The method of harmonised Labour Market Areas in Europe Valeriya Angelova-Tosheva, Eurostat, Valeriya.ANGELOVA-TOSHEVA@ec.europa.eu 29/06/2018 Session 19

C O N T E N T S Context and motivation The algorithm for delineation of harmonised Labour Market Areas (LMAs) Illustration of the results on LMAs obtained by two Member States C O N T E N T S

Context and motivation Context and motivation Territorial administrative breakdown: the NUTS classification Hierarchical structure: 3 levels; each level of NUTS is a subdivision of the higher level Can be amended after at least 3 years have passed on the previous version to ensure a minimum of stability Prefers the use of territorial units which are administrative in the Member States Should correspond to population thresholds

Context and motivation Limitation of NUTS Regional administrative boundaries often the result of historical circumstances They do not necessarily mirror the present day's social and economic reality Commuting distorts important data on the administrative regions such as employment and GDP especially in regions with asymmetric commuting patterns (e.g. Luxembourg, Inner London, Brussels, Zürich)

Cross-border commuter, by NUTS 2 regions, 2015

Context and motivation The advantages of the Labour Market Areas Can be defined as an economically integrated functional region where the majority of the labour force lives and works Bring to light the effects of commuting on the labour market centres and their periphery Assist in the design of employment, labour mobility and urban planning policies (a. o.) Independent from the administrative upper level

The method for delineation of harmonised LMAs The aim of the method is to aggregate neighbouring Local Administrative Units (LAUs) to LMAs, satisfying a particular validity condition (internal cohesion and external separation principles), based on functional relationships, namely the commuting flows Just two input datasets: number of persons employed and number of commuters (LAU level) Four parameters set the constraints to define the LMAs in an open R package: minimum self-containment target self-containment minimum number of persons employed target number of persons employed

Main principles of the algorithm The target self-containment is always greater than the minimum self-containment The recommended target self-containment is between 0.75 (1 out of 4 residents is commuting outside the LMA) and 0.8 (only 1 out 5 residents is commuting outside the LMA) The recommended minimum self-containment is between 0.6 (3 out of 5 is commuting outside) and 0.6667 (1 out of 3) The method considers a cluster of municipalities to be an LMA if the validity condition is fulfilled: minSC tarSC ≤ 1− 1− minSC tarSC ∙𝑀𝐴𝑋 tarSZ − 𝑺𝒁 tarSZ − minSZ ,0 ∙ 𝑀𝐼𝑁(𝑺𝑪, tarSC) tarSC

Illustration of the results on LMAs obtained by Bulgaria and Portugal The results obtained by the two countries have been communicated to national stakeholders, who have accepted the LMAs as meaningful, and reflecting the reality of the local labour market and the observed commuting patterns Eurostat made an experiment to check whether the LMAs produced based on the method capture a fundamental characteristic of the territories – the rurality

Share of population by LMA living in high density and urban clusters

Observations The rural LMAs in Bulgaria are generally smaller while the rural LMAs in Portugal are rather bigger as a size, both countries having settlements asymmetries The area of the Bulgarian LMAs with a median of around 900 sq. km varies from less than 180 sq. km in a rural LMA located at the border with Greece to more than 4200 sq. km in the LMA of the capital city of Sofia The area of the Portuguese LMAs with a median of more than 2700 sq. km varies from around 800 sq. km in the second largest city of Porto to around 8500 in the rural LMA of Beja In Bulgaria there are no 100% urban LMAs

Distribution of the population by different type of density clusters - the analytical power of the grid statistics combined with functional geographies such as the LMAs

The method of harmonised Labour Market Areas in Europe Thank you for your attention! Valeriya Angelova-Tosheva, Eurostat, Valeriya.ANGELOVA- TOSHEVA@ec.europa.eu