Apparent Domestic Market
Business Demographics provides a crude estimation of the Apparent Domestic Market size for selected classifications at the 2-digit level only, where market size is the value of local sales, measured as follows:
Value of local production less exports plus imports
Alignment of trade data (HS codes) and output data may not be exact, particularly for industrial activities which are predominantly processes and do not result in tradable manufacturing outputs. Some industry classifications are also excluded. Also problematical in comparing trade and output data are the not uncommon bilateral asymmetries in trade data (both in goods and services). These trade asymmetries occur when the reported exports from country A to country B do not match the reported imports to country B from country A.
Net Operating Surplus in national accounts is conceptually similar to corporate profits (or net income) but excludes non-production income such as realised capital gains, property income, etc. The available data can thus be used to estimate Industry Profitability for selected ISIC classifications.
Value added = Employee Compensation + Taxes less Subsidies on Production + Gross operating surplus
Gross operating surplus = Net operating surplus (Corporate Profit) + Consumption of fixed capital
Hence, Total Value Added is closely approximated by the compensation of employees + earnings before taxes. Hence, an estimate of pre-tax industry profitability can be calculated as follows:
Industry profitability = Value Added less Wages & Salaries