EU exit brought significant uncertainty for the UK economy. Policymakers needed immediate information about what British businesses were thinking and planning, rather than months-old business accounts or backward-looking surveys they had relied on before.
To meet this need, the DMP was established, providing near real-time data about business activities and the future expectations and confidence of UK companies during this period of uncertainty.
Now one of the country’s largest business surveys, the DMP has become an essential resource for the Bank of England and central government departments. It now supports decisions related to:
- interest rate setting
- taxation
- minimum wages
Its timely and reliable insights help to guide policy through turbulent economic periods, from the pandemic to the inflation surge.
A forward-looking survey
The DMP is a monthly online survey of more than 10,000 senior finance officers from UK businesses across a broad range of industries. It was co-created in 2016 by Professor Paul Mizen, King’s College London, and colleagues at the Bank of England and Stanford University, supported by Economic and Social Research Council (ESRC) funding.
Unlike traditional surveys, the DMP is forward-looking. It asks business leaders not just about what’s happening now, but what they anticipate will happen in the months ahead. By asking about expectations and uncertainty around them, it gives policymakers a clear window into business confidence and plans.
Professor Mizen said:
Official statistics tend to record what has happened in a business, such as turnover and profit. But when it comes to making decisions that affect the economy, whether that’s interest rates or budget decisions, you need information on what is most likely to happen in the future.
Measuring uncertainty
The DMP was initially developed in response to the EU exit vote, when the UK faced economic conditions that were unknown and unprecedented. The DMP team devised a unique mechanism to measure how important EU exit as a source of uncertainty was for their business.
Professor Mizen said:
We developed a four-point scale, from ‘not important’ through to ‘most important’, to get an indication of how uncertain businesses were about the impact of Brexit processes. For example, how it might affect their prices, levels of employment or decisions to invest.
Responsive design
In February 2020, with further ESRC funding, the DMP shifted its focus to tackle the even greater uncertainty caused by COVID-19. The fast pivot was made possible by the survey’s adaptable design. Every month, businesses answer a core set of questions about sales, investment and employment, but the survey also includes new questions that address current events as they emerge.
This flexibility meant the team were able to respond to COVID-19 within a month, providing crucial data to government that informed the design of furlough, business bounce back loans and other measures to protect businesses and jobs during the pandemic.
Professor Mizen said:
The survey is continually evolving. Sometimes questions are suggested by the Treasury or Monetary Policy Committee members, but the majority are devised by academics, who work closely with policymakers to make sure the survey asks what matters most at that moment. It means when events happen that create uncertainty, we’re able to respond with appropriately designed questions that provide valuable data to those making decisions.
Quick and reliable data
Results from the online survey are collected and analysed within days, providing close to real-time data. Another strength is the accuracy of predictions from such subjective questions. Ten years on, the DMP has built a wealth of data that is drawn on by both policymakers and, increasingly, the financial sector.
Professor Mizen said:
DMP data is essentially advanced warning of what official statistics will likely reveal later on. For example, when we compare estimations of sales growth rates against the accounts submitted to Companies House a year or more later, we find they are very closely related. This reliability is one of the reasons the Bank of England and policymakers have such confidence in it. It also means the City is increasingly paying attention to the data to try to anticipate the next steps of the Monetary Policy Committee.
Guiding interest rate decisions at the Bank of England
The Bank of England’s Monetary Policy Committee (MPC) draws on DMP data to guide its decisions, especially in times of rapid change. During the post-pandemic surge in inflation, for example, the DMP’s data on business uncertainty and price expectations proved invaluable. The MPC could see how firms were responding to rising costs and anticipate what might come next. This has helped the bank identify early signs of inflation pressure.
MPC panel member Catherine Mann said:
When I look at the Decision Maker Panel, I focus on the full range of responses firms give about future price and wage increases. The spread of those expectations, rather than just the average, gives me early insight into the pressures building in the economy. Those distributions have been an essential part of how I assess inflation risks and understand the uncertainty firms are facing.
Providing economic insights
According to Andrew Bailey, Governor, Bank of England, DMP data is discussed in almost every meeting of the MPC (PDF, 112KB). They also feature regularly in the minutes from those meetings, the quarterly Monetary Policy Report, and in speeches by MPC members.
Since the MPC started providing a rationale for their interest rate votes in the minutes, the DMP has been cited directly as an influence on the outcome.
Andrew Bailey, Governor, Bank of England said:
The results from the DMP are very highly valued by policymakers at the Bank of England. They provide unique insights that help us to understand what is currently happening in the economy and what businesses expect for the coming year. In particular, the granularity of the data that businesses provide, and the fact it is available in close to real time, is something that is not available from other sources.
Exploring the impact of minimum wage increases
The Low Pay Commission turned to the DMP for research on the impact to businesses of national living wage and national insurance contribution increases. The DMP team added questions about how firms intended to respond to the increases and analysed past wage data. Their analysis, which revealed higher wage growth in businesses with greater proportions of staff working at the national living wage, informed both Low Pay Commission policies and Bank of England decisions on interest rates.
Tim Butcher, Low Pay Commission said:
The commissioned research using the DMP enabled us to address questions that we would not be able to do using other data sources available to us. It also provided us with much more timely analysis than is usual when looking at firms. In particular, it has helped our understanding of the impact of the changes in employer NICs and increases in the NMW which were implemented in April. The data was very timely.
Providing evidence for government planning
The DMP makes a significant contribution to policymaking in the UK helping understand the implications of tax policies. While the panel has been running, the evidence it collects has been used to brief civil servants in departments including:
- HM Treasury
- the Department for Business, Energy and Industrial Strategy
- the Cabinet Office
- Cabinet Office Briefing Rooms
- the Office for Budget Responsibility
The DMP data contributed to key government decisions about capital allowances and business support schemes in response to economic shocks, such as during the pandemic. More recently, the DMP team conducted research into the lasting impact of EU exit on the economy, which highlighted the impact of uncertainty on businesses.
In acknowledgement of his services to economic research and public policy, Professor Mizen was awarded an OBE in the King’s New Year Honours in 2026.
Insights for the financial sector
The DMP has become an increasingly valuable resource for the City of London and financial analysts, offering insights into business sentiment and expectations. Banks, investors and advisers use DMP data to spot emerging trends, helping them to make informed investment and business decisions. Major firms such as Nomura, Pantheon and the Institute of Directors have highlighted the growing value of the DMP as a public data asset.