Statistics Finland

Economic Statistics

Statistics Finland 
Economic Statistics,
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The producer price index for services (130201 PRON) measures developments in the prices of services enterprises produce for each other, for households and for the public sector. Each individual industry-specific index describes the average price development in that industry.

Statistical classification of products by activity CPA version 2.1.

Statistical classification of economic activities NACE Rev. 2.0

As far as appropriate, the services of specific industries are classified into main groups according to the CPA product classification, which is the European Union’s classification of goods and services by activity. Where necessary, detailed product classifications are used within the individual service product categories of the CPA.

The following NACE Rev. 2 activities are required by the European business statistics (EBS) regulation:

• Activities in Section H of NACE Rev.2: H49, H50, H51, H52, H53
• Activities in Section I of NACE Rev.2: I55, I56
• Activities in Section J of NACE Rev.2: J58, J59, J60, J61, J62, J63
• Activities in Section L of NACE Rev.2: L68
• Activities in Section M of NACE Rev.2: M69, M702, M71, M73, M74
• Activities in Section N of NACE Rev.2: N77, N78, N79, N80, N81 and N82

and these are approximated with indices of corresponding CPA version 2.1 classes.

Nationally more index series are published for activities in Sections H, I, J, L, M, N, P, Q, R and S of CPA version 2.1.

Producer price indices for services describe the price development in business services provided by enterprises to other enterprises and the public sector (business-to-business, BtoB) and by enterprises to households (business-to-consumers, BtoC).

As a rule, the data are collected quarterly and they must be submitted to Statistics Finland within about seven days from receipt of the inquiry, or at the latest as soon as the requested information becomes available. Where appropriate, for example due to the pricing method used by a data supplier, data may also be collected more or less frequently.

The time of quotation is the price at the time of the first, second or third month of the quarter depending on the service activity. The quarterly average prices are used in services with volatile prices and / or large weight in the index.

Observation unit: KAU

Reporting unit: KAU

Population

• In EU’s STS statistics services belonging to the NACE Rev. 2 activities: H49, H50, H51, H52, H53, I55, I56, J58, J59, J60, J61, J62, J63, L68, M69, M702, M71, M73, M74, N77, N78, N79, N80, N81 and N82
• Nationally services belonging to the CPA version 2.1 Sections H, I, J, L, M, N, P, Q, R and S.

Frames and weight sources

• National accounts: supply and use tables (SUT)
• Business Register
• Statistics on service industry commodities

Description

The Producer price index for services is compiled on product basis. The index describes development in the prices of certain types of services irrespective of the main industry of the producing enterprise. If a service enterprise also produces goods, its goods production is excluded from the scope of the Producer price index for services. On the other hand, an enterprise that mainly produces industrial goods may also produce services in which case its services production is included in scope of the description of the Producer price index for services.

Statistics Finland’s Business Register is used as the sampling frame for the Producer price indices for services. In addition, statistics on service industry commodities is used in some cases. The Business Register contains data on the industry and turnover of enterprises. The statistics on service industry commodities describe the structure of turnover and services produced in certain branches of industry providing business services. The indices have been developed independently for individual service industries, which is why the used sampling method varies by industry. Depending on the industry, the data suppliers have been selected either by PPS (Probability Proportional to Size) sampling, judicious sampling or by combining judicious sampling and probability-based sampling. The services for the price monitoring have been selected in co-operation with service enterprises.

The Producer price indices for services are calculated using over 22,000 price data items collected from approximately 2,400 data suppliers. The numbers of price data items and data suppliers vary by industry and index series (BtoB and BtoC).

The producer price data include a number of large data sets from enterprises, and price data for some product categories is retrieved from application programming interfaces (API). Large data sets and APIs are utilized especially in BtoC-prices. The number of data items above includes price data from APIs and excludes the number of observations of the large data sets; only the aggregates calculated from them are included. 

Coverage

The coverage of different industries varies; from the complete coverage of industry 531 Postal activities under universal service obligation to lower coverage of industry 692 Accounting, bookkeeping and auditing activities; tax consultancy, where there are thousands of enterprises and large enterprises do not fully dominate the industry. However, as price development is measured, it is also essential to proportion the sample size to the variance of price development.

The geographical coverage is the whole country.

The index contains mainly domestic prices. However, enterprises may report also non-domestic prices if they are significant. The share of non-domestic prices is not known because Statistics Finland does not compile non-domestic price index for services.

One of the main uses of SPPI is to be a deflator for national accounts and volume indices. That is why it is good to consider global issues also in price indices if possible.

The length of the industry-specific time series varies depending on when the production of the industry index started. Data on most series can be found onwards the year 2005.

Nationally published total index starts from 2005.

Base year (the year on which the weights are based): 2020

Base period: 2021

Reference year (the year when the index equals 100): 2021

Index

Quarter

In some cases prices refer to the first, second or third month of the quarter in question

Summary

• The European Parliament and Council adopted the European Business Statistics (EBS) Regulation (EU) 2019/2152 on 27 November 2019, followed by the Commission Implementing Regulation 2020/1197 laying down technical specifications and arrangements pursuant to the mentioned EBS Regulation (General Implementing Regulation).
• The structure of statistical metadata has been harmonised by Commission Recommendation of 23 June 2009 on reference metadata for the European Statistical System (Text with EEA relevance).
• The Council Regulations (EC) concerning short-term statistics
• The Statistics Act (280/2004, amendment 361/2013)
• Inquiry is mandatory. Sanctions are possible for non-respondents.

Responsibility for collecting, processing, and disseminating statistics

The Statistics Act (280/04) is the general act for the National Statistical Service (NSS). It contains the principles for the data collection, processing, and dissemination of official statistics. The act defines the roles of statistical authorities (Statistics Finland, Customs, National Institute for Health and Welfare, and Tike, Information Centre of the Ministry of Agriculture and Forestry) and other authorities producing statistics. The Statistics Finland Act (48/1992) states that Statistics Finland (SF) shall provide for the general development of official statistics in collaboration with other central government authorities.

The aim of the NSS is to produce official statistics, Official Statistics of Finland (OSF). European law (especially the Regulation of the European Parliament and of the Council on European statistics (EC) No 223/2009) applies to a large portion of OSF.

• Statistical legislation | Statistics Finland
• Legislation | Statistics Finland
• Official Statistics of Finland (OSF) | Statistics Finland

Ensuring statistical reporting

The Statistics Act requires that the primarily exploited sources for statistical purposes shall be the data accumulated in the administration of general government and the data produced as a consequence of the normal activities of employers, self-employed persons, corporations, and foundations. SF has the right to have access to these data under the Statistics Act. In addition, all public and private entities in Finland are obliged to provide SF with data on their finances, products and staff as necessary for the production of statistics. The right of SF to collect data by virtue of the obligation does not extend, however, to data that are kept confidential for reasons of international relationships, public safety, the interest of national defence, or the safety of the state. Before any data collection based on the obligation, the statistical authority must consult the respondents or their representatives about the contents, timing, collection methods, duration of storing of the data as well as about costs. Besides those data obtained directly from administrative sources data from natural persons are always collected on voluntary basis by using interviewing or mail and web surveys. In addition, the interviewees must be informed in advance in a written form.

The Statistics Act stipulates that a data provider who willfully fails to provide the obligatory data or willfully provides false data shall be sentenced to a fine. Nevertheless, SF is allowed to refrain from bringing charges if the violation is regarded as minor, but in practice charges have not been filed.

Data sharing and coordination among data producing agencies

According to the Statistics Act, data obtained by four statistical authorities may be released to other parties either if permitted by legal provisions explicitly concerning the NSS, or upon express consent of the subject of the data. As far as statistical authorities are concerned they are allowed to transmit confidential data with identifiers to each other if it is deemed necessary for the production of statistics. The same applies to the European Statistical System authorities (ESS Authorities). Co-ordination among data-producing agencies is normal practice at both specialist and top level.

Finnish SPPI is reported quarterly to Eurostat.

Confidentiality of individual reporters' data

Several legal acts guarantee that individual data should be kept confidential.

• According to the Act on the Openness of Government Activities (621/1999) data collected for statistical purposes are confidential. The rule is not applied to the publicity of data describing the activities of central and local government authorities and production of public services or to certain data in the Register of Enterprises and Establishments.
• Under the Statistics Act, statistics shall be compiled so that the respondents whom they concern are not directly or indirectly identifiable. Violation of the secrecy obligation is punishable under the Penal Code. At the EU level, similar assurances are included in Council Regulation (EC) No 223/2009.
• Details regarding the protection of information on private individuals are laid down in the Finnish Personal Data Act (523/1999).

The Statistics Act obliges statistics-producing authorities to inform respondents in writing or in other appropriate manner about the intended use of the data, the procedures to be used in producing the statistics, the principles governing whether the provision of data is obligatory or voluntary, the rights of the respondents, the arrangements for protecting the data, and the duration the data will be stored.

The Statistics Act allows a statistical authority to grant access to confidential data for use in scientific research or statistical surveys if statistical units cannot be identified directly from them. The right to use data may be given in compliance with a well-defined process including a written application.

Statistics Finland (SF) has implemented procedures to prevent disclosure of any individual data provider. It has published guidelines on how to apply the Statistics Act and the Personal Data Act, as well as guidelines on the protection of tabulated data on enterprises and individual persons. Micro data concerning individual persons released for scientific research are first edited to remove variables that would make it possible to directlyidentify individual persons such as name, address or personal identification number. Similar procedures are used with respect to sensitive information about units other than individual persons.

Further information on Data Protection in SF's website: Data protection | Statistics Finland

Confidentiality and reference to the Statistics Act are announced in the data collection questionnaire. Links to different acts on statistics and ethical principles are presented on the website of Statistics Finland. The guidelines on professional ethics of Statistics Finland have been published: Statistics Finland : Guidelines on Professional Ethics

Producer price index for services is so-called "insider statistics", which cannot be released into public before the official publication. Employees have an obligation of secrecy.

The confidentiality of the information, prices, is taken into account when publishing the statistics: no information on individual enterprise can be deducted from the results.

If the price movements of single enterprise can be detected from any 1-, 2-, 3- or 4-digit CPA level index, then that index series is flagged as confidential data.

Indices are published simultaneously to all interested parties at statistics' homepage: Producer price indices for services - Statistics Finland

The release calendar is available at Future releases - Statistics Finland

No one has prior access to the statistics before their general release.
Index series are transmitted to Eurostat on the same day they are published in Finland. The transmission is done via Edamis by using SDMX coding system.

Advance release calendar

A release schedule for the coming year, specifying precise dates of release, is published in the Release Calendar in December by Statistics Finland.

The calendar is available on the website of Statistics Finland: Future releases - Statistics Finland

Summary

Indices are published simultaneously to all interested parties at statistics' homepage. No one has prior access to the statistics before their general release.

A news release is made quarterly available to the media and the public on statistics' homepage. 

Disclosure of terms and conditions for statistical collection, processing, and dissemination

Information on and links to the legislation governing SF are available on its website and in the Library of Statistics. There is a special service on the internet for those obliged to give information to SF, the data collections section. All statistics compiled by SF have a homepage of their own, with a permanent internet address (stat.fi/en/statistics/name of the statistic). In addition to statistical data, these homepages contain a large set of metadata concerning the statistic in question.

A Release Calendar of statistics is available on SF’s website.

Statistical publications include SF’s general contact information and references where more specific information can be found. SF’s Information Service (Tel.: +358 29 551 2220) provides information on the collection, processing and dissemination of statistics, too.

Internal governmental access to statistics prior to release

There is no internal governmental access to data before their release to the public. No ministerial commentary is attached to released data.

Attribution of statistical products

Publications contain a statement that quoting is encouraged provided SF is acknowledged as the source.

OSF publications cannot be published under the name of an individual author. The publications (printed and web versions) can be identified from the OSF label/ are labelled with the OSF logo. Release guidelines for Official Statistics of Finland.

Simultaneous release

The key results are released simultaneously to all interested parties on predefined days on the home page of the statistics.

According to the Act on the Openness of Government Activities, statistical data considered as sensitive information may not be disclosed to a third party prior to their publication. Price indices are included in this group as the published figures may have an influence on the capital and financial markets. Statistics Finland makes the decision on the sensitivity of statistics, including their intended publication dates.

Quarterly

Producer price index for services is published on the 24th day of the month following the statistical reference quarter or on the first working day following it.

A news release is published quarterly on statistics' homepage: Producer price indices for services - Statistics Finland

The latest index figures are analyzed, and index figure tables and database are updated. 

Publications are available free of charge on the statistics' homepage: Producer price indices for services - Statistics Finland

The StatFin online database: PxWeb - Select table (stat.fi)

All the public index figures with time series are available free of charge in the StatFin online database.

The needed PX-Axis softwares may be downloaded from: Px suite | Statistics Finland

Microdata access

Statistics Finland's researcher services offer unit-level data, i.e. micro data, for scientific studies and statistical surveys. The conditions and rules with respect to data access can be found on the home page: Research services | Statistics Finland

Data are sent to Eurostat

Dissemination on request

Tailored tables and data files are provided for a fee.

A short description of statistics, quality descriptions, concepts and definitions, user's handbooks and weight structures are available free of charge on statistics' homepage: Producer price indices for services - Statistics Finland

A link to user's handbook: Producer price indices for manufactured products and services 2015=100 : Handbook for users (stat.fi)

A link to statistics' documentation and weight structure: Producer price indices for services: documentation of statistics - Statistics Finland

International recommendations on service producer price index are followed, thus link to Eurostat's and OECD's manuals of developing PPI for services: Methodological guide for developing producer price indexes for services industries (oecd.org) or Eurostat-OECD Methodological Guide for Developing Producer Price Indices for Services (europa.eu)

Advance notice of major changes in methodology, source data, and statistical techniques.

Advance notice is given to the public when major changes are introduced in methodology, sources, and statistical techniques. In the case of major changes, briefings for the main users and press will be organised.

Revision releases are published on the statistics' homepage: Producer price indices for services - Statistics Finland

Quality descriptions are available at the statistics' homepage: Producer price indices for services: documentation of statistics - Statistics Finland

Quality management

Quality management requires comprehensive guidance of activities. The principles of the European Foundation for Quality Management (EFQM principles) are employed by Statistics Finland as its overall framework for quality management. The quality management framework of the field of statistics is the European Statistics Code of Practice (CoP). The frameworks complement each other. The quality criteria of Official Statistics of Finland are also compatible with the European Statistics Code of Practice. Further information on Statistics Finland's website: Quality management | Statistics Finland

Quality monitoring

The top management of SF has made several self-assessments in line with the EFQM model. There have also been external audits by e.g. the EU and IMF experts. Processes are in place to monitor the quality of the statistical process and the processes of individual statistics. Quality considerations are an integral part of the planning and evaluation of the statistical programme.

The process owner of statistical production and its supporting group monitor the quality and steer the standardisation of work processes.

Statistics Finland has an internal quality audit system. The main objectives are to evaluate the ways of working, methods and techniques. An audit is carried out by an audit team of experts who are external in the sense that they do not have any direct connection with the production process in question.

About 8 audits are carried out yearly.

Impartiality of statistics

Section 11 of the Finnish Statistics Act contains the requirement that statistics should be as reliable as possible, give a truthful picture, and make use, if possible, of uniform concepts, definitions, and classifications, as well as be timely. Similar provisions can be found in EU legislation. The Statistics Act, the Statistics Finland Act, and the Council of State Decree on Statistics Finland (1063/2002) and several other legal provisions support SF’s professional independence:

• Section 3 of the Statistics Finland Actdecrees that the internal organisation of SF is defined in internal Rules of Procedure which are decided by SF’s Director General (DG);
• Section 1 of the Council of State Decree on SF gives the DG the right to manage the activities and finances of SF;
• Section 5 of the Council of State Decree lays down that the DG shall be appointed by the Council of State for a fixed term. The nomination is made after open competition. The Decree also gives the DG the right to appoint the staff of SF, including directors of the departments as well as other staff members unless the decision-power has been delegated in the Rules of Procedure to some other official of SF;
• Section 10 of the Statistics Act provides that data processing shall take place in accordance with good statistical practice and the international recommendations and procedures generally applied in the field of statistics.

Selection of sources, methodology, and modes of dissemination

The selection of sources, methodology and modes of dissemination of SF statistics are decided by SF alone. According to the Statistics Act, the choice of data sources, statistical techniques, and methods of dissemination should be based on statistical considerations (Sections 3, 10, 11, and 12). There are also responsibilities regarding cost-efficiency and the response burden of data collections (Section 4).

Guidelines for staff behavior

On the basis of international recommendations SF has confirmed its own Guidelines on Professional Ethics. All employees are given a copy of this handbook: Statistics Finland : Guidelines on Professional Ethics

An internal ethical board meets regurlarly and reports on its decisions and discussions on the intranet open to all staff of SF. 

Dissemination of documentation on concepts, scope, classifications, basis of recording, data sources, and statistical techniques

The quality description of the statistics, as well as concepts and definitions (in Finnish, English and Swedish), are available on the homepage of the statistics: Producer price indices for services: documentation of statistics - Statistics Finland

Accuracy and reliability
There are several possible sources of bias in the producer price index for services. These sources of bias include:

• sampling error
• deficient product and enterprise frameworks
• non-response
• quality changes in service products included in price collection
• substitution bias

Timeliness and punctuality
The producer price indices for services are published on the 24th day of the month following the statistical reference quarter or on the first working day following it. The data are published on the days indicated in the release calendar.

Coherence and comparability
European definitions according to the European business statistics regulation are used in the production of the statistics, so the data of the statistics are internationally comparable and cover the whole of Finland. 

From 2019 onwards, the producer price indices for services are annual chain indices. The chain-linked index method means that the weight structure of the producer price indices for services is updated every year. The new weight structure takes effect starting from the index for the first quarter of each year. The base year of the index remains unchanged.

EU's EBS regulation is fully met, and user needs are considered almost fully met.

Sometimes price indices are asked at a very detailed - and not public - level. Furthermore, due to the data confidentiality rules, not every index series is public.

Researchers: Access to the micro data is improved as Statistics Act was amended.

Main users:

• National accounts, and other statistics
• Bank of Finland
• Government
• Research institutions
• Eurostat
• ECB
• IMF
• Market analysts
• Enterprises
• Media

Main uses:

• Fixed value and volume calculations (V=P*Q)
• Index escalation; trade deal negotiations
• Economic follow-up and forecasting
• Budgeting and follow-up

Monitoring user requirements

Co-operation between SF and important users with regard to the relevance of statistics and the users' needs consists of an extensive feedback system and co-operative working groups with the main users, such as users of national accounts. There are regular meetings of SF directors and experts with the users, even at the senior management level. Users are usually also invited to participate in discussions concerning the establishment of new statistics or revisions of existing ones.

In addition, there are specific feedback systems for receiving the users' opinions at SF. These systems consist of an anonymous feedback channel on the web, media monitoring, surveys among different user groups for the evaluation SF’s performance, user surveys (every second year, latest in 2022), and a system for collecting and disseminating information that is strategically important for SF. Specific statistical products conduct their own user surveys and keep in regular contact with their main interest groups. 

All the required series are produced.

Possible error sources, list is not exhaustive. Bias may occur up- or downward, and its degree varies. Statistics Finland has not estimated the accuracy of producer price index for services, i.e. differences between estimated index figures and population values. As an expert assessment, producer price index for services is considered unbiased and accurate.

• indeficiencies in product and enterprise frames
• sampling error
• outdated weight structures due to structural changes in economy
• misunderstandings concerning price questionnaires
• non-response
• errors in data processing
• handling of quality changes in products/services
• handling of new products/services entering, and old ones exiting from the market
• measurement difficulties in unique/one-off products/services
• uncertainty of imputation models
• substitution bias and other issues related to Laspeyres index formula

Index figures are not subject to revisions.

Sampling error is always associated with sampling (as only one sample realisation from population is utilized). Sampling error can be measured with standard error - and confidence intervals. Confidence intervals have not been estimated for producer price index for services.

Scientific literature on indices often refers to the substitution bias that the Laspeyres’ index formula may create. The direction of the bias depends on the target of measurement. In the case of the Producer Price Index for Services, substitution bias may arise because when maximising their profits, enterprises react to changes in relative prices and shift the emphasis of their activity. Then an index calculated with the Laspeyres’ formula underestimates price development from the enterprises’ perspective. The significance of the substitution bias depends on the scale and speed at which individual enterprises are able to redirect their activities when relative prices change.

Fixed-quantity indices may contain a bias resulting from the entry of new products or services on the market and from that if strong changes take place in the service structures and weight relations between industries. When new services are mentioned reference is often made to data processing services the production and sales of which can grow quite rapidly in the course of a five-year time span. If there is vigorous change, an index may not describe accurately enough the average development in the prices of the services produced in the economy. However, the bias caused by new services is not that significant in practice, because a new service can be added to the ones monitored with the index if the volumes of its production and sales have increased significantly.

The objective of producer prices indices is to describe pure price development. Therefore, changes in the quality of products must be taken into consideration in their calculations. The problem of quality change is usually encountered either when a data supplier reports that a service or product on which data are collected is no longer produced, imported or exported, or that changes have been made to the service or product concerned. Qualitative changes and their treatment are among the main challenges in index calculations. In the Producer Price Indices for Services, changes in quality are controlled for with several methods.

In the first place, efforts are made to collect an overlapping price observation for the changed product. In practice, this means that as the product changes the price of the preceding period is collected in addition to the price of the reference period. This allows the change in price to be calculated and the price history stays unbroken despite the change in the monitored product. The idea of the method is based on an assumption of perfect markets and rational consumers: prices of similar services must be the same at a certain time point, or conversely, the price difference on the market indicates that the qualities of the services differ from each other. Because the services have been available on the market at the same time point, the price difference of the service must be equal to the quality difference, because buying of an overpriced service is not justified.

If overlapping observations cannot be obtained, in some cases the old price can be carried forward. The method is applied in the Producer Price Indices for Services only if the price of the service to be monitored is not obtained for some reason during the statistical reference quarter and the price development of the service product concerned is stable. If the data are not obtained in two successive quarters, the data supplier is requested to select in its place a new service product (case: a permanently missing observation). The price of a temporarily missing observation can thus be carried forward if it is a service with a stable price development. Permanently missing services are replaced with new service products.

Use of the following methods can also be optionally used in quality change cases:

• The quality of the changed product is assumed to be the same as that of the earlier product. In this case, the price change is allowed in the index as such.
• The price change is assumed to derive entirely from a change in quality, in which case the index does not change at all as the service changes.
• Quantity adjustment is used if the occurred price change derives fully or partially from a change in the quantity of the monitored service.
• An expert assessment where the data supplier is asked to assess which proportion of the price change is a pure change in price and which proportion is due to a change in the quality of the service. Then the impact of a quality change is eliminated from the price change. The expert assessment is based on the idea that the data supplier enterprise is best equipped to assess the price development and formation of its own service products.
• An expert assessment based on some other source. Discretionary changes may be made in certain cases to the index if more accurate information on the development of the price of an examined service is available from some other source. This may also be done if for some reason the employed method does not measure the realised development correctly, e.g. by ignoring some significant change that has taken place on the market.

Methodologies to control for changes in quality are constantly being developed and international guidelines and recommendations are taken into account when applying different methods.

Other factors that have a bearing on the precision of the index are the accuracy of the data on which the sampling frame and weight structure are based, possible errors in the reporting of individual data items, and non-response. The response rate reaches 85-95 %. Reminder calls and e-mails are used to maintain high response rate. On-line price data collection system is actively developed in order to reduce the response burden and obtain data of good quality. Double checks and error listings are used to avoid processing errors.

Indices are published 24 days after the end of the reference quarter, thus lag is 24 days.

No delays have occurred; indices have been published according to the prescheduled release calendar 

No geographical dimension; Finland as a whole

As a rule, STS time series start at 1Q/2005. However, some time series dates back to 1Q/2000.

On statistics concerning economical trends, Statistics Finland emphasises coherence between values, prices and volumes (V=P*Q). Especially focus is on the volume measures obtained from the volume index of industrial output and national accounts (trend indicator of output, quarterly and annual national accounts). Producer price indices (agriculture, industry and services) are utilised as deflators, thus compatibility is essential.

In Statistics Finland we have formed a deflation group whose main task is to ensure the coherence of deflators used in volume statistics and in national accounts.

Suspicious volume measures are checked, and data on values and prices examined in order to obtain correct estimates.

2021=100 and 2015=100 producer price indices for services aggregates are consistent in the aggregation. Starting from 2018, the producer price indices for services use annual chain-linking and the weights are updated every year. 

The backcasted 2010=100 index series for the years 2000-2009 are not consistent in aggregation due to a calculation method (chaining) that was utilized in backcasting. Backcasting was executed by taking the new base year index figures backwards with monthly changes. As a results, history is not “rewritten”: monthly and yearly changes correspond to once published figures. For example, 2010=100 series are backcasted with the 2005=100 monthly changes starting from 4Q/2009. However, because of chaining, backcasted sub-aggregates do not yield higher-level aggregates.

Hours spent on the compilation of producer price index at Statistics Finland is approximated (costs):

Producer price index for services = 605 h/year

Hours spent as respondents fill the PPI inquiries (burden):

Producer price index for services = 970 h/year

Staff, facilities, computing resources, and financing

At the end of 2023, Statistics Finland employed 777 persons. Staff-years totalled 735 in 2023, of which interviewers accounted for 91. The number of staff-years was 6 less than in the year before.

Statistics Finland's total operating costs amounted to EUR 67.7 million in 2023. Compensation of employees accounted for 70 per cent of all expenditure.

The total funding available to Statistics Finland was EUR 80.1 million. EUR 53.9 million were appropriated from the national budget for Statistics Finland's operating expenses. Appropriations carried forward from the previous year totalled EUR 11.8 million. Co-operation projects and external funding constituted other important sources of financing: a total of EUR 3.0 million were received from these. Revenues from charged activities totalled EUR 11.3 million. EUR 12.2 million of the appropriations were carried forward to 2024.

Ensuring efficient use of resources

The annual performance targets based on the strategic plan are set and followed according to a performance management system and scorecards. Performance agreements are made and followed both at the office level with the Ministry of Finance, and at the department level between the Director General and the directors of the departments. The full costs of compiling statistics, including staff costs and computers used, are measured.

A formal review of staff performance and competence is conducted annually in discussions with individual staff members (personal appraisal discussions).

Neither nationally published indices nor indices transmitted to Eurostat are subject to revisions. 

The same revision policy is applied to STS data released nationally and transmitted to Eurostat.

Release calendar is discussed in a chapter 8.1.

Nationally published Producer Price Indeices for Services and indices transmitted to Eurostat are not revised. Methodological changes are announced at the time of change; essential changes, such as changes in the classification, are informed beforehand on statistics' homepage.

Rebasing for the base year 2015=100

When rebasing statistics, a part of time series is re-calculated with updated weights. Hence index figures are "revised". For example, 2015=100 index was nationally introduced in the first quarter of 2018. Years 2015, 2016 and 2017 were calculated using a new set of weights and enterprises, and consequently, the results, quarterly and yearly changes, differed from 2010=100 results concerning years 2015, 2016 and 2017.

Backcasting is executed by taking the new base year index figures backwards with "old" quarterly changes. As a results, history is not "rewritten": quarterly and yearly changes correspond to once published figures. For example, 2010=100 series are backcasted with 2005=100 quarterly changes starting from 4Q/2009. However, because of chaining, backcasted sub-aggregates do not yield higher-level aggregates.

Rebasing for the base year 2021=100

With the annual chain index method, there are no revisions between base years 2015=100 and 2021=100. Time series until the beginning of year 2024 for the 2021=100 index are calculated by rebasing the 2015=100 index series.

Nationally published annual and quarterly change rates may differ by 0,1 percentage points between the base years due to calculation method: change rates are calculated from index point figures truncated to two decimal places.

The calculation of the Producer price index for services is based on a sample. The price data used to calculate the index are collected from enterprises drawn to the sample. This price index is considered as being descriptive of the average development in the prices of all services produced for enterprises, households and public sector. The group of service enterprises included in the Producer price index for services is checked annually. Smaller updates are constantly made to the enterprise sample, because changes take place in the activity of enterprises.

Statistics Finland’s Business Register and Statistics on service industry commodities are used as the sampling frame for the Producer price indices for services. The Business Register contains data on the industry and turnover of enterprises. The statistics on service industry commodities describe the structure of turnover and services produced in certain branches of industry providing business services. Industry-specific indices have been designed independent of each other and the used sampling method varies by industry. Depending on the industry, data suppliers have been selected by applying PPS (Probability Proportional to Size) sampling or judicious sampling, or by combining judicious and probability-based sampling. Services whose prices are followed quarterly are selected in co-operation with data providers. The objective is that the examined services would be as representative as possible and could be monitored as well as possible. The following criteria are used in selecting the services to be monitored:

• The service is as representative as possible. It generates a significant share of the enterprise’s turnover.
• The service describes as well as possible the average price development of the services belonging to the same service entity.
• A price concerning a certain unit (e.g. number or day) and quality can be quoted regularly by quarter (or less frequently) for the service. The price must be comparable between statistical reference periods.

The Producer price indices for services are calculated using over 22,000 price data items collected from approximately 2,400 data suppliers. The numbers of price data items and data suppliers vary by industry and index series (BtoB and BtoC).

The producer price data include a number of large data sets from enterprises, and price data for some product categories is retrieved from application programming interfaces (API). Large data sets and APIs are utilized especially in BtoC-prices, where data from the Consumer Price Index can be utilized. The number of data items above includes price data from APIs and excludes the number of observations of the large data sets; only the aggregates calculated from them are included. 

The Producer Price Indices for Services is published quarterly, which means that, as a rule, all prices are collected every quarter. Depending on the industry of the enterprise, the time of quoting the price may be the first, second or third month of the quarter. In industries with volatile prices, such as goods transport by road and sea, data are collected for the whole quarter. However, due to practical reasons when prices remain unchanged some price data are collected less often.

Since 2018 Producer Price Indices for Services have nationally been compiled on a monthly level, as well. The primary frequency of data collection for the enterprises which have been selected into the sample after 2018 is monthly. The share of price data collected less frequently than once per quarter is about 20 per cent in the Producer Price Indices for Services.

The data collection frequencies are examined regularly for each enterprise and product to ensure a balance between the quality of the indices and the response burden of the enterprises.

Price should be a quantity weighted average price for the reference period.

Producer price index for services staff carry out the price collection.

The price data for the Producer price index for services are collected mainly from enterprises through an online survey. Besides the data collected directly from enterprises, price data and point figures from the Consumer Price Index are also utilised in the compilation of the Producer price index for services. In addition, price data on office and business facilities are provided by KTI Property Information Ltd.

Depending on the industry, the time of quoting the price data collected from enterprises may be the first, second or third month of the quarter under review. In industries with volatile prices, such as freight transport by road and sea, collected are charged unit prices over the whole quarter under review.

The pricing method used in the Producer price index for services varies by industry and enterprise. The transaction price can often be used for identically repetitive services. For other services, the employed method could be based on a unit value, model pricing or the time used for producing the service.

Producer price index for services software provides relevant listings for monitoring the data collection.

Non-response rate varies between 5 to 15 per cent. Non-responders and inliers are studied on a regular basis in order to avoid systematic errors on results. Enterprise samples are updated on demand.

On the development of the online survey, focus has been on user-friendliness in order to reduce response burden and improve data quality.

Price data are further examined if

• Substantial month-on-month, quarter-on-quarter or year-on-year price change
• Variant’s any price-determining characteristic is changed
• Inconsistencies in a price development within same phenomenon (e.g. prices of legal services are not developing in a consistent manner between enterprises, or product category prices are not “well-behaving” within enterprise)
• Price has not changed for “a long time” (inliers)

When necessary, informants are contacted for further information.

Treatment of quality change

Primarily, efforts are made to collect an overlapping price observation for the changed product. In practice, this means that as the product changes the price for the preceding period is collected in addition to the price for the current period. This allows the true change in the price to be calculated and the price history stays unbroken despite the change in the monitored product. The price for the current period can concern the month or quarter and the preceding period refers to the preceding corresponding period. If overlapping price observations cannot be obtained, various pricing methods can be used to measure/assess the price change, such as model or component pricing.

Expert assessment can also be used to assess price changes. In this case, the responder is asked to assess which proportion of the price change is a genuine change in price and which proportion is due to the change in the characteristics of the product. The expert assessment is based on the idea that the data supplier enterprise is best equipped to estimate the price development of its own products.

If neither an overlapping price observation nor an expert assessment can be obtained and price measurement methods cannot be applied, the price development of the product is imputed with the average change in the prices of other products belonging to the same commodity group. The imputation is based on the assumption that the prices of products in the same commodity group develop in roughly the same way.

If none of the above methods can be used, discretionary use of the following methods is possible:

• The characteristics of the changed product are assumed to be the same as that of the earlier product. In this case, the price change is included in the index as is.
• The price change is assumed to derive entirely from a change in the characteristics, in which case the price change is eliminated, and the index does not change as the product changes.

Price measuring and methodologies to control changes in quality are constantly being developed and international guidelines and recommendations are taken into account when applying different methods.

STS validation levels 1 - 5

STS data transmissions to Eurostat are automated. IT software generates required .xml-files. Metadata part and content are examined before transmission to Eurostat.

All the validation concerning consistencies and plausibility of index figures is carried out - as well as all the information within and outside Statistics Finland is exploited - before .xml-files are generated and send to Eurostat.

The specific product group (CPA) indices of the Producer price index for services describe the average development of prices in the product group concerned.

Index calculation

Producer price indices for services are annual chain-linked indices. This means that weight structure is updated every year. In addition, product categories and enterprise sample may also be updated every year. Simultaneously, discontinued price quotations are removed from the data.

The calculation of the producer price indices as annual chain-linked indices is as follows

1. Enterprise-specific CPA product category indices, elementary indices, are calculated as a geometric average of the price ratios.
2. The elementary indices are weighted to the higher levels of the CPA product classification using the Laspeyres formula.

A change compared to the base index method is that while in a base index the price of today has been compared to the price of the base period, in an annual chain index the price of today is compared to the price of December of the previous year. The December of the previous year is the so-called chaining point for producer price indices. The point figure of the chaining period is carried forward with the change between the chaining period and the current period. This is done for every level of the index.

The individual products whose prices are monitored, or variants, reported by an enterprise do not have their own weights but the enterprise-specific CPA product category indices, or elementary indices, are calculated as the geometric average of the price ratios (=current price/price at reference period) of the products belonging to that category. The elementary indices are combined into an overall index with a weight coefficient corresponding to each product category and enterprise. In other words, price changes of individual products have different-sized effects on the overall index.

Weight structure

The weighting coefficients are based on data on the enterprises' turnover and their breakdown by the main service entities of each enterprise. The used data on turnover are either data reported by the enterprises themselves on turnover received from services within the industry concerned or data on turnover obtained from the Business register or from the statistics on service industry commodities.

Weights are based on National Accounts supply and use tables from 2020. Additional adjustments for weights were made separately for industries that were affected the most by the coronavirus pandemic. These industries were identified and adjustments were made with the help of data from the statistics on turnover of service industries. The adjusted industries included water transports, air transports, accommodation services, food services, and travel agency and tour operator services.

The specific product group weights have been formed by dividing first the total volume of service industries expressed in euros to the alphabetical main activity level, then to the 2-digit level and from there up to the 4-digit level according to relative use. Elementary level weights are formed by dividing each product groups' weight between the enterprises within the product group based on their relative turnovers. Finally, the weights are updated with SPPI to reflect prices of December 2022.

Treatment of non-response

Monthly non-response rate varies between 5-15 per cent. Non-response is low due to actively reminding data-suppliers to fill the survey.

On a monthly level, non-response is not treated. Additional data collection for the next month is assigned to data suppliers with large weights in the index if they failed to fill in the price survey according to their data collection frequency. Once per year non-response and inliers are contacted separately to update their contact information / update the products in the survey / remove them from the data collection if their production has ended.

Producer price indices are "pure" price indices, which are not affected by changes in the quality of the products/services. Efforts are made to eliminate from the index price changes that are caused by changes in quality. Both the "physical" and financial (such and conditions on financing, guarantee, whether product is sold or service produced to a wholesaler or retailer) characteristics of a product/service must remain unchanged. In practice, product/service characteristics change continuously. Quality changes and their treatment are among the main challenges in index calculations. In producer price indices, changes in quality are controlled for with several methods to make sure that the best possible method for measuring price change is always used.

Producer price indices are not calendar or seasonally adjusted. By examining yearly changes, "seasonal adjustment" is implicitly done as same quarters are compared.

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