National Accounts and Employment Data

Group of Experts on National AccountsGeneva 25-28 April 2006

bth@dst.dk

Purposes of employment data in the national accounts

• Consistency checks (use of all available information in the NA compilation)

• General user interest in reconciliation between NA labour inputs and basic labour market statistics.

• Produktivity analysis• Employment effects (such as input-output

impact analysis)

SNA Chapter XVII Population and labour Input

Population and labour measures

Stocks (number of persons, point in time)• Population• EmploymentTransactions• Jobs (average end of quarter/month)• (Full time equivalent employment) • Total hours worked during period

(possibly broken down by educational level etc.)

Major sources for employment data in national accounts

• (Population census)• Labour Force Surveys (LFS)• Enterprise/establishment based

surveys• Register based employment

statistics------------------------------------------• Labour accounting systems

Problems in compiling employment data

• Definition of employment (ILO)

• Classifications by economic activity

• Economic units

• Informal economy

• Globalisation

General observations on LFS

• LFS (with certain adjustments) as the overall benchmark for employment in the eoconomy.

• Only the LFS measures hours worked• The classification by economic activity in

the LFS is not reliable enough (sample size, classification method) for direct use in the national accounts. (Overruled by establishment surveys/administrative data and other)

Adjustments of employment data to national accounts concepts

Adjustment of total:• Net non-resident employees (national vs.

domestic) • Hidden economy

Reallocation by economic activity (neutral)• Alternative sources by economic activity• Special NA activity classification• Adjustment to compensation of employees• General reconciliation algorithm

Hidden economy and employment

Figure 1 Hidden economy

Hiddeneconomy

More employedpersons

More hoursworked

No more employedpersons

No more hoursworked

Special NA economic activity classification

”Pure” activities in national accounts such as for example:

• Agriculture• Construction• TradeEmployment must be reclassified to

be consistent with the economic activity classification.

Other classification issues

• Ancillary corporations (SNA 4.40-44) created specifically to employ all staff of a parent corporation

• More generally labour contracting activities (belonging to the ISIC group ”Labour recruitment and provision of personnel”)

Questions

• Preliminary vs. final data (annual and quarterly)

• Transparency and the reconciliation process. (Micro-macro links?)

• Restrictions on the concialition process (on increases in hourly wages and/or labour productivity etc.)

Reliability of estimates by industry

Variable Coefficient of variation

Output 1 per cent

Intermediate consumption 2 per cent

(Assumed correlation between output and intermediate consumption 0,5)

Employment 1 per cent

Prices 1 per cent

Increase in labour productivity between period 0 and period 1

95 per cent confidence interval:

Plus/minus 5 percentage points

Questions on Russian estimates

• Restrictions on the reconciliation process (using the three sources: LFS, establishment surveys and administrative registers)

• Employment data used to estimate production in branches dominated by small enterprises

• Labour productivity: Trends, but not levels• ”Pure” types of activity (product groups)• Labour productivity per unit of output by ”pure”

types of activity. For assessing industrial labour requirements.

Questions on the Canadian estimates

• Restrictions build into the multistop reconciliation algorithm (using the three sources: LFS, establishment surveys and administrative registers).

• How are the variance estimates (sampling and non-sampling errors) made?

• Interpretation of the levels of labour productivity• Use of LFS data in construction, retail trade and

hotels and restaurants (in spite of lack of precise industry code) to capture clandestine work.