1. Task Force on Small and Medium Sized Enterprise Data (SMED)
UK presentation on:
Producing estimates on SMES: Regional data & issues to consider

2. Information Note
Figures used in the analysis do not match exactly to previously delivered estimates. They are used as development work to assess the feasibility of producing SME data from register/survey sources. They should NOT:
Be compared directly to previously delivered estimates
Be circulated outside of the task force meeting
This analysis does not take account of differences between SBS & BD estimates

3. Definition used for SMEs
Size class
Persons employed
Annual T/O
SMEs
Micro-enterprises
Up to 9
Up to £2m
Small enterprises
Up to 49
Up to £10m and no micro enterprise
Medium enterprises
Up to 249
Up to £50m and no small enterprise
Large enterprises
> 249
> £50m
Can only base SMEs on employment and T/O
T/O is based on £ as opposed to €
using a pre-defined conversion rate can be implemented – would need to consider impact of currency changes
Based on ‘reporting units’ and ‘local units’ (site level information). Accounting for larger business units is still not feasible using current survey estimates

4. SMEs – diagram to show breakdown
Note - This breakdown not used in all analyses, due to increased risk of disclosure under regional breakdown

5. Reporting the number of SMEs (recap)
Two potential options:
Register source – Business Register (IDBR)
Easier to produce & provides good estimate of number of businesses but not best approach to ‘other variables’
Survey Source – SBS regulation
Can ‘better’ estimates for the variables (such as turnover, aGVA etc) due to methodology accounting for non-sampled units (however, still not totally optimal unless sample on the required basis)
(if countries have an administrative approach to provide data under SBS then may be easier)

6. High level figures from Register
Presented at the last task force – can be replicated at lower levels of geography relatively easily

7. High level figures from Survey (SBS)
Presented at the last task force – focus on the variable level data
Based on Enterprise level – is there a better way?

8. Regional data – options
Within the survey data there are two proposed options for regional information:
Enterprise level data, region based on the location of the ‘head office’
Data that was presented at the last task force
Uses national SBS data for turnover
Does not account for regional splits of multi-site businesses
Site level data, produced using Regional SBS apportionment
SME ‘category/definition’ based on the business as a whole
Lot of SMEs (particularly micro businesses) will be single site but captures multiple sites better
Apportionment is a form of estimation, so not as accurate as returned data
Preferred method for regional data below NUTS1
Full congruent with published SBS regional results

9. Regional methodology Data collected at Enterprise level
Data apportioned amongst sites based on industry, size & location – regression model
Once the data have been apportioned to sites, totals are estimated for NUTS1
At the "all industry, all region" level regional data are constrained to equal the national total for each variable using a scaling factor
Estimating totals for detailed levels of geography
Minimum Domains – threshold below which the number of returns in any given year makes the data too volatile to use for regional apportionment
Below this level synthetic estimation replaces actual data. Reduces the impact differing samples can have on small area estimates.
Estimating totals for industry at regional level
Regional & national industry figures below totals differ as site classification is used for regional & enterprise classification for national

10. Comparison between Enterprise & Site estimates - Total SME level
Turnover (£'bn)
NUTS1 code
NUTS 1 description
Enterprise
Site
Difference
UKC
North East 28
UKD
North West
110
106 -4
UKE
Yorkshire & the Humber 85 82 -3
UKF
East Midlands 77 70 -7
UKG
West Midlands 93 86 -6
UKH
East of England
108 99
-10
UKI
London
204
217 14
UKJ
South East
174
163
-11
UKK
South West 94 79
-15
UKL
Wales 34
UKM
Scotland 76 74 -2
UKN
Northern Ireland 35 1 UK
1116
1073
-43
Note: Figures do not totally match at the UK level due to the exclusion of the Financial Sector

11. NUTS1 split using site level data
Turnover (£'bn)
NUTS1 code
NUTS 1 description
Micro
Small
Medium
Total SME
UKC
North East 7 8 13 28
UKD
North West 27 34 45
106
UKE
Yorkshire and the Humber 21 32 82
UKF
East Midlands 20 25 70
UKG
West Midlands 24 86
UKH
East of England 30 35 99
UKI
London 65 76 77
217
UKJ
South East 50 52 61
163
UKK
South West 29 26 79
UKL
Wales 12
UKM
Scotland 74
UKN
Northern Ireland 9 UK
306
365
402
1,073

12. NUTS2 split using site level data
Turnover (£'bn)
NUTS2 code
NUTS2 description
Micro
Small
Medium
Total SME
UKC1
Tees Valley and Durham 2 4 7 13
UKC2
Northumberland and Tyne and Wear 5 14
UKD1
Cumbria 3
UKD3
Greater Manchester 11 19 42
UKD4
Lancashire 6 10 22
UKD6
Cheshire 17
UKD7
Merseyside
UKE1
East Yorkshire and Northern Lincolnshire 8
UKE2
North Yorkshire
UKE3
South Yorkshire
UKE4
West Yorkshire 35
UKF1
Derbyshire and Nottinghamshire 30
UKF2
Leicestershire, Rutland and Northamptonshire 9 28
UKF3
Lincolnshire
Note: Extract, please see spreadsheet/handout for all NUTS2 estimates

13. NUTS1 by Industry (Sector) for total SMEs
Turnover (£'bn)
Section
Section description
UKC - North East
UKF - East Midlands
UKI - London
UKJ - South East
All regions A
Agriculture, forestry & fishing (part) X - 3 B
Mining & quarrying 2 C
Manufacturing 5 15 10 19
157 D
Electricity, gas, steam & air con E
Water supply & waste management 1 4 13 F
Construction 8 20
125 G
Wholesale, retail & motor trades 9 22 51 48
318 H
Transportation & storage 7 6 45 I
Accomodation & catering 39 J
Information & communication 23 12 59 K
Financial & insurance activities L
Real estate activities 26 M
Professional, scientific & technical 44 N
Administrative & support services 80 P
Education 11 Q
Health & social work R
Arts, enertainment & recreation 18 S
Other service activities 21
Industry Total 28 70
217
163
1,073
Note: Extract, please see spreadsheet/handout for all NUTS1 by sector estimates; only industries covered as part of SBS regulation

14. NUTS1 & NUTS2 data – micro, small and medium enterprises
Data can be produced at varying levels of geography
Feasible to also be split by industry
Can be produced for ‘other’ SBS variables
Industry by region would not match industry from national (based on our estimation model)
Further ‘slices’ of the data would impact
Congruent with published regional SBS data
Quality measures – Need to assess the quality as apportionment has element of estimation
Produced only using current systems, with very little resource required for additional analysis

15. NUTS1 & NUTS2 data – points to consider
Analysis suggests limited disclosure issues at NUTS1 or NUTS2 levels for SMEs
Further breakdowns of the data would have quality implications
In terms of quality & disclosure need to balance user requirements
May need to compromise on detail i.e. if want specific geographical level by industry AND MAY have to accept total SMEs (no split by micro etc)
Quality would need to be tested in more detail (produce standard errors)

16. Producing estimates on SMEs: Foreign and domestic ownership

17. Data sources – foreign & domestic owned
As for all other analysis on SMEs data can be produced from:
Business Register
Survey Source (in case of UK) – SBS regulation
Dependent on what information is required as to the source used:
Business counts – Register
Variables (turnover etc) – Survey Source (SBS)
Marker to indicate if foreign or domestic owned
Different way to ‘cut’ the data
Dependent on whether interest is national or regional

18. Foreign/Domestic Ownership – National level
Number Enterprises
Turnover (£'bn)
Domestic Owned
Foreign Owned
Micro
1,760,200
8,800
324 7
Small
204,500
6,900
348 26
Medium
33,700
4,600
323 87
SME total
1,998,400
20,400
996
120

19. Domestic/Foreign ownership – further breakdowns & issues
Producing SME data by foreign/domestic by region AND/OR industry can lead to disclosure & quality issues
Industry
Can be produced; certainly disclosure issues by SME breakdown (micro, small, medium), some industries also disclosive at overall level
Geography
Can be produced (using regional approach); again disclosure issues for certain SME breakdowns (micro, small, medium), total level generally fine
Need to determine what is required/most important
SME detail, industry, region, ownership (some but not all)

20. Foreign/domestic ownership – further information
UK publishes annual article/report on foreign/domestic owned businesses
Not looked at SMEs (yet!) as part of this publication but...
Produced analysis based on size (employment) of business by sector
Continent & country of ownership
Turnover & aGVA
Looking to expand to regional for July 2015

21. Examples of what has been produced