Demand (I-O)

Demand is an estimate of the amount of goods and services that all industries require from a given industry, whether domestic or international, in order to remain in operation. The value is calculated based on industry purchases across the nation, measured in terms of sales. Industry wages, taxes, and other values added payments are indirectly part of the demand through the production of the supplying industry. It is not possible to know the proportions into which demand should be broken out into categories such as wages, taxes, etc., but it is assumed that demand includes those categories.

Demand is measured in terms of sales. Demand is not the same as sales, however. Rather, it is an estimate of what industries need. Sales is a measure of what industries actually buy or sell. We use average purchases across the nation to estimate what an industry needs, on average, in order to remain in operation; the unit of measurement for demand is still sales, however.