Request
I appreciate all the considerable effort clearly undertaken to lay out absolutely everything on your web site, but I find it dauntingly pocked with unfathomable detail. I would love clarification of some basics concerning employment, unemployment & benefits information.
1) Are the databases interactive? Do they tie? If I add and subtract from one base will I be able to get to a figure set out on another?
2) The Prime Minister regularly claims over a million jobs have been created in the private sector. News commentators regularly express the confusion of economists (not the presenters, of course) as to how that could be in an at best flat lined economy. If they think they are confused ... the myths and uncertainties are insurmountable.
Which leads me to my questions:
A. Does your office tie with, recognize and can confirm that over a million jobs have been created in the private sector this past year? If so what is the number of private sector jobs created in the UK since 1 April 2011?
B. Of these jobs, do the aggregate cumulatively or if an employer lays someone off and recreates the job is it counted as a new job each time?
C. How many of these new jobs represent a transfer of existing public sector jobs to the private sector? For example, BBC recently required its "talent" to move off books into private, Independent Contractor status. For another example, privatization has led to "new" jobs that are in fact old jobs laid off in the public sector. For the latter category how do you account for such transfers in your job figures? If you have the specific number within this number of private sector jobs created to take formerly public sector work I would like this figure separately.
D. Of the total new private sector jobs how many, if any, are "workfare" slots? I made an assumption here. Let me clarify it. Are workfare slots included in the aggregate jobs and are they included as private sector jobs? If that isn't the intent would you have a way of preventing it from happening?
E. Of the total new private sector jobs how many, if any, are "intern" slots? I made an assumption here, too, I should clarify. Are Intern slots included in the aggregate jobs and as private sector jobs? If that isn't the intent would you have a way of preventing it?
F. Of the total new private sector jobs how many, if any, represent a person receiving benefits who has listed themselves as an independent contractor in order to take advantage of the higher premium working tax credits offer?
G. If such factors do/ could affect the statistics and you are not able to give accurate tallies on such information (or do not as practice), is your regular report footnoted to disclose these factors and disclaim the statistics accordingly?
3) I understand your role is reporting of accurate statistics not policy or politics. I understand you are neutral and as objective as you can be. But surely you do have at least a SWAG assessment of why employment rises while long term employment deteriorates and the economy flat lines. Do you have such a view and is it public? If it is I would like your opinion on it. It is very hard to be a good citizen doing one's due diligence to inform himself as a voter. I appreciate all the help you can offer in a summary form. While I truly admire the vast amount of effort that goes into your web site and all your reports I just find the information overwhelming. I would guess you can't deal with the individual request of everyone in the UK. You may take my request as an indication that many need a narrower band of more meaningful information. I know this to be the case. I know I am not alone. Therefore, you may wish to consider publishing a report in the format I laid out, again - assuming you have the information.
Response
Section 1
The Labour Market Statistics come from a range of sources, so some care has to be taken when comparing the published outputs. A full guide to the regularly published information is available. A summary of the data relating to employment, unemployment and benefits is below.
The headline statistics for total employment, unemployment, economic inactivity and hours worked are produced from the Labour Force Survey (LFS). These estimates and are all consistent with each other and can be added and subtracted to derive further estimates. The LFS can be used to produce a number of breakdowns of the headline data, e.g. splitting employment between full-time and part-time, employees and self-employed etc. However, because people on the LFS are classified according to their answers to the survey, the LFS is not suitable to produce estimates of public sector employment or employment by industry.
Estimates of employment in the public sector are produced from a combination of administrative data and quarterly surveys of public sector bodies in the UK. These produce a total level of employment in the public sector. To calculate the level of private sector employment the public sector estimates are subtracted from the total employment level from the LFS.
Benefits data, including the number of people claiming Jobseekers' Allowance (JSA), are produced from information from the databases at the Department for Work and Pensions (DWP). This information is totally independent from the LFS data and is based on a different definition to the published figures for unemployment. The unemployment total measures all people who report that they have not worked, are looking for work and are available to start work. While this will include people who are claiming JSA it will also include people who are not eligible for JSA (e.g. students, people whose partner is working etc.). A full comparison of unemployment and JSA claimants is published as part of our monthly release. The latest version can be found on our website.
Section 2
A: The Office for National Statistics does not collect any statistics relating to the number of new jobs created. The figures published by the Office for National Statistics on private sector employment are estimates of the total number of people employed in the private sector and the net change in this number. This is not the same as the number of jobs in the private sector, as one person can have more than one job or one job can be shared by more than one person. Nor is the net change in the number of people employed an estimate of the number of jobs created. Therefore the ONS can neither confirm or deny that over a million jobs have been created in the private sector this past year.
The net change in the number of people employed in the private sector in the year between September 2011 and September 2012, the latest period available, is 823,000. In April 2012 English further education colleges and English sixth form college corporations were reclassified to the private sector. This accounts for around 196,000 of the net change in private sector employment.
The estimates of private sector employment are provided on a quarterly basis corresponding to March, June, September and December. Therefore an estimate of the net change in private sector employment since April 2011 is not available. The net change in the number of people employed in the private sector between March 2011 and September 2012 is 828,000. This net change is similarly affected by the reclassification of English further education colleges and English sixth form college corporations.
B. Estimates of private sector employment are calculated as the difference between total employment and public sector employment. The estimate of total employment is derived from the Labour Force Survey, a survey of persons living in households. The estimate of public sector employment are derived from returns from public bodies which provide the number of people on their payroll. Therefore if an employer lays someone off and then recreates the job this will not count as an additional person employed.
C. If an existing public sector job is transferred to the private sector such that the person in the job is no longer on the payroll of the public sector organisation, but is still employed, then this employment will be counted in the private sector. The ONS does not estimate this figure explicitly except where there is a reclassification of a set of organisations between the public and private sector. An example of this is the reclassification of English further education colleges and English sixth form college corporations which is mentioned above. These reclassification decisions, made by the ONS classification committee, are published on a monthly basis.
Therefore ONS cannot provide an estimate of the number of public sector jobs transferred to the private sector.
D. Employment estimates from the LFS include people who are on Government Supported Training Schemes (including Workfare) if they are carrying out work experience or workplace-based training. This is based on responses to the survey.
E. For someone to be counted as employed they need to have carried out a minimum of one hours paid work in the week before they were surveyed. If they have carried out unpaid work as an intern they will not be included in the employment figures but will be classed as unemployed (if they are also looking for work and available to start work) or inactive (if they are not looking or consider themselves unavailable.)
F. The LFS does not collect information on which people are in receipt of tax credits. More generally, people are classified as employed if they report that they have carried out at least an hour of paid work. This classification is not affected by any benefits they receive.
G. Footnotes are not provided to explicitly disclose these factors and disclaim the statistics accordingly.
Section 3
ONS has produced some analysis looking at the recent movements in output and employment which may help answer your questions. The articles can be accessed here:
http://www.ons.gov.uk/ons/rel/elmr/the-productivity-conundrum/interpreting-the-recent-behaviour-of-the-economy/art-interpreting-the-recent-behaviour-of-the-economy.html (published 24 August 2012)
http://www.ons.gov.uk/ons/rel/elmr/the-productivity-conundrum/explanations-and-preliminary-analysis/art-explanations-and-preliminary-analysis.html (published 16 October 2012)
