On building statistical indicators at Labour Market Area level Daniela Ichim Istat, Department of Production Statistics ichim@istat.it

Structural Business Statistics Different geographies Summary Structural Business Statistics Different geographies e.g. Labour Market Areas Integration of statistical registers Frame-SBS, Asia-UL e RACLI-UL Issues on deriving economic indicators Conclusions On building statistical indicators at Labour Market Area level – Daniela Ichim, Southampton, August 2017

Structural Business Statistics COMMISSION REGULATION (EC) No 251/2009 Series 2B Series 2C On building statistical indicators at Labour Market Area level – Daniela Ichim, Southampton, August 2017

Territorial partitions Administrative partitions NUTS2 NUTS3 LAU  N 20 110 8092 Min   1 74 Mean 5.5 404.6 Max 12 1544 On building statistical indicators at Labour Market Area level – Daniela Ichim, Southampton, August 2017

Territorial partitions Functional / statistical partitions Functional Metropolitan areas Health care system Justice system Touristic system Statistical Labour market areas On building statistical indicators at Labour Market Area level – Daniela Ichim, Southampton, August 2017

Labour Market Areas definition 3. Fine tuning 1. Preliminary treatment 2. Partition 4. Analysis 5. Dissemination 6. Dissemination On building statistical indicators at Labour Market Area level – Daniela Ichim, Southampton, August 2017

Labour Market Areas (LMA) Partitions of the territory, starting from elementary units (LAU) No constraint on administrative boundaries. # 1 2 3 4 5 6 7 NUTS2 555 54 NUTS3 426 163 19 On building statistical indicators at Labour Market Area level – Daniela Ichim, Southampton, August 2017

LMA - statistics Commuting flows from residence to work place (census, administrative data, multiple sources) - Residents - Employment Education Age … On building statistical indicators at Labour Market Area level – Daniela Ichim, Southampton, August 2017

SBS-LMA QUESTION Series 2B Series 2C On building statistical indicators at Labour Market Area level – Daniela Ichim, Southampton, August 2017

Aim: Regionalisation of SBS Economic indicators SBS-LMA Aim: Regionalisation of SBS Economic indicators Different administrative partitions (NUTS3) Functional and statistical partitions (LMA) The common key is the elementary unit (LAU). Is it possible to transfer the economic measures at local level? How? Advantages and drawbacks? On building statistical indicators at Labour Market Area level – Daniela Ichim, Southampton, August 2017

Regionalisation of SBS – example of usage SBS-LMA Regionalisation of SBS – example of usage DL 83/2012, art.27 Strategic plan built on two intervention models: on COMPLEX industrial crisis areas [DL 83/2012, art.27.8 → DM 31.01.2013] on NON-COMPLEX industrial crisis areas [DL 83/2012, art.27.8 bis→ DM 4.08.2016] Prevailing production specialisation (industrial Census 2011) Combination of employment & unemployment rate (ref.2014) Employment & unemployment variation compared to the average 2008-14 Labour productivity 2012 (added value per employed person) Traditional administrative borders do not fit to these objectives as they portray the organisation of community management, not labour market flows & borders. On building statistical indicators at Labour Market Area level – Daniela Ichim, Southampton, August 2017

Aim: Regionalisation of SBS Economic indicators Elementary unit LAU Aim: Regionalisation of SBS Economic indicators Different administrative partitions (NUTS3) Functional and statistical partitions (LMA) The key is the elementary unit (LAU). LAU NUTS3 LAULMA etc On building statistical indicators at Labour Market Area level – Daniela Ichim, Southampton, August 2017

Istat register Frame-SBS since 2011 Economic indicators Istat register Frame-SBS since 2011 Turnover, Wages and salaries, Value added, etc 4mln enterprises no information on the interaction between enterprises and territory: only headquarters  Turnover, Value added, etc are “assigned” to the headquarter region. On building statistical indicators at Labour Market Area level – Daniela Ichim, Southampton, August 2017

Territorial characteristics of enterprises The link between enterprises and territory may be represented by their local units (LU). Lombardia: 3% of the LU are located outside. Italy: the percentage ranges from 0.3% (Sardinia) to 6.5% (Lazio). On building statistical indicators at Labour Market Area level – Daniela Ichim, Southampton, August 2017

Territorial characteristics of enterprises Reduced number, significant economic impact # Employees Turnover Value added Labour Cost Enterprises 100.00 Enterprises with LU 4.92 35.16 53.80 48.92 55.21 Enterprises with LU in different regions 0.68 19.48 36.27 32.28 34.74 Enterprises with LU in different provinces 1.38 23.79 41.50 37.27 41.00 Enterprises with LU in different LMA 1.83 25.91 43.47 39.34 43.61 On building statistical indicators at Labour Market Area level – Daniela Ichim, Southampton, August 2017

Enterprise  LU (a top down approach) Using auxiliary information Elementary unit - LAU Enterprise  LU (a top down approach) Using auxiliary information a) ASIA-UL – structural and employment at LU level b) RACLI-UL– labour cost at LU level Issues: a) economic theory b) statistical method c) quality On building statistical indicators at Labour Market Area level – Daniela Ichim, Southampton, August 2017

Enterprise  LU (a top down approach) Issues: economic theory Indicators Enterprise  LU (a top down approach) Issues: economic theory Is it possible/reasonable to transfer the economic measures at local level? Turnover, value added, exports, gross operating margin, stocks, production value - same treatment? Business functions: production, logistics, trade, etc Proxies: establishment characteristics (NACE, characteristics of employees) On building statistical indicators at Labour Market Area level – Daniela Ichim, Southampton, August 2017

Enterprise  LU (a top down approach) Issues: method Indicators Enterprise  LU (a top down approach) Issues: method - Straightforward allocation: #of employees, LC, etc - Complex allocation Ideally, a) proportional b) including relationships between variables, e.g. Manual on regional accounts methods Enterprise LU_1 LU_2 … LU_n On building statistical indicators at Labour Market Area level – Daniela Ichim, Southampton, August 2017

Straightforward allocation: #of employees Indicators Straightforward allocation: #of employees - Proportional allocation: Min Q1 Median Mean Q3 Max -22.6 -11.8 -8.3 -6.8 -3.9 18.0 Method Min Q1 Median Mean Q3 Max # LU -82.51 -35.86 -21.26 -23.83 -7.889 41.42 # empl -59.63 -26.02 -15.61 -16.71 -7.399 34.37 # LC -54.56 -24.62 -14.47 -15.48 -6.875 33.27 On building statistical indicators at Labour Market Area level – Daniela Ichim, Southampton, August 2017

Enterprise  LU (a top down approach) Issues: quality Indicators Enterprise  LU (a top down approach) Issues: quality There is no benchmark. Is it reasonable to expect coherent results with SBS statistics (produced with respect to headquarters)? - By construction: Stone algorithm set up at micro level. - a-posteriori adjustments On building statistical indicators at Labour Market Area level – Daniela Ichim, Southampton, August 2017

Regionalisation of SBS is necessary for improved local policies. Conclusions Regionalisation of SBS is necessary for improved local policies. LMAs represent an important territorial partition as they describe the labour market dynamics. Data integration may be a solution, but further improvements are needed: - classify the relationships between unit types - classify the relationships between variables - identify methods for deriving new variables (depending on both units types and input variables) LAU-estimation phase – alternatives? On building statistical indicators at Labour Market Area level – Daniela Ichim, Southampton, August 2017

Thank you!