Labour Market
Strengths and limitations of the LFS
Labour market The LFS produces coherent labour market information on the basis of internationally standard concepts and defini- tions. It is a rich source of data on a wide variety of labour Labour Force Survey market and personal characteristics. It is the most suitable source for making comparisons between countries. The (Tables 7.1–7.3, 7.6, 7.9, 7.10–7.11, 7.13 and 7.16–7.18) LFS is designed so that households interviewed in each Labour Force Survey three-month period constitute a representative sample of UK households. The survey covers those living in private Background households and nurses in National Health Service accom- modation. Students living in halls of residence have been The Labour Force Survey (LFS) is the largest regular household included since 1992 as information about them is collected survey in the UK, with interviews being conducted at their parents’ address. continuously throughout the year. In any three-month period, a nationally representative sample of approximately 110,000 However the LFS has its limitations. It is a sample sur- people, aged 16 and over, in around 50,000 households are vey and is therefore subject to sampling variability. The interviewed. Each household is interviewed five times, at survey does not include people living in institutions such three-monthly intervals. The initial interview is done face- as hostels, hotels, boarding houses, mobile home sites or to-face by an interviewer visiting the address, except for residential homes. ‘Proxy’ reporting (when members of the residents north of the Caledonian Canal in Scotland. The household are not present at the interview and another other interviews are done by telephone wherever possible. The member of the household answers the questions on their survey asks a series of questions about respondents’ personal behalf) can affect the quality of information on topics such circumstances and their labour market activity. Most questions as earnings, hours worked, benefit receipt and qualifica- refer to activity in the week before the interview. tions. Around a third of interviews are conducted by proxy, The LFS collects information on a sample of the population. To usually by a spouse or partner but sometimes by a parent convert this information to give estimates for the population or other near relation. LFS estimates are also potentially the data must be grossed. This is achieved by calculating affected by non-response. weighting factors (often referred to simply as weights) which Sampling Variability can be applied to each sampled individual in such a way that the weighted-up results match estimates or projections of the Survey estimates are prone to sampling variability. The total population in terms of age distribution, sex and region of easiest way to explain this concept is by example. In the residence. There is a considerable amount of ongoing research September to November 1997 period, ILO unemployment to improve methodologies. Whenever methodologies are in Great Britain (seasonally adjusted) stood at 1,847,000. If implemented the estimates may be revised. we drew another sample for the same period we could get a different result, perhaps 1,900,000 or 1,820,000. The concepts and definitions used in the LFS are agreed by the International Labour Organisation (ILO) – an agency of In theory, we could draw many samples, and each would the United Nations. The definitions are used by European give a different result. This is because each sample would Union member countries and members of the Organisation for be made up of different people who would give different Economic Co-operation and Development (OECD). answers to the questions. The spread of these results is the The LFS was carried out every two years from 1973 to sampling variability. Sampling variability is determined by a 1983. The ILO definition was first used in 1984. This was number of factors including the sample size, the variability also the first year in which the survey was conducted on an of the population from which the sample is drawn and the annual basis with results available for every spring quarter sample design. Once we know the sampling variability we (representing an average of the period from March to May). can calculate a range of values about the sample estimate The survey moved to a continuous basis in spring 1992 in that represents the expected variation with a given level of Great Britain and in winter 1994/95 in Northern Ireland, assurance. This is called a confidence interval. For a 95 per with average quarterly results published four times a year cent confidence interval we expect that in 95 per cent of for seasonal quarters: spring (March to May), summer (June the samples (19 times out of 20) the confidence interval to August), autumn (September to November) and winter will contain the true value that would be obtained by sur- (December to February). From April 1998, results are published veying the entire population. For the example given above, 12 times a year for the average of three consecutive months. we can be 95 per cent confident that the true value was in the range 1,791,000 to 1,903,000.