Eurostat – Labour Market Areas – Final Technical report – Finland 1(37) Labour Market Areas Final Technical report of the Finnish project September 2017 Data collection for sub-national statistics (Labour Market Areas) Grant Agreement No. 08141.2015.001-2015.499 Yrjö Palttila, Statistics Finland, 22 September 2017 Postal address: 3rd floor, FI-00022 Statistics Finland E-mail: [email protected] Yrjö Palttila, Statistics Finland, 22 September 2017 Eurostat – Labour Market Areas – Final Technical report – Finland 2(37) Contents: 1. Overview 1.1 Objective of the work 1.2 Finland’s national travel-to-work areas 1.3 Tasks of the project 2. Results of the Finnish project 2.1 Improving IT tools to facilitate the implementation of the method (Task 2) 2.2 The finished SAS IML module (Task 2) 2.3 Define Finland’s LMAs based on the EU method (Task 4) 3. Assessing the feasibility of implementation of the EU method 3.1 Feasibility of implementation of the EU method (Task 3) 3.2 Assessing the feasibility of the adaptation of the current method of Finland’s national travel-to-work areas to the proposed method (Task 3) 4. The use and the future of the LMAs Appendix 1. Visualization of the test results (November 2016) Appendix 2. The lists of the LAU2s (test 12) (November 2016) Appendix 3. The finished SAS IML module LMAwSAS.1409 (September 2017) 1. Overview 1.1 Objective of the work In the background of the action was the need for comparable functional areas in EU-wide territorial policy analyses. The NUTS cross-national regions cover the whole EU territory, but they are usually regional administrative areas, which are the re- sult of historical circumstances. The present national definitions of travel-to-work areas are not consistent in different countries. One of the EU-wide efforts for comparability of functional areas has been the Urban Audit’s Functional Urban Areas, FUA (for- mer: Larger Urban Zones, LUZ). FUA-areas are based on commuting around cities, but FUA-areas do not cover all the travel-to-work areas. The first aim of the Finnish project was to define preliminary al- ternatives of the Finnish Labour Market Areas (LMAs) as part of Europe and to compare them with Finland’s national travel-to- work areas. The preliminary Finnish LMAs have been based on the harmonised definition. Yrjö Palttila, Statistics Finland, 22 September 2017 Eurostat – Labour Market Areas – Final Technical report – Finland 3(37) The alternatives of Finnish LMAs which have been pre- sented in this report are only experimental. They have not been officially dealt with anywhere. The second aim of the Finnish project was to build a tool which makes possible to use the SAS programme in defining of LMAs. The tasks of the Finnish project did not include defining of cross-border LMAs. 1.2 Finland’s national travel-to-work areas Statistics Finland has established an official national statistical classification of travel-to-work areas, which is based on the data on commuting in the register-based employment statistics. Statistics Finland’s national travel-to-work area is formed by a central municipality (LAU2 area) and surrounding municipalities. A municipality is considered to be a central municipality if at least one municipality commutes to it, and fewer than 25 per cent of its employed persons commute to areas outside the central municipality. A surrounding municipality belongs to the travel-to-work area if at least 10 per cent of its labour force commute to the central municipality. However, the municipality can belong to only one travel-to-work area. If at least 10 per cent of the employed persons of the mu- nicipality commute to two municipalities, it belongs to that travel-to-work area to which is commuted more. The municipal- ity can also belong to a travel-to-work area through some other municipality if at least 10 per cent of the employed persons of the municipality commute to that municipality that belongs to the travel-to-work area of some central municipality, but that is not the central municipality itself. Map A represents Statistics Finland’s national travel-to-work areas 2015. Yrjö Palttila, Statistics Finland, 22 September 2017 Eurostat – Labour Market Areas – Final Technical report – Finland 4(37) Map A. Statistics Finland’s national travel-to-work areas 2015. On 1 January 2015, the classification contained 42 travel-to- work areas comprising a total of 224 municipalities (LAU2s). There were 93 municipalities that lay outside travel-to-work- areas. These municipalities with a low number of commuters were self-contained labour market areas. Finland’s national method of travel-to-work areas’ delineation is also described in “Study on comparable Labour Market Areas – Final research report”, 2012 (Annex 1, page 121). The notes concerning Finland’s national method were: ‘A. It is a core-based hierarchical clustering procedure with a very simple linkage criterion: only the links between central elements of each cluster are considered Yrjö Palttila, Statistics Finland, 22 September 2017 Eurostat – Labour Market Areas – Final Technical report – Finland 5(37) ‘B. Contiguity is not a restriction and non-contiguous travel-to- work areas are accepted (only a few cases in practice). ‘C. Travel-to-work areas do not have to fulfil any criteria apart from having a central municipality and a hinterland (no mini- mum/maximum levels for self-containment, population or area). ‘D. Travel-to-work areas with very low self-containment could be created, as the aggregated flows are not considered. For the same reason, municipalities could be assigned to travel-to-work areas to which few total workers commute, despite having stronger aggregated dependence to other neighbouring travel- to-work areas. 1.3 Tasks of the project The tasks of the Finnish project are: Task 2. Improve IT tools to facilitate the implementation of the method Task 3. Assess the feasibility of implementation of the EU method Task 4. Define LMAs based on the EU method (the task does not include defining of cross-border LMAs) 2. Results of the Finnish project 2.1 Improving IT tools to facilitate the implementation of the method (Task 2) Task 2. Develop or improve IT tools to facilitate the implementa- tion of the method. In the framework of the Task Force an IT tool (a script based on open-source software “R”) has been de- veloped to support the proposed method (see annex B). The task could include the re-engineering of this existing script in order to improve the performance. Another possibility is to de- velop a new IT tool which caters for the specific requirements of the NSI. (Grant Application Documents; Technical Annex, para- graph 2, item 2). Italian National Institute of Statistics (ISTAT) has developed a LabourMarketAreas package based on open-source software R to support the proposed method in the delineation of harmo- nised labour market areas (LMAs). Yrjö Palttila, Statistics Finland, 22 September 2017 Eurostat – Labour Market Areas – Final Technical report – Finland 6(37) The EU (TTWA) method is described in the Technical Annex of the Grant Application Documents (Annex A and B) and in the fi- nal report of the “Harmonised Labour Market Areas” Task Force, January 2015. At Statistics Finland we are using the “SAS for Windows” statis- tical program. Only a couple of persons are familiar with the R program. Originally our aim was to translate R-code of the EU Travel To Work Area (TTWA) algorithm to SAS-code. However, the struc- tures of the languages are quite different. Instead we have drawn up a SAS/IML (Interactive Matrix Language) procedure, which makes possible to call R functions from SAS program, and translation needed not to be made. The R package LabourMarketAreas includes R function find- Clusters, which implements an iterative algorithm. The function makes labour market areas (LMAs) from commuting flow data between municipalities. SAS/IML procedure introduces an interface that enables to call functions in the R statistical language from SAS/IML program. Our interface to the R function findcluster included in the pack- age LabourMarketAreas was tested for version v1.0 (November 2016). Our SAS/IML module LMAwSAS (TyossaKayntiAlueet) includes the same parameters as on the R function findClusters (minSZ, minSC, tarSZ, tarSC). The module LMAwSAS (TyossaKayntiAlueet) produces SAS data sets (November 2016) (clusterlist.sas7bdat, clus- terlist_before0.sas7bdat, lwclus.sas7bdat, lwclus_before0.sas7bdat, mar- ginals.sas7bdat, marginals_before0.sas7bdat, notassigned.sas7bdat, re- servelist.sas7bdat, zerolistcommunities.sas7bdat, zerolistlwcom.sas7bdat, zerolistresidents.sas7bdat, zerolistworkers.sas7bdat). 2.2 The finished SAS IML module (Task 2) The finished SAS IML module LMAwSAS.1409 (September 2017) is on Appendix 3 . It has been uploaded on the Cros por- tal page devoted to the LMA projects under IT tool with public access: https://ec.europa.eu/eurostat/cros/content/labour-market-areas_en This module has been tested with LabourMarketAreas version 3.1. Later versions will probably work, if the R function "find- Yrjö Palttila, Statistics Finland, 22 September 2017 Eurostat – Labour Market Areas – Final Technical report – Finland 7(37) Clusters" can be called with the following arguments: input, minSZ, minSC, tarSZ, tarSC. Because the SAS UNIX users might have difficulties with RTF or WORD documents, the format of the file is txt. 2.3 Define Finland’s LMAs based on the EU method (Task 4) Task 4. Define LMAs based on the EU method. Provide the list of the LAU2s composing the LMAs as well as documentation of the exact method used, the characteristics of the LMAs pro- duced. (Grant Application Documents; Technical Annex, para- graph 2, item 4). The TTWA method The TTWA method operates with two properties: self- containment and number of workers (persons employed).