada 5. Conclusion

3. Introduction Key Question These surveys have many commonalities, yet there are striking differences. Why?

4. Qualities of Business Tendency Surveys • Relevant • Timely • Qualitative, but based on informed opinion • Forward looking (focus on next period) • Comparable

5. Global Overview of BTSs

6. Global Overview of BTSs Industrial Coverage of BTSs • Europe • Manufacturing • Construction • Retail Trade • Other Service Industries • Canada • Manufacturing • Traveller Accommodation • Purchasing Managers (USA, Europe) • Manufacturing • Services

7. Global Overview of BTSs Content Future / current business situation re: • Production • Prices • Labour market

8. Business Tendency Surveys BTS in Canada Manufacturing BCS • Since 1976 • Quarterly • Stratified sample of 10,000 est. • 2 pages • Three sections • Impediments • Current conditions (last quarter) • Future conditions (next quarter)

9. BTS in Canada Manufacturing BCS • Well respected as leading indicator • Two financial institutions ‘repackage’ manufacturing BCS and release • Much media attention • Can influence value of Cdn $

10. BTS in Canada

11. BTS in Canada Manufacturing BTSs and the Canadian Statistical System • Not required as input into System of National Accounts • Considered during analysis of composite leading indicators • Supported by Department of Finance and Bank of Canada

12. BTS in Canada • Quarterly Business Conditions Survey for the Traveller Accommodation industry • Developed in partnership with Canadian Tourism Commission; Ontario Ministry of Tourism is now key supporter • Released for the first time: May 16, 2005 (Q2) • Stratified sample of 2,500 establishments • 2 pages, qualitative (comparable to Manufacturing BCS) • Garnered much media coverage • Used by National Tourism Indicators; Composite Leading Indicator • Pilot surveys of BCS for Arts, Heritage, & Recreation

13. BTS in Canada Why a BTS on Traveller Accommodation • Surrogate for tourism sector • Industry suffers from severe slowdowns and shocks; at the cusp of the business cycle • Client interest in: • forward looking indicators/intelligence • Impediments • Evidence based decision making for policy and marketing • Advocacy; e.g., media attention • Policy making • Used by National Tourism Indicators; Composite Leading Indicator

14. BTS in Canada – Why new survey?Tourism demand in Canada by product

15. BTS in Canada-- Why new survey?Change in Traveller Accommodation Revenues, Yr/Yr

16. BTS in CanadaWhy new survey?

17. BTS in Canada– Results Traveller AccommodationOutlook for Occupancy RatesBalance of Opinion (0=neutral)

18. BTS in Canada– Results Traveller AccommodationOutlook for Average Daily Room RateBalance of Opinion (0=neutral)

19. BTS in Canada– Results Traveller AccommodationBusiness ImpedimentsQ4 2006

20. BTS in Canada– Results Traveller AccommodationPublic Health and Safety no longer a worry

21. BTS in Canada– Results Traveller Accommodation‘Canada’s reputation’ increasingly important

22. BTS in France • Institut national de la statistique et des etudes economiques (Insee) • Extensive array of surveys • Since 1952

23. BTS in FranceSome features • 1-3 pages • 1000 to 5000 respondents • Results in overall balance of opinion significant to 2 to 3 points

24. BTS in France Some features (cont’) • Sectoral surveys • Thematic surveys

25. BTS in FrancePartial list of Surveys • [LIST HERE]

26. BTS in FranceExamples • [show very detailed questions on questionnaires]

27. BTS in FranceExamples (cont’) • [show example of outputs]

28. BTS in FranceExamples (cont’) • [show example of European outputs]

30. Main Differences between Canadian and French BTS programs • Different emphasis on production impediments • Better coverage in France

31. Conclusion Reasons why Canadian and French BTS programs are different • Different mandates, client demand • Different pressures to harmonize

32. Conclusion Different mandates: • Insee has a mandate to forecast GDP • 2 quarters forward • Highly regarded • This generates an internal demand • Statistics Canada does not • Different focus: • E.g., complete set of input-output accounts by province • Extensive suite of largely survey-based annual surveys to support the latter

33. Conclusion Different mandates, different priorities • Canada: surveys that produce best possible quantitative current indicators for GDP • Survey-based • Less financial pressure to use administrative data sources • No influential internal client for qualitative BTS • However, an external client for its traveler accommodation survey

34. Conclusion Different mandates, different priorities (cont’) • France: surveys that produce best possible qualitative leading indicators for GDP forecasts • Influential internal client • All survey-based • Mandatory • Current indicators are comparatively less important, greater financial pressures to use administrative data sources

35. Conclusion Different international pressures to harmonize • Why are such differences “tolerated”? • No pressures to harmonize in the sense the different iterations of the SNA 93 have exercised strong harmonizing influence since the 1950’s • Perception that BTS are “less important”, especially by agencies that do not publish forecasts • CIRET’s recommendations are not nearly as binding • There are strong pressures from within the EU • But Canada is not a member!

36. Conclusion The Future : what would need to change? • A change in mandate • International will and desire to “compel” countries to adhere to an international standard (in the manner of the SNA) • Client financial commitment