ILO Department of Statistics Measuring Decent Work through labour force surveys Elisa M. Benes Household Surveys Unit ILO Department of Statistics Email:

ILO Department of Statistics

Measuring Decent Work through labour force surveys

Elisa M. BenesHousehold Surveys Unit

ILO Department of StatisticsEmail: [email protected]

Workshop on Challenges and Strategies in Improving Labour Statistics in Africa

Bamako, Mali (22-24 November 2010)

ILO Department of Statistics 2

Contents

• Labour force surveys relevance & topic coverage• Decent work indicators measurable through household

surveys• Informal employment• Labour underutilization• Periodicity of data & labour force survey arrangements• Current ILO activities


LFS relevance & topic coveragePEOPLE

•Age/Sex•Marital status•Education

HOUSEHOLDS•Size/Composition•Income/benefits•Location

EMPLOYED (all jobs)•Branch of economic activity•Occupation•Institutional sector•Status in employment•Contract characteristics•Informal employment•Informal sector employment•Working time (usual & actual hours)•Time-related underemployment & other inadequate employment•Income from employment•Employment-related benefits•Social dialogue

UNEMPLOYED•Search methods•Duration•Qualifications•Previous work exp.•Characteristics of last job•Receipt benefits

NOT IN LF•Reasons•Desire to work•Availability•Job search•Qualifications•Previous work exp.•Characteristics of last job•Receipt benefits

Current activity status (in the reference week) of working age population

Best source of information about the Economically Active Population -One single source for Working Age Population (WAP) -All types of workers, jobs, branches of economic activity -Flexible, detailed probing permits precise measurement


Decent work indicators measurable through household surveys

• More than half of the Decent Work indicators have as main source a household survey (Labour Force Surveys, Labour Force module, or child labour survey)

– Main indicators: 12 out of 18 indicators

– Additional & future indicators: 16 out of 29 indicators

• Household surveys are also an important source of contextual indicators

– 5 out of 11 indicators


Decent work indicators measurable through Labour Force Surveys

Main indicators• Employment-to-population ratio• Unemployment rate• Youth not in education & not in

employment• Informal employment• Low pay rate• Excessive hours• Child labour*• % employed in precarious work• Occupational segregation by sex• Female share of employment in ISCO

groups 11 & 12• % pop. 65+ benefiting from a pension• Union density rate

Additional/future indicators• Labour force participation rate• Youth unemployment rate• Unemployment by level of education• Employment by status in employment• % Own account workers & contributing

family workers in total employment• % wage employment in non-agricultural

employment• Labour underutilization• Employees with recent job training• Usual hours worked (hour bands)• Rate of time-related underemployment• Number/wages of casual/daily workers• Gender wage gap• Share of population covered by (basic)

health care provision• Share of EAP contributing to a pension

scheme



Main indicators• Employment-to-population ratio• Unemployment rate• Youth not in educ. & not in employment• Informal employment• Low pay rate• Excessive hours• Child labour*• % employed in precarious work• Occupational segregation by sex• Female share of employment in ISCO

groups 11 & 12• % pop. 65+ benefiting from a pension• Union density rate

Additional/future indicators• Labour force participation rate• Youth unemployment rate• Unemployment by level of education• Employment by status in employment• % Own account workers & contributing

family workers in total employment• % wage employment in non-agricultural

employment• Labour underutilization• Employees with recent job training• Usual hours worked (hour bands)• Rate of time-related underemployment• Number/wages of casual/daily workers• Gender wage gap• Share of population covered by (basic)

health care provision• Share of EAP contributing to a pension

schemeMost indicators are already a core part of LFS



Measurement based on • Standards adopted by the International Conference of Labour

Statisticians (ICLS)• Countries’ best practices in measurement through labour force surveys

Few in developmental stage• Measurement of income from employment through household surveys• Indicator(s) of labour underutilization• Measurement of indicators on stability and security at work, …

Relevance of LFS statistics


Employment

Stability & security

Informal employment

Voice & representation

Informal sector employment



Excessive hrs.

Time –Related Underemployment

Low pay GPG



unemployment

Labour marketattachment

Relevance ofLFS statistics


Characteristics of unemployed & labour marketattachment


Informal employment

Informal employment as % of total employment


Informal employment

• Adopted by 17th International Conference of Labour Statisticians (2003)

• To complement informal sector employment as a related but different concept – Informal sector employment: enterprise-based concept

– Informal employment: job-based concept

• Refer to different aspects of the informalization of employment • Important to measure in a coherent & consistent manner with

informal sector employment• Important to keep separate for analysis & policy purposes


Definition of informal employment 17th ICLS (2003)

Informal employment refers toTotal number of informal jobs, whether carried out in formal sector enterprises, informal sector enterprises, or households (paid domestic workers, production for own-consumption), during a given reference period

Key elements– Job-based concept (focus on characteristics of the job)– Includes all jobs (main & secondary jobs)– Includes jobs in all types of production units– Includes workers in all status in employment– Includes all branches of economic activity (agriculture & non-agricult)


Relation between informal sector employment & informal employment

Production units Informal jobs Formal jobsInformal sector enterprises A BOther units of production (formal sector enterprises & households) C D

Informal employment A + C Informal sector employment A + B Informal employment outside of the informal sector C Employment in the informal economy A + B + C


Informal sector employment

TOTAL EMPLOYMENT

Relation between informal sector employment & informal employment

Informal employment

Informal jobs outside of

IS enterprises

Formal jobs inIS enterprises


Who has an informal job? (1)

• Criteria to determine the formal / informal nature of jobs depends on status in employment

Employees – Have informal jobs if their employment relationship is, in

law or in practice, not subject to national labour legislation, income taxation, social protection or entitlement to certain employment benefits (advance notice of dismissal, severance pay, paid annual or sick leave, etc.)

Note: Definition covers (i) de jure informal jobs and (ii) de facto informal jobs.


Measurement of informal jobs of employees in LFS

Operational criteria to identify employees in informal jobs:• Lack of contributions to social security system by employer

• Lack of entitlement to paid annual leave

• Lack of entitlement to paid sick leave

Note, it is not sufficient to use:

• Lack of written employment contract

• Casual/temporary nature of work


Who has an informal job? (2)

Self-employed• Employers, own-account workers & members of producers’ coop.

– Formal/informal nature of job depends on characteristics of enterprise

– Have informal jobs if their enterprises are part of the informal sector

• Contributing family members– Employment usually not subject to labour legislation, no contractual relationship

– All have informal jobs regardless of whether the enterprise is formal or informal

• Engaged in production for own final use by household– Employment not subject to labour legislation

– All have informal jobs


Measurement of informal jobs of self-employed in LFS

Informal employment of self employed• Employers’, own account workers, members of producers

cooperatives– Requires identification of the enterprise or cooperative as belonging to the

informal sector

• Contributing family members – Question on status in employment

• Engaged in production for own final use by their household– Question on branch of economic activity (industry)

– ISIC, Rev. 3/3.1/4 permits identification (9810)

International Labour OfficeDepartment of Statistics

Source: ILO. In Brazil, estimates based on official data from various sources. In Colombia, Ecuador, Mali, Mexico, Panama, Peru

and South Africa: ILO estimates computed from labour force survey micro data. In Moldova and Turkey, labour force survey data.

a/ In Brazil, 2003 data. In Mali, South Africa, Moldova and Turkey, 2004 data. In Colombia, Ecuador, Mexico, Panama and Peru, 2007 data.

b/ In Brazil, Mali, Moldova, South Africa and Turkey, estimates are provided as a percent of total non-agricultural employment. In all

other countries, data are provided as a percent of total employment in urban areas.

(Percent of total non-agricultural employment) b/

Figure 1. Informal Employment and Employment in the Informal Sector in Ten

Selected Countries, latest year available a/

0102030405060708090

Informal employment Employment in the informal sector


Labour underutilization



• Intended uses– To supplement the unemployment rate and be reported

along with it– Broad measure of the employment problem that:

• better reflects people’s perception of “unemployment” • i.e. captures key economic AND social dimensions of

“unemployment”• Proposed scope

– Key mismatches between labour supply and demand– Undervalued labour



• Key characteristics– Fully consistent with labour force framework– Builds on existing related concepts– Readily measurable with data from labour force surveys– Single composite indicator– Can be broken down into its components for deeper

analysis and policy-making


Envisioned use of the indicator (18th ICLS, room document 13, page 28)


Labour force as a continuum

Not economically active

UnemployedEmployed

Economically active population

(Labour force)

From…


Labour force as a continuum


Not economically active

UnemployedEmployed

To…


Components of labour underutilization

a. Labour slack Insufficient volume of work

c. Low earnings Low remuneration of work

b. Skills underutilization

Inadequate match between education and occupation

Lab

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Components of labour underutilization (1)

a. Labour slack Insufficient volume of work

• Unemployed• Time-related underemployed• Discouraged jobseekers• Other inactive persons marginally attached to the LF

Labour slack among economically active persons

Labour slack among economically inactive persons

Requires development of a classification of persons not in the labour force (based on desire to work, availability & job search)



b. Skills underutilization

Inadequate match between education and occupation

• Persons employed in jobs with skills requirements below educational attainment

Measurement based on level of educational attainment (ISCED 1997) and 1 digit occupational classification (ISCO-08) applied to main job only



c. Low earnings Low remuneration of work

• Full-time employed with low monthly earnings• Less than full-time employed with low hourly earnings• Overly employed with low earnings


Labour underutilization within labour force framework

Working age population

Economically active Not economically active

Employed Unemployed

Other inactive,

not availableEmployed, low pay

Employed,Skills underutilized

Discouraged

Other inactive, available

Time-related underemployed

Other employed


Labour underutilization (LU):Calculation approach

• As a single composite measure

• Rate of labour underutilization

• Components treated as mutually exclusive (priority criteria):– 1st step: Labour slack– 2nd step: Low earnings – 3rd step: Skills underutilization

• Components can also be calculated as overlapping and reported separately

LU= labour slack + low earnings + skills underutilization

Rate of LU=(LU / working age population or extended labour force )*100


Examples: Unemployment rate &labour underutilization rate

Country Unemployment rate (%)


rate (%)Tanzania, Rep. of (2005/06) 3.3 51.9Mexico (2007 Q2) 3.4 30.2Moldova, Rep. of (2007) 5.0 46.3Philippines (2003 Q4) 5.4 40.8Panama (2007 Aug) 5.7 45.1Turkey (2007) 9.3 29.9Bosnia & Herzegovina (2006) 27.0 56.0


Periodicity of data & LFS arrangements & strategies


National programme for LF statistics:13TH ICLS Resolution I, para. 2.

Long-term needs (for structural in depth-analysis and as benchmark data)

– Comprehensive data on the economically active population

– In-depth statistics on relation between employment, income & other social and economic characteristics

– Data on particular topics (children, youth, women)

– At minimum every 10 years

Short-term needs (for current purposes, compiled frequently & recurrent basis)

– To encompass statistics of the economically active population and its components for monitoring of trends and seasonal variations

– At minimum once a year (& twice to account for seasonal variations)


Labour force survey programme for current & long-term data needs

For long-term labour force statistics programme – Occasional survey (e.g. one-off multipurpose survey)– Regular survey (e.g. inter-censal stand-alone or multipurpose

survey)

For current labour force statistics programme – Annual survey with periodic data collection for annual point-

estimates

– Continuous survey system with sample rotation for monthly/ quarterly/ annual average estimates

Depending on resources & capacity


Some strategies to improve Labour force statistics programme

• Objective: To build a regular labour force survey programme to provide for current & long-term data needs

• Strategy: Progressive development & implementation

1 One-off multipurpose survey with labour force module

2 Annual urban labour force survey or short labour force module in multipurpose survey & 5-yearly (inter-censal) national LFS

3 Annual LFS with periodic data collection in high & low seasons

4 Annual LFS with continuous data collection for monthly/quarterly/annual estimates

Annual labour force surveys

• Periodic data collection – once a year, two, four or twelve times a year

– point in time estimates

• Continuous data collection – every week or fortnight

– annual, quarterly, monthly averages

Annual labour force surveys with continuous data collection

Advantages:– Seasonal variations over time are captured and period effects eliminated

– Estimates reflect the average situation during a month, quarter or year

– Flexibility in periodicity of data dissemination (depending on sample design)

– No longer need to use concepts based on long reference periods (e.g. usual activity, annual income), which are prone to recall errors

– Improved timeliness in dissemination due to continuous data entry & processing

– Smaller dedicated field interviewers teams = better quality & lower staff turnover


Activities of the ILO:Work in progress

• Labour force surveys & decent work indicators– Model labour force surveys materials based on standards & best

practices• Building-block approach• Model labour force survey section & question sequences flow charts• Question elements (text, response options, skips, instructions)• Topic-specific flow charts• Explanatory notes • Definition sheets for derived variables• Indicator requirement sheets

– Developmental work to pilot test question sequences


• Manual on Surveys of Informal Employment & Informal Sector– 11th Meeting of the Delhi Group (Geneva, January 2010)

– Main draft available at (under 11th Meeting):

http://mospi.nic.in/Mospi_New/site/DelhiGroup.aspx

– Publication: forthcoming in 2011



• Labour underutilization– 2008: 18th ICLS Resolution concerning the development of

measures of labour underutilization

– 2009: Technical Workshop on measures of labour underutilization

– 2010: Working Group for the Advancement of Employment & Unemployment Statistics

• Objective: To propose draft recommendations for possible adoption by the 19th ICLS in 2013


Working Group for the Advancement of Employment & Unemployment Statistics

+5 representatives from Afristat, Eurostat, OECD

Africa Americas Asia & Pacific Europe

MaliMauritiusMoroccoSouth AfricaTunisiaUgandaZimbabwe

BrazilColombiaMexicoPeruUSA

IndiaJapanKazakhstanNew ZealandPhilippinesSri LankaThailandWest Bank & Gaza Strip

DenmarkFranceGermanyIrelandItalyMoldovaNorwaySpainSwitzerlandTurkey

Current membership


Merci / Thank you

Documents

ILO Department of Statistics Measuring Decent Work through labour force surveys Elisa M. Benes Household Surveys Unit ILO Department of Statistics Email: