Consulting Services Price Index (COSPI)

Detailed information for first quarter 2015

The Consulting Services Price Index measures quarterly price changes for various consulting services such as management, environmental, and scientific and technical consulting services.

Data release - May 13, 2016

• Questionnaire(s) and reporting guide(s)
• Description
• Data sources and methodology
• Data accuracy

Description

The Consulting Services Price Index measures quarterly price changes for various consulting services such as management, environmental, and scientific and technical consulting services. This price index is a useful indicator of economic activity in the consulting services industry, and can also prove helpful as a supplementary tool for performance evaluation, cost monitoring, contract assessment and benchmark comparisons. In addition, the indexes are used by the Canadian System of National Accounts to arrive at estimates of real value-added for the industry and to measure changes in productivity in this industry.

The data collected on this survey include the (average) invoiced rates (i.e. hourly/daily) for each company's various consulting levels (e.g. senior partner, junior consultant, associate, etc.) and the total amount of time invoiced for each level, over the course of the particular reference quarter. The consulting rates for each professional level are combined together into a company-level price index using the invoiced time as weights. The company-level price indexes are combined into an overall price index for the industry using the companies' relative revenues from consulting services as weights.

Statistical activity

These indexes are a part of the Services Producer Price Index program (SPPI) at Statistics Canada.

The SPPI program develops and produces price indexes for a wide range of business service categories. This initiative fills an important data gap in the area of economic statistics and has resulted in a more comprehensive set of service price indexes. It also allows Statistics Canada to produce more accurate estimates of real value added of the Gross Domestic Product and changes in productivity.

Reference period: The time period for which the index equals 100 - currently this is the year 2014.

Collection period: Collection begins one month after the end of the time period (i.e. quarter) to which the level of the price index refers. The length of the collection period is 60 days.

Subjects

• Business, consumer and property services
• Prices and price indexes
• Professional, scientific and technical services
• Service price indexes

Data sources and methodology

Target population

For the management consulting component of this survey, the target population consists of all businesses in Canada that engage in the provision and sale of management consulting services.

For the environmental, scientific and technical consulting component of this survey, the target population consists of all businesses in Canada that engage in the provision and sale of environmental, scientific and technical consulting services.

• Additional documentation

Instrument design

The questionnaire used for the COSPI was developed by subject-matter experts at Statistics Canada and tested in consultation with consulting firms across Canada and with the Canadian Association of Management Consultants (CMC-Canada).

Sampling

This is a sample survey with a cross-sectional design and a longitudinal follow-up.

For the management consulting component of this survey the sampling frame was built by combining the companies on Statistics Canada's Business Register (BR) that are primarily engaged in the provision and sale of management consulting services (those companies classified to either NAICS 541611, 541612 or 541619) with an inventory of management consulting companies provided to Statistics Canada by the Canadian Association of Management Consultants (CMC-Canada). The companies selected to participate in this component of the survey are based on the judgment of subject-matter experts. The sample size is 48 companies.

For the environmental, scientific and technical consulting component of this survey, the sampling frame consists of all companies on Statistics Canada's Business Register (BR) that are primarily engaged in the provision and sale of either environmental or scientific and technical consulting services (those companies classified to either NAICS 541620 or 541690). The probability of a company being selected to participate in this component of the survey is proportional to its revenue. The sample size is 75 companies.

Data sources

Data collection for this reference period: 2016-01-29 to 2016-03-18

Responding to this survey is mandatory.

Data are collected directly from survey respondents.

Data are collected via electronic questionnaire (EQ).

The questionnaire asks respondents to provide a list of the professional consulting levels whose time was billed to consulting services during the particular reference period. Respondents also provide the (average) invoiced rate and the number of hours invoiced for each consulting level. The average rates for each consulting level are combined together into a firm-level price index using the number of hours for each level as weights.

During the collection process, an interviewer may contact the respondents by phone when questionnaires are overdue or when responses require clarification. In the case of late respondents, several follow-up contacts can be made including sending out a reminder letter and/or e-mail to obtain their response.

Company-level weights are obtained based on revenue information found on Statistics Canada's Business Register (BR).

View the Questionnaire(s) and reporting guide(s) .

Error detection

A set of systematized error detection procedures are in place to identify outliers and possible reporting errors. For example, a larger than average increase in the average charged rate for a particular consulting level between two consecutive reporting periods will trigger a follow up with a respondent.

Imputation

Missing data are generally estimated by a systematized imputation process. In any given period, price data may not be available for estimation. In such cases, missing data are imputed using the average price movement of remaining units within the same stratum (overall mean or targeted mean imputation method).

Estimation

Prices

The prices collected for the Consulting Services Price Index are defined as the average invoiced consulting (hourly/daily) rates for various professional consulting levels reported for each company.

Weights

The company-level price indexes are a weighted average of the average invoiced consulting rates for various professional levels reported for the company. The weight for each professional level is the total amount of time billed to consulting services for that level. The company-level price indexes are combined into an overall price index for the industry using their relative revenues as weights.

Estimates are produced by calculating a weighted average of price relatives by industry, which are chained together to form an index series. The COSPI is a Laspeyres chain linked index, available at the Canada level only.

Quality evaluation

The data is subject to collection and processing validations on all key variables and most non-essential data. Analysis is also performed at the index level at various aggregation stages. Quality evaluation is achieved using an internationally developed services producer price framework that considers aspects such as the type of price being used, timeliness and relevance.

Disclosure control

Statistics Canada is prohibited by law from releasing any information it collects which could identify any person, business, or organization, unless consent has been given by the respondent or as permitted by the Statistics Act. Various confidentiality rules are applied to all data that are released or published to prevent the publication or disclosure of any information deemed confidential. If necessary, data are suppressed to prevent direct or residual disclosure of identifiable data.

Collected data are converted to price indexes and data are released as such, so that it is not possible to identify the suppliers of raw prices.

Data accuracy

The survey achieves a response rate of approximately 80% and uses a methodology designed to control for errors and reduce their potential effects on estimates. However, the survey results remain subject to both sampling and non-sampling errors. Sampling error results when observations are made only on a sample and not on the entire population. All other errors arising from the various phases of a survey are referred to as non-sampling errors. For example, these type of errors can occur when a respondent provides incorrect information or does not answer certain questions; when a unit in the target population is omitted or covered more than once; when an out of scope unit is included by mistake or when errors occur in data processing, such as coding or capture errors.