National Statistical

The Office for National Statistics has today launched a new tool, allowing users to see how products and industries are interdependent across the economy. Marianthi Dunn writes about how these data, drawing information from National Accounts ‘Input-Output Tables’ shed more light on how the UK economy operates.  

The new tool we are launching today, which is the first of its kind for a developed economy, shows how the different industries and products are dependent on each other. Based on the principles of Input-Output analysis, it looks at how products and industries feed each other; such as forestry feeding the furniture-making industry. This method used for analysing the structural changes within economies, can be difficult to interpret and understand, particularly for non-technical audiences. 

Today’s new online Input-Output analysis tool presents data from the UK’s input-output analysis tables in a simple visual format, allowing users to easily understand which industries used individually selected products the most, which goods and services were used to produce individual products and how a change in demand for a particular product can have knock on effects elsewhere in the economy; such as gross value added, output, wages and salaries and imports.  

The new tool allows users to look at both direct and indirect impacts of economic changes. For example, to build more houses would require additional products such as bricks, cement, steel, construction equipment, labour and other inputs. The indirect (or secondary) effects would include the impact on suppliers of these primary products, such as what products are required to produce more bricks. By using Input-Output analysis, users can understand the change in output across the economy, due to a change in inputs in one or more specific industries. 

As well as making life much easier for economists and academics, the Input-Output analysis tool gives policy makers an accessible overview of both the context and the potential effects of their decisions. It’s also a helpful tool for journalists, allowing them to quickly understand the structure of the UK’s economy, minimising misinformation. 

If you want to know more about this important new tool, please contact us on: sut@ons.gov.uk 

Marianthi Dunn, Head of Input Output Analysis