Labour Market Statistics User Group

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The Labour Market Statistics User Group (LMSUG) is a forum for sharing how members use Labour Market data and presenting/discussing topical issues.
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1.  UK Employment Trends

Posted 23-10-2013 15:05
This message has been cross posted to the following Discussions: RPICPI User Group and Labour Market Statistics User Group .
Hi All

I am usually to be found on this site on the RPICPI User Group but wish to gather some thoughts and hopefully the members of this sub-group's insight on some new data on the UK employment numbers.

The essential point is this which I have posted on my Notayesmanseconomics blog today. It concerns job or employment growth in the UK since 2010 and some new analysis from Chris Williamson.

"An alternative view

Using three private sector surveys (from Markit's PMI data,the British Chamber of Commerce and the KPMG/REC survey of the recruitment industry) we get much lower job creation estimates. These are reasonably consistent and suggest we have had 258,000, 308,000 and 174,000 jobs created since the second quarter of 2010 which means this.

The results (table 1) show that the ONS‟s LFS estimate of a 1,168k increase is 921k higher than the average of the survey based estimates.

That is quite a gap and it poses substantial questions for both our economy and our central bank which has tied its policy to the labour market."

As you can see the new research gives quite a different pattern to the UK over the past three years with considerable implications for our economy and how it should be managed (hence the Bank of England reference).

So any thoughts?

I have cross posted this to the RPICPI User Group too as it has possible implications for it as well.


Shaun Richards

2.  RE:UK Employment Trends

Posted 23-10-2013 15:22
Hi Shaun

Has been some twitter discussion as well.

Most of the people over here are used to administrative data, which measures 100% of whatever it measures (a moveable feast) and household surveys.

Business surveys are a bit of a dark art which aren't as well documented as the Labour Force Survey.

Are there reasons not to trust the LFS? @D_Blanchflower points out that most countries have a sample large enough to deliver single month estimates, whereas ours are QA to 3-month moving average. Sample response has been decreasing, but the sample frame is well-understood and continually updated. Weighting is to Census-based population projections. Datasets available from Data Archive if you want to play with the data (I do).

Generally, highly trustworthy. Some dodgy bits. Counting 165,000 Government programme participants as in employment is particular bugbear (as the nature of the programmes means jobsearch and availability are redoubled above the ILO unemployment criteria).  10 volumes of manual and quarterly performance reports on the ONS website.

Business surveys from ONS, sample frame updated annually in arrears. Weighting? We know stratified random sample. Manuals? Data available from data archive? Not usually, because of collection under mandatory powers.

My worry is that recessions (and this one, with zombie firms, may be less affected) with high rates of business deaths, births and mergers, will cause the business sample frame to drift much more than a household sample frame.

So why should we believe the business survey based estimates?

Paul Bivand

Associate Director of Analysis and Statistics

3rd floor, 89 Albert Embankment, London SE1 7TP

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 See Inclusion's for the latest news and opinions in welfare to work

3.  RE:UK Employment Trends

Posted 25-10-2013 11:32
Hi Shaun

Far be for me to defend ONS stats - I usually spend my life explaining to anyone who will listen how problematic most of them are! However, in this case, aren't we comparing apples with pears?

Assuming we are talking about the normal LFS, this is a residents based survey (some workplace stats are available though), whilst the other surveys  you mention are of businesses. The LFS doesn't say anything about jobs, it has data on people who say they are employed. There is a difference.

Also, worth pointing out that the LFS results you quote were for people employed in the private sector  However, if the main source of data on jobs (the ONS BRES survey) is anything to go by, the number of public sector jobs is falling, thus the number employed in the public sector is (probably) falling, counteracting any stimulus from private sector growth. 

Business Surveys? I'm a cynic, but I see reports in the press on some variety of business surveys almost every day. Some say business is booming, some say confidence is falling, some say our region's bad, but hasn't had quite as bad a time as some other regions etc etc. We frequently find that surveys published in a month can give entirely opposite results. If I want to find out whats happening in the local economy, I rely on statistics. Even ONS statistics - but not on businesses surveys. Lets be frank, some of these surveys are intended more as marketing material than research. Talking to businesses is a useful approach, and something I'd like to do more of to get an understanding of the real economy. However, its not straightforward. Each firm is different and has their own completely individual perspective and you must be very careful about making general statements from small samples.

Tim Bounds
Tees Valley Unlimited


4.  RE:UK Employment Trends

Posted 25-10-2013 13:47
Worth adding that most business survey data available at sub-national level is incredibly slow.

ONS has just published 2012 numbers for the Business Register and Employment Survey.

The UKCES has released some data (via lmiforall) from the 2011 Employer Skills Survey.

The Markit/REC Report on Jobs has 4 regions plus Scotland separately. That's current, but the regions are large (and don't match with other geographies).

The lack of timeliness is one reason why local users don't engage much.

Local authorities do use BRES a lot - though I've never been quite clear why - the employment numbers are workers not residents/voters. And, at local level, you don't get turnover.

Paul Bivand