Policy paper

Industrial Strategy economic indicators methodology note, July to September 2025

Updated 13 October 2025

The Office for National Statistics (ONS) produces granular sector data on an annual basis. To provide more timely data, the Department for Business and Trade (DBT) created a methodology using more aggregated quarterly data to estimate quarterly investment, employment, productivity and GVA (gross value added) for the Industrial Strategy growth-driving sectors (the ‘IS-8’ sectors).

Quarterly data is inherently volatile, and the granular estimates are likely to see notable revisions once the official annual data is released. Revisions will be more significant where the sectoral proportions of the economy shift significantly. Estimates may also be revised as DBT methodologies and data sources improve over time.

Estimating quarterly economic indicators for the IS-8

The IS-8 cannot be precisely mapped and measured by official statistics. ONS economic data uses the Standard Industrial Classification (SIC) system, which does not fully capture the detail and fast-changing nature of the IS-8, meaning coverage varies across them (see Table 1). See initial definitions for the IS-8 on the SIC, which we will continue to use as our starting point.

Table 1: SIC-based definition coverage across the IS-8

Advanced Manufacturing	Clean Energy Industries	Creative Industries	Defence	Digital & Technologies	Life Sciences	Financial Services	Professional and Business Services
Proxy SIC-based definition	Not easily represented by SIC, with no or partial coverage	Well defined by SIC	Not easily represented by SIC, with partial coverage	Proxy SIC-based definition	Not easily represented by SIC, with partial coverage	Well defined by SIC	Well defined by SIC

The SIC system is tiered, with increasing granularity down from SIC-1 to SIC-4. Where feasible we have mapped detailed SIC-4 against IS-8 sectors. The higher-level SIC classifications (that is, SIC-2) lack the necessary granularity to map easily against the IS-8, so we have used a list of SIC-4 codes mapped against IS-8 sectors to extract economic metrics.

Clean Energy cannot be proxied at all under the SIC system and is not captured here. Defence and Life Science only have partial coverage. Thus, overall IS-8 estimates will not fully reflect all 8 sectors. Estimates are at the IS-8 sector and not the frontier industry level for all frontier industries outlined in the Industrial Strategy white paper.

Table 2: Data underpinning each economic metric

Metric	CEI	AM, CI, D, D&T, LS, FS, PBS*
GVA	Not applicable	ONS GDP low-level aggregates (apportioned with the Annual Business Survey
Business investment	Not applicable	Industry-level data taken from ONS Gross Fixed Capital Formation by Industry and Asset, Volume Index Capital Services (VICS), supply and use tables, and business investment by industry and asset** (apportioned with the Annual Business Survey)
Employment	Not applicable	Payrolled employees from Pay As You Earn (PAYE) Real Time Information (RTI) (apportioned with Inter-Departmental Business Register (IDBR)
Output per worker	Not applicable	ONS GDP low-level aggregates divided by ONS productivity jobs (apportioned using Annual Business Survey proxy)

*Clean Energy Industries (CEI), Advanced Manufacturing (AM), Creative Industries (CI), Defence (D), Digital and Technologies (D&T), Life Sciences (LS), Financial Services (FS), Professional Business Services (PBS)

**Coverage varies between ONS investment datasets so we use multiple sources and merge them together to give full coverage.

DBT is publishing estimates of these 4 metrics to have a more timely understanding of how the IS-8 sectors are faring. However, the relevant data sets are published at SIC-2 level, which is not granular enough to extract data on all IS-8 sectors – which are defined at SIC-4 level.

Financial Services and Professional Business Services can be directly mapped at SIC-2 level and is directly input to the quarterly summary figures. But where this mapping is not feasible at SIC-2, we use apportionment to disaggregate the SIC-2 level economic data to the SIC-4 level data using another data set that does provide data at the SIC-4 level (ONS’s Annual Business Survey or the Inter-Departmental Business Register).

For output per worker data, we use the sector GVA data calculated using the apportionment method and divide this by ONS productivity jobs figures. The apportionment for ONS productivity jobs uses the same method as the GVA breakdown, using the latest Annual Business Survey (Non-financial business economy, UK: Sections A to S, 2025). This keeps the methodologies for the numerator and denominator consistent.

We use 2022 prices for GVA, investment and output per worker because this is the Chained Value Measures base year in the ONS GDP low level aggregates dataset.

For more timely employment statistics, we use Pay As You Earn Real Time Information (PAYE RTI) to source monthly employment. We use the latest available Inter-Departmental Business Register data (2024) to source SIC-4 employment shares for the IS-8, which are then applied on to the latest monthly PAYE RTI data.

DBT will update these estimates in future quarters with historic actuals and new sector mixes when more accurate or recent data is published by ONS.

Major new investments made in IS-8 sectors

The quarterly update summarises the major investments in the IS-8, and their related job numbers. These are listed in the accompanying Investment totals spreadsheet. We have recorded investment projects where government has been involved in the process or stem from policy decisions made as part of the Industrial Strategy. The figures are the nominal value over the lifetime of each investment.

Where announcements are updates from commitments made before publication of the UK’s Modern Industrial Strategy, we record the net increase and exclude the previously committed value. The first quarterly update (July to September 2025) captures the investments announced since the Industrial Strategy white paper was published and thus includes some announcements in June 2025. The next quarterly updates will only capture the announcements made in the relevant 3-month period.

Notes on specific quarterly updates

Industrial Strategy quarterly update: July to September 2025

About £28 billion in infrastructure financing was raised between January and August, including M&A (mergers and acquisitions), with the UK on track to raise a record of more than £42 billion by the end of the year.^{[footnote 1]} This statistic refers to debt issuances for infrastructure deals, mergers and acquisitions, and refinancing.

1. Data originally reported in US dollars, converted at $1.36 per £1. Original data by Infralogic, reported by the Financial Times (paywall) on 8 September 2025. ↩