Gross Value Added

Important information

New GVA 'balanced' statistics

Historically, the Office for National Statistics (ONS) has produced two estimates of workplace-based regional gross value added (GVA) using the income approach (as National Statistics) and the production approach (as Experimental Statistics).

As from the December 2017 release of GVA data, which contained provisional data for 2016, the ONS have produced a new balanced measure of regional GVA, GVA (B) and an explanatory statistical bulletin. The data were originally classed as Experimental Statistics, but gained designation as National Statistics on 18 November 2018, meaning that the statistics meet the highest standards of trustworthiness, quality and value.

The new 'balanced' GVA dataset combines the strengths from both the income and production approaches and provides a single measure of economic activity within a region. The balanced GVA figures also include a dataset with estimates of nominal and 'real' growth (adjusted for inflation) for NUTS-1 and NUTS-2 areas, by industry. The GVA statistics for 2017 now include 'real' (chained volume measure) growth for NUTS-3 areas, individual local authorities and by combined authority, city regions and other economic and enterprise regions of the UK (these include local enterprise partnerships and areas seeking Growth Deals).

The ONS believe that the balanced measure of GVA should be more reliable and stable than either of its component estimates. Further information and detail about the methodology can be found in the ONS statistical bulletin - Regional economic activity by gross value added (balanced), UK: 1998 to 2017 and the ONS document – Development of a balanced measure of regional gross value added.

The ONS have discontinued the publication of individual statistical bulletins for gross value added (based on the income approach, GVA (I)), and gross value added (based on the production approach, GVA (P)). However, the ONS will continue to produce and publish the individual datasets for GVA (I) and GVA (P) to allow users access to the data in their unbalanced form.

The analysis below focusses on the new balanced GVA data the Lancashire-14 NUTS-2 area and the smaller NUTS-3 areas within the Lancashire-14 area. These are geographically based on European-defined statistical units – the so-called "Nomenclature of Units for Territorial Statistics" (NUTS).

The latest 2017 figures are provisional. Please note that GVA data are often subject to revisions in future years as more data becomes available. Revisions have previously been applied to numerous years within the series.  

GVA per head figures can suffer from distortions arising from commuting patterns and/or the composition of resident populations. This is perhaps more pertinent at the smaller NUTS-3 and individual local authority levels. For example, the 2011 Census showed that Preston gained 23,000 people in terms of net commuters, whilst Chorley saw a net outflow of 12,000 commuters. Caution should therefore be applied when interpreting the data.

Provisional gross value added (GVA) totals, balanced, 2017

In 2017, the Lancashire-14 NUTS-2 area had an overall provisional balanced Gross Value Added (GVA) total of £32.669 billion, which was the second largest in the North West region, behind Greater Manchester (£66.414 billion). The Lancashire-14 NUTS-2 total was just ahead of the figures for Merseyside (£32.032 billion) and Cheshire (£30.931 billion). The total for Cumbria (£11.568 billion) was the smallest in the region.

GVA for the Lancashire-14 NUTS-2 area was ranked into 23rd position out of 41 NUTS-2 areas in the UK (including Northern Ireland). The GVA total for the Lancashire-12 area was £27.194 billion.

For information, the 2017 provisional GVA total derived via the new balanced approach for the Lancashire-14 NUT-2 area at £32.669 billion was lower than the 2017 GVA (income approach) figure of £33.059 billion by £0.390 billion.

The Mid Lancashire NUTS-3 area (£12.114 billion) had the fourth largest provisional balanced GVA total in the North West region in 2017 (out of 20 North West NUTS-3 areas) and the 46th greatest in the UK (out of the 179 UK NUTS-3 areas).

The three Lancashire NUTS-3 areas of Blackpool, Blackburn with Darwen and Chorley and West Lancashire had the smallest GVA balanced totals in the North West region, and the total for Lancaster and Wyre was the fifth lowest (just above Sefton). These NUTS-3 areas were ranked in the lowest quarter of the UK NUTS-3 areas (in terms of GVA totals) – roughly the same as the revised 2016 figures. Blackpool NUTS-3 area (£2.421 billion) had the 15th smallest GVA total in the UK in 2017, whilst the Blackburn with Darwen NUTS-3 area (£3.054 billion) had the 25th smallest. These were the same ranking positions as in 2016.

The East Lancashire NUTS-3 area had the eighth smallest GVA total in the North West and the 69th smallest in the UK in 2017 (again the same as in 2016 (revised)).

Table 1: Workplace-based (1) gross value added (GVA) totals (£ billions), balanced, 2016 (revised) and 2017 (provisional), plus nominal and 'real' change (both change figures are provisional) for the UK and selected NUTS areas.

Area

2016 GVA(2)         (£ bn)

2017  GVA(3)       (£ bn)

Nominal  change in GVA(4)2016(2) to 2017(3)           (£ bn)

Nominal change in GVA(4), 2016(2) to 2017(3)     (%)

'Real' change in GVA(5), 2016 to 2017      (%)

Lancaster and Wyre (NUTS-3) area

4.561

 4.674

0.113

2.5

0.1

Mid Lancashire (NUTS-3) area (6)

11.831

 12.114

0.283

2.4

0.6

East Lancashire (NUTS-3) area (7)

5.938

 6.111

0.173

2.9

1.1

Chorley and West Lancashire

(NUTS-3) area

4.226

 4.295

0.069

1.6

-0.3

Lancashire-12 area

26.556

27.194

0.638

2.4

n/a (8)

Blackburn with Darwen (NUTS 3) area

2.938

 3.054

0.116

3.9

1.6

Blackpool (NUTS 3) area

2.327

 2.421

0.094

4.0

2.6

Lancashire-14 (NUTS 2) sub-region

31.821

 32.669

0.848

2.7

0.9

Cumbria (NUTS-2) sub-region

11.531

 11.568

0.037

0.3

-1.3

Greater Manchester (NUTS-2) sub-region

64.177

 66.414

2.237

3.5

2.0

Merseyside (NUTS-2) sub-region

30,501

 32.032

1.531

5.0

3.3

Cheshire (NUTS-2 sub-region)

29.192

 30.931

1.739

6.0

3.8

North West    (NUTS 1) region

167.223

 173.614

6.391

3.8

2.1

United Kingdom (less Extra-Regio) (9)

1,741.806

1,802.742

60.936

3.5

n/a (8)

United Kingdom Extra-Regio (9)

14.238

17.012

2.774

19.5

-1.8

United Kingdom total GVA (including Extra-Regio) (9)

1,756.045

1,819.754

63.709

3.6

1.9

Notes: (1) Estimates of workplace based GVA allocate values to the region or area in which the economic activity takes place; (2) Revised nominal figures (current prices); (3) Provisional nominal figures (current prices); (4) Nominal change in figures (current prices), unadjusted for inflation; (5) 'Real' change in figures, adjusted for inflation using chained volume measures for the UK, NUTS-1, NUTS-2 and NUTS-3 areas. (6) The Mid Lancashire NUTS-3 area is comprised of Fylde, Preston, South Ribble and Ribble Valley local authorities. (7) The East Lancashire NUTS-3 area is made up of the four local authorities of Burnley, Hyndburn, Pendle and Rossendale. (8) n/a = not available; (9) The GVA for Extra-Regio comprises compensation of employees and gross operating surplus which cannot be assigned to regions, such as oil and gas production on the continental shelf.

SourceOffice for National Statistics - Regional economic activity by gross value added (balanced), UK: 1998 to 2017, published 12 December 2018.

Data file - Nominal and real regional gross value added (balanced) by industry.

 

At the local authority level, Preston (£4.120 billion) and South Ribble (£3.683 billion) had the largest provisional workplace-based balanced GVA totals in the Lancashire-12 area in 2017, followed by Lancaster (£2.905 billion), Fylde (£2.683 billion) and West Lancashire (£2.452 billion). Rossendale (£1.003 billion) had the smallest total in both the Lancashire-12 area and the Lancashire-14 NUTS-2 sub-region.

Blackburn with Darwen (£3.054 billion) had the third largest provisional GVA total (balanced) in the Lancashire-14 NUTS-2 area in 2017, whilst the figure for Blackpool (£2.421 billion) was the seventh greatest in the area.

Please be aware that owing to the small areas analysed at the local authority level, and detailed industry breakdown on which they are based, some of the figures can be rather volatile. Where erratic movements are evident in the time series, caution should be taken when interpreting the data.
 

Table 2: Workplace-based (1) gross value added (GVA) totals (£ billions), balanced, 2016 (revised) and 2017 (provisional), plus nominal and 'real' change (both change figures are provisional) for local authority areas in the Lancashire-14 NUTS-2 area.

Area

2016 GVA(2)         (£ bn)

2017 GVA(3)      (£ bn)

Nominal change in GVA(4), 2016(2) to 2017(3)     (£ bn)

Nominal change in GVA(4), 2016(2) to 2017(3)     (%)

'Real' change in GVA(5), 2016 to 2017     (%)

Burnley

1.823

1.924

101

5.5

4.2

Chorley

1.842

1.843

1

0.1

-1.9

Fylde

2.743

2.683

-60

-2.2

-3.0

Hyndburn

1.493

1.528

35

2.3

-0.3

Lancaster

2.825

2.905

80

2.8

0.6

Pendle

1.652

1.656

4

0.2

-0.8

Preston

3.980

4.120

140

3.5

1.3

Ribble Valley

1.621

1.628

7

0.4

-0.9

Rossendale

970

1.003

33

3.4

0.8

South Ribble

3.487

3.683

196

5.6

3.4

West Lancashire

2.384

2.452

68

2.9

0.9

Wyre

1.736

1.770

34

2.0

-0.8

Lancashire-12 area

26.556

27.194

0.638

2.4

n/a (6)

Blackburn with Darwen UA

2.938

 3.054

0.116

3.9

1.6

Blackpool UA

2.327

 2.421

0.094

4.1

2.6

Lancashire-14 (NUTS-2) sub-region

31.821

 32.669

0.848

2.7

0.9

United Kingdom (less Extra-Regio) (7)

1,741.806

1,802.742

60.936

3.5

n/a (6)

United Kingdom Extra-Regio (7)

14.238

17.012

2.774

19.5

-1.8

United Kingdom total GVA (including Extra-Regio) (7)

1,756.045

1,819.754

63.709

3.6

1.9

Notes: (1) Estimates of workplace based GVA allocate values to the region or area in which the economic activity takes place; (2) Revised nominal figures (current prices); (3) Provisional nominal figures (current prices); (4) Nominal change in figures (current prices), unadjusted for inflation; (5) 'Real' change in figures, adjusted for inflation using chained volume measures for the UK, Lancashire-14 NUTS-2 area and local authority areas. (6) n/a = not available; (7) The GVA for Extra-Regio comprises compensation of employees and gross operating surplus which cannot be assigned to regions, such as oil and gas production on the continental shelf.

SourceOffice for National Statistics - Regional economic activity by gross value added (balanced), UK: 1998 to 2017, published 12 December 2018.

Data files - Nominal and real regional gross value added (balanced) by industry and Regional gross value added (balanced) local authorities by NUTS1 region: UKD North West: 1998 to 2017

 

Provisional gross value added per head figures, balanced, 2017

The 2017 provisional GVA per head figure (balanced) for the Lancashire-14 NUTS-2 area at £21,918 was almost a fifth lower than the UK less Extra-Regio figure (£27,298) and was ranked 25th in the UK and 4th in the region behind Cheshire (£33,384), Greater Manchester (£23,730) and Cumbria (£23,212). It was however above the figure for Merseyside (£20,740).

Note: Extra-Regio GVA comprises compensation of employees and gross operating surplus which cannot be assigned to regions, such as oil and gas production on the continental shelf.

 

Locally, only the Mid Lancashire NUTS-3 area (£31,053) had a provisional balanced GVA per head figure above that of the UK less Extra-Regio figure in 2017, by 13.8%. The Mid Lancashire NUTS-3 area is comprised of Fylde, Preston, South Ribble and Ribble Valley local authorities. The area had the fourth highest balanced GVA per head figure in the North West in 2017 and was ranked in 29th place out of the 179 NUTS-3 areas in the UK.

The on-line ONS statistical bulletin - Regional gross value added (balanced), UK: 1998 to 2017 contains an interactive map at section 6 that allows balanced GVA per head figures for the 179 NUTS-3 areas in the UK to be visualised in time series graph from 1998 to 2017. This shows that the Mid Lancashire NUTS-3 area was the only Lancashire NUTS-3 area to keep pace with the UK in terms of balanced GVA per head since 1998 and outperform the UK average since 2015.

In contrast, the provisional balanced GVA per head figure for the Blackpool NUTS-3 area (£17,309) in 2017 was over a third lower than the UK figure. It was the fifth lowest figure in the region and 27th lowest in the UK.

The provisional GVA per head figures (balanced) for the three Lancashire NUTS-3 areas of Lancaster and Wyre (£18,482), East Lancashire (£18,564) and Chorley and West Lancashire (£18,701) were clustered fairly close together, roughly a quarter of the way from the bottom of the NUTS-3 rankings. The figures were 32.3%, 32.0% and 31.5% below the UK figure, and were the sixth, seventh and eighth lowest amounts in the North West region, respectively.

The provisional balanced GVA per head figure for the Blackburn with Darwen NUTS-3 area (£20,525) in 2017 was almost a quarter lower than the UK figure. It was the ninth lowest in the region (out of 20) and ranked in the 76th lowest position in the UK (in the lower half of the NUTS-3 rankings).

Table 3: Workplace based gross value added per head (1), balanced, at current prices, 2016 (revised) and 2017 (provisional), and provisional nominal change

Area

2016 GVA per head(2)       (£)

2017 GVA per head(3)      (£)

2017 GVA per head Indices (3) (UK less Extra-Regio(4) = 100)

Nominal change in GVA per head(5), 2016(2) to 2017(3) (£)

Nominal change in GVA per head(5), 2016(2) to 2017(3)   (%)

Lancaster and Wyre (NUTS-3) area

 18,118

 18,482

67.7

364

2.0

Mid Lancashire (NUTS-3) area

 30,479

 31,053

113.8

574

1.9

East Lancashire (NUTS-3) area

 18,094

 18,564

68.0

470

2.6

Chorley and West Lancashire

(NUTS-3) area

 18,589

 18,701

68.5

112

0.6

Blackburn with Darwen (NUTS 3) area

 19,793

 20,525

75.2

732

3.7

Blackpool (NUTS 3) area

 16,621

 17,309

63.4

688

4.1

Lancashire-14 (NUTS 2) sub-region

 21,445

 21,918

80.3

473

2.2

Cumbria (NUTS-2) sub-region

 23,119

 23,212

85.0

93

0.4

Greater Manchester (NUTS-2) sub-region

 23,078

 23,730

86.9

652

2.8

Merseyside (NUTS-2) sub-region

 19,826

 20,740

76.0

914

4.6

Cheshire (NUTS-2 sub-region)

 31,662

 33,384

122.3

1,722

5.4

North West (NUTS 1) region

 23,148

 23,918

87.6

770

3.3

United Kingdom less Extra-Regio (4)

 26,532

 27,298

100.0

766

2.9

Notes: (1) Estimates of workplace based GVA allocate values to the region or area in which the economic activity takes place; (2) Revised nominal figures (current prices); (3) Provisional nominal figures (current prices); (4) The GVA for Extra-Regio comprises compensation of employees and gross operating surplus which cannot be assigned to regions, such as oil and gas production on the continental shelf; (5) Nominal change in figures (current prices), unadjusted for inflation;

SourceOffice for National Statistics - Regional economic activity by gross value added (balanced), UK: 1998 to 2017, published 12 December 2018.

Data file - Nominal regional gross value added (balanced) per head and income components.

 

Provisional yearly growth/decline in nominal (unadjusted for inflation) balanced gross value added totals, 2016 to 2017

Between 2016 and 2017, the balanced GVA total for the UK (including the Extra-Regio component), showed provisional nominal growth (unadjusted for inflation) of 3.6%. The Lancashire-14 NUTS-2 area was estimated to have increased provisionally by a lower 2.7% in nominal terms (Lancashire-12 = 2.4%). In the North West provisional nominal growth was estimated at 3.8%. Cheshire (6.0%) and Merseyside (5.0%) showed the highest provisional nominal growth in the region. 

Within the Lancashire-14 NUTS-2 area, only Blackpool (4.0%) and Blackburn with Darwen NUTS-3 area (3.9%) had provisional nominal annual growth rates in GVA above the UK figure (3.6%). The East Lancashire NUTS-3 area (2.9%), Lancaster and Wyre NUTS-3 area (2.5%), Mid Lancashire NUTS-3 area (2.4%), and the Chorley and West Lancashire NUTS-3 area (1.6%), all had provisional nominal growth rates in GVA (unadjusted for inflation) below the UK figure.

At the local authority level, South Ribble (5.6%) and Burnley (5.5%) in the Lancashire-12 area, and Blackpool (4.1%) and Blackburn with Darwen (3.9%) in the wider Lancashire-14 NUTS-2 sub-region saw their nominal (unadjusted for inflation) GVA totals (balanced) increase provisionally by more the UK nominal rise of 3.6%. 

Ribble Valley (0.4%), Pendle (0.2%) and Chorley (0.1%) saw the lowest nominal growth (unadjusted for inflation) in the Lancashire-14 NUTS-2 sub-region, whilst Fylde saw the only provisional fall in its nominal GVA balanced total in the area.

Provisional yearly growth/decline in 'real' (adjusted for inflation) balanced gross value added totals, 2016 to 2017

The new balanced GVA dataset for 2017 contains estimates of 'real' (chained volume) growth/decline for the balanced GVA totals (ie adjusted for inflation) at the NUTS-1 regional level, the NUTS-2 sub-regional level and the NUTS-3 level (for the first time).

Between 2016 and 2017, the balanced GVA total for the UK (including the Extra-Regio component), showed provisional 'real' growth (adjusted for inflation) of 1.9%. In the North West, provisional 'real' growth was estimated at 2.1%. Cheshire (3.8%), Merseyside (3.3%) and Greater Manchester (2.0%) showed the highest provisional 'real' growth in the region at the NUTS-2 level.

The balanced GVA total for the Lancashire-14 NUTS-2 area was estimated to have increased provisionally by a lower 0.9% in 'real' terms between 2016 and 2017. 

At the NUTS-3 level, within the Lancashire-14 NUTS-2 sub-region, Blackpool (2.6%) was estimated to have increased provisionally by the greatest percentage in 'real' terms (adjusted for inflation) between 2016 and 2017, followed by Blackburn with Darwen (1.6%), East Lancashire (1.1%), Mid Lancashire (0.6%) and Lancaster and Wyre (0.1%). The Chorley and West Lancashire NUTS-3 area showed a provisional 'real' decline in its balanced GVA total of -0.3% from 2016 to 2017.

At the local authority level, only Burnley (4.2%) and South Ribble (3.4%) in the Lancashire-12 area, and Blackpool (2.6%) in the wider Lancashire-14 NUTS-2 sub-region saw their 'real' (adjusted for inflation) balanced GVA totals increase provisionally by more the 'real' UK growth of 1.9%. 

The six Lancashire-12 local authority areas of Fylde (-3.0%), Chorley (-1.9%), Ribble Valley (-0.9%), Pendle (-0.8%), Wyre (-0.8%) and Hyndburn (-0.3%) saw provisional 'real' reductions (adjusted for inflation) in their balanced GVA totals between 2016 and 2017.

Provisional yearly growth/decline in nominal (unadjusted for inflation) balanced gross value added per head figures, 2016 to 2017

The provisional nominal growth (unadjusted for inflation) in balanced GVA per head for the Lancashire-14 NUTS-2 area over the previous year at 2.2% was lower than that recorded for the UK (less Extra-Regio) of 3.0%. Nominal growth in balanced GVA per head for the North West was provisionally estimated at 3.3%. Cheshire (5.4%) and Merseyside (4.6%) had the highest provisional nominal growth in balanced GVA per head in the region.

The Blackpool (4.1%) and Blackburn with Darwen (3.7%) NUTS-3 areas had provisional nominal growth rates (unadjusted for inflation) in balanced GVA per head that were greater than the UK figure (3.0%). The four NUTS-3 areas of East Lancashire (2.6%), Lancaster and Wyre (2.0%), Mid Lancashire (1.9%) and Chorley and West Lancashire (0.6%) were provisionally estimated to have lower nominal growth in balanced GVA per head than the UK increase from 2016 to 2017.

Balanced GVA per head figures at the local authority level are not published at the present time. 

Further analysis and report to follow

Page updated March 2018 (initial analysis of data)