Informatics professional services price indexes (IPSPI)

Detailed information for 1999

Status:

Active

Frequency:

Annual

Record number:

2333

The Informatics Professional Services Price Index (IPSPI) collects financial, wage and contractor fee information that is used to produce price indexes measuring changes in prices for informatics professional services.

Data release - December 13, 2001

Description

The Informatics Professional Services Price Index (IPSPI) collects financial, wage and contractor fee information that is used to produce price indexes measuring changes in prices for informatics professional services such as hardware and software consultancy, computer facilities management, and system maintenance.

The IPSPI series is a useful indicator of economic activity in the informatics 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 output for the industry through deflation.

Subjects

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

Data sources and methodology

Target population

Under the North American Industry Classification System (NAICS), this industry consists of establishments primarily engaged in:

NAICS 541510: Computer Systems and Related Services (includes computer information technology consultants, development of custom software, systems and network design, systems development and analysis, computer programming to meet a customer's specifications).

Instrument design

The questionnaire used for the IPSPI was developed and tested in consultation with numerous respondents and experts in the informatics services industry.

Sampling

This is a sample survey with a longitudinal design.

Institutions are selected from the list of companies in the Business Register (Central Frame Database).

The survey frame includes all institutions that have the following activity:

- Computer Systems and Related Services (No. 541510 of the North American Industry Classification System - NAICS)

All establishments are stratified geographically to ensure selection from each province/territory.

Institutions are selected through a probability sample survey proportionate to the significance of their operating income and based on the region they are located in.

In order to Maximize the coverage of activity (Gross Business Income) in NAICS 541510 by province, we have used a minimum cut-off of 50% of GBI for each province. Under this cut-off, the number of units selected for any one province will depend on the size distribution of units in the province.

Data sources

Responding to this survey is mandatory.

Data are collected directly from survey respondents.

Respondents receive the questionnaire by mail. Contacts with the respondent take place when questionnaires are late or the responses provided require clarification. In the case of late respondents, several follow-up contacts can be made including sending out a reminder letter in order to obtain their response.

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 or decrease in one of the items collected will trigger a follow up with the respondent.

Imputation

This methodology does not apply.

Estimation

We use the following procedure to estimate indices:

- We estimate indexes for labour cost and ratios separately based on matched models. To estimate a labour cost relative for each firm, we calculate a weighted geometric mean of its contract fee and wage rate relatives where the weights reflect the proportion of labour expenses in the base year accounted for by each type of labour for the firm. Labour cost relatives is estimated by strata (take-all and take-some) using a weighted geometric mean of the labour cost relatives for all firms. The weights reflect the probability of being selected in the sample. The price relatives for each strata are combined in weighted geometric mean where the weights reflect the share of all units above cut-off on the frame that fall within each strata. We link each year since the number of matched observations varies significantly through time given our poor response rates.

- The realized net multiplier or ratio index is calculated in two stages. First we estimate a weighted geometric mean of matched ratio observations for each strata (take-some, take-all). Then we calculated a weighted geometric mean of the means for each strata where the weights reflect the importance in terms of proportion of total revenue of all units above cut-off in the frame represented by the take-all and take-some strata.

Quality evaluation

The quality of this index is maintained through the expertise of the few trained analysts assigned to it. They develop a thorough knowledge of the domain, which is supplemented by outside personal contacts for particular goods or services. Much time and effort is devoted to detecting and following up unusual fluctuations over time in the pricing patterns of goods and services. Prior to dissemination, the price indexes are analyzed and historic trends reviewed.

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.

Revisions and seasonal adjustment

The most recent two years of published indexes are subject to revision.

Data accuracy

The statistical accuracy of this index depends on price and weight data. Price data are obtained from a sample survey and the weight information is obtained from Statistics Canada's Central Frame Database. Both kinds of input data are subject therefore to their own errors. The quality of the price data rests on the response rate. In this regard, the quality of the price information is judged to be good, as the response rate is about 79%.

Though the IPSPI uses a sample survey methodology to obtain the necessary information, confidence intervals are not currently estimated, due to the longitudinal nature of price index series. Indexes for higher and lower levels of aggregation are considered to be statistically reliable.

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