Understanding the Nomenclature of Territorial Units for Statistics (NUTS)

The NUTS classification of areal units represents an attempt to present statistical information for standard sets of geographical areas across the whole of the European Union (EU). It is not a practical proposition for each country within the EU to discard its own locally established areal units, which may have deep historical roots and be intrinsically related to the organization of local government, in favour of a single centrally-imposed geographical hierarchy. It is also impractical for each country to maintain statistical information for both its own system of areal units and an additional incompatible set. The NUTS approach is therefore to classify the areal units used by individual countries into a series of levels, each of which provides a broad degree of comparability across the EU.

The key purpose of the NUTS areas is to provide a framework for the collection and publication of standardized statistical information, which is used both for analysis and as the framework for European policy initiatives. For example, regions identified for particular assistance under EU structural funds will not be selected on an ad hoc basis, but will correspond to specific regions in the NUTS hierarchy. Many different datasets relating to NUTS areas are published by Eurostat, the Statistical Office of the European Communities.

The NUTS classification is primarily based on the adoption of areal units from political and administrative systems (such as local government areas) rather than analytically-derived units (for example, travel to work areas). Further, NUTS seeks to avoid the use of geographical areas which have only one purpose or are related to only one type of economic activity. A consequence of this approach is that there may be significant variation between the size and nature of NUTS areas at the same level, both within and between countries.

NUTS provides a hierarchical subdivision of geographical space, identifying areas at a series of nested levels, with NUTS level 1 being the largest units, typically regions in the range 3-7m population, NUTS 2 being in the range 800,000-3m population and NUTS 3 in the range 150,000-800,000 population. The exact relationship between the NUTS areas at a given level and the local administrative structure varies between countries and may be complex. At the local level, two levels of Local Administrative Units (LAU) have been defined, which were previously referred to as NUTS levels 4 and 5. However, units at these levels have not been defined for every member country of the EU.

Example

The following example illustrates the outworking of the NUTS with reference to an example in England, drawn from an area with both county- and district-level local government.

In this example, NUTS level 1 corresponds to the South East Region (formerly a "Government Office Region" until 2011) and takes the code letter J which is also used within the UK. NUTS 2 corresponds to groupings of counties and local authorities which have no direct equivalent in UK administration and for which there are no equivalent codes - in this case, the combination of Hampshire and the Isle of Wight. NUTS 3 corresponds in this case to the county of Hampshire, although the NUTS code is not the same as the national code. LAU level 1 is in this case the non-metropolitan district of Test Valley and the national code is used for this. LAU 2 corresponds to the Blackwater ward and again the national code is used. It should be noted that there is no official equivalent within the NUTS hierarchy of the census output area, which is a further subdivision of the wards within this English example. A further complexity is introduced where the local government hierarchy does not correspond to the NUTS hierarchy. For example, English unitary authorities such as Southampton, which administratively span both county and district levels, are used at both NUTS 3 and LAU 1 and will be assigned a NUTS 3 code.

By extension, it is apparent that across Europe, there is some inevitably awkward matching between national administrative divisions and the NUTS scheme with, for example, Luxembourg appearing at the country and at NUTS levels 1, 2 and 3.