1. The method of harmonised Labour Market Areas in Europe
Valeriya Angelova-Tosheva, Eurostat,
29/06/2018
Session 19

2. 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

3. 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

4. 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)

5. Cross-border commuter, by NUTS 2 regions, 2015

6. 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

7. 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

8. 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 (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

9. 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

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

11. 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 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

12. 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

13. The method of harmonised Labour Market Areas in Europe
Thank you for your attention!
Valeriya Angelova-Tosheva, Eurostat, Valeriya.ANGELOVA-