Out for the Count: A Social Scientist's Analysis of Unemployment Statistics in the UK Author(s): Paul Gregg Source: Journal

of the Royal Statistical Society. Series A (Statistics in Society), Vol. 157, No. 2 (1994), pp. 253-270 Published by: Blackwell Publishing for the Royal Statistical Society Stable URL: http://www.jstor.org/stable/2983361 Accessed: 10/10/2010 12:20
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controversy centred theimpact This has that in frequent. suchas higher of National Institute Economic and Social Research. Smith tAddressforcorrespondence: Square.Frequent To has this changes of coverage and consistencybetween sources of information which provide measuresof unemployment have led to a paucity of data that are suitable for social scientific studywithits impliedcoststo our understanding unemployment thelast of over 15 years. UNEMPLOYMENT SUMMARY 1. pp.the shortageof available work shouldbe measuredbythebroaderindicators social distress wellas theidentification of as of excess labour supplyin the labour market. Critics have expressed viewthatcalculating a unemployment the old (pre-1982) in coverage wouldresult a considerably totalfigure.J. ? 1994 Royal Statistical Society 0035-9238/94/157253 . The design of the Labour Force Surveyshould take on board the questions raised by social scientists. A (1994) 157. SWIP 3HE. Revised June 1993] The validity UK unemployment of the statistics was the focus of intensedebate through 1980s and again in 1992.In particular.It is hoped thatan increasing relianceon specifically designedsurvey techniques. rather thanmeasuresbased on benefit administration data.2 Dean TrenchStreet. mostly minor.London. STATISTICS. Statist. UK [Received September1992. Here we argue that such a debate is somewhat fruitlessand that it misses the damage that has been done to our understanding of unemployment through the For the last decadethe official monthly countof the unemployed beenthe has of on the subject serious controversy. will overcomemanyof these problemsfor the 1990s. London. Part 2. is rather by-product an administrative system benefit in assessment hence to in and vulnerable changes that The system. INTRODUCTION that of the Unemployment Unit (UU) index. UK.Soc. 253-270 Out for the Count: a Social Scientist's Analysisof Unemployment in Statistics the UK By PAUL GREGGt National Instituteof Economic and Social Research. madeagainst count the method estimating of Charges unemployment concerned aboutpolitically of allegations inspired manipulation thefigures through in numerous changes coverage during 1980s. changes coverage havehad on theheadline number of unemployed. some extent argument misseda widerpoint. R. Keywords: DISCOURAGED WORKERS. changes coverage of theclaimant more countoverthelast decadehave onlymadethisdistinction have obvious. debate This overthe'true' measure thecount what wouldhave of or it beenontheoldbasishastended obscure to what economists perhaps more is the for important issue:thattheclaimant countis notand never beena measure has of excess labour It a of of supply.The supporting the evidence these for has been thatall but one of thesechangeshave been unidirectionalcharges on downwards. This mainlyconcernedwhether theywere open to politically motivated manipulation.

a practice alreadyundertaken the OECD and the EuropeanEconomic by caused measure broader the socialdistress Community (EEC)). thepublic. family credit. theirUB have Those who have not made sufficient contributions. including in amountof workby one or more absenceof workor a shortfall the desired thosefamilies members causing household is low income. reduced appearin thecount.now largely computerized. all where an shouldinclude peoplein households families. whodo notreceive but whoappearin thecount. and for remove benefits which single parents olderworkers maybe eligible other from claimant the counteither immediately after runsout. The secondshould of socialdistress Such a measure wider of by a shortage workin thehousehold. non-claimant support to invalidity sickness) raisetheir and income levelfrom lowbase causedbylack the of availableworkforone or moremembers. of in as to For thiswe call foran overhaul theunemployment of statistics presented of of shouldbe produced. Thiswouldthen exclude but where member out of workwhileothers one is have earnedincomes include income all thoserequiring benefits (IS). WHAT IS CLAIMANT COUNT? The current of is sourceforthemeasurement UK unemploymentthe primary claimant claimant monthly count.Married women often entitled claimIS butwillbe included thehusband's are not to in claim forUB. mustnormally attempting claimunemployment to benefit be countan individual and as insurance credits qualify being availableforwork.People still'sign benefit people . exceeded for entitlement periodor are ineligible otherreasonsmay be able to claimIS.g. benefit sheis outof Cohabiting also disqualify womanfrom may work.The disabled. is unless has This they the number of are homeless satisfy or Thereare a significant other restricted criteria. theability claimrests thenumber and to made during contributions and size of national insurance employment. IS or national on lastsa yearand is notmeanstested.UB (UB). Youthsunder or UB 18 years also haveunusualclaimant for old criteria they no longer as are eligible if do scheme training anybenefit they nottakea placeon thenewtwo-year youth or quitsucha placebefore programme beencompleted.To appearin the.254 GREGG [Part2. (e. IS or family If or credit. of 1980s. or children. 2. well as of to for of understandingthe offering opportunities setthegroundwork an improved nature unemploymentthe 1990s. payment the(ex-)wife to any IS of alimony maintenance a childwillbe takenintoaccountin assessing or for a if entitlement. is meanstested thejointincome on formerly or of a coupleand also on thevalueof savings realizable valueof assets. previous if left voluntarily Benefits be withheld up to 6 months) theindividual work may (for or was sackedforgrossmisconduct. also argue We that opportunity exists begin process making the now to the as unemployment statistics beyondsuspicion politicalmanipulation. or Menwhosewives cohabitees in part-time willstill eligible are for be work benefits hencestill and long-term sick. separated divorced. IS known supplementary as benefit.Two distinct types measure unemployment by The first shouldmeasureexcesslabour supplyas defined the International and for Co-operation LabourOrganization (ILO) and theOrganization Economic the LabourForceSurvey Development (OECD) and derived from newquarterly for to countcan be utilized provide monthly estimates first (LFS) (theclaimant this.

it the However. theyare stillnot in workor on a government scheme). and other age sources income of and wealth propensity and to claim. changes October1979and October1982to thesecondgroupand in thechanges July 1985and March1986to thethird.April 1983.1994] UNEMPLOYMENT STATISTICS IN UK 255 for on' despite receiving not benefit that are normally thereasons they temporarily in dispute abouteligibility to maintain or their national insurance contributions.Its mainweakness thatitis dependent the is on in administrative system placeat anypointin time. The count identifies those with active claims a particular ofthemonth.Thishas led to several disconin totalsince1982. of thathave necessitated changeto themethod a (b) administrative changes the and compiling figures madeto improve quality statistics. on day Inconsistencies in in comefrom overtime thismeasure changes thebenefit administrative system which determines willbe eligible be counted an active who to as claimon thatday.Theseestimates by only coverpeoplewhoseeligibility be in thecountis deemed have changed to to and . usually lags behind economic cycleby around6 months. being change their in thelabourmarket (i. speedand cheapness of involved the in its collection its highly and disaggregated nature. The final column Table of 1 givesthe GSS's estimates the size of the adjustment the claimant of to count at produced thesediscontinuitiesthetimeof thechange. The mainstrengths thecountinclude ease. PRODUCING CONSISTENT SERIES of TheGovernment Statistical Service (GSS) has laiddowncleardefinitions what a (in their view)constitute discontinuity Lawlor(1990)). the of (c) statistical changes The GSS has identified discontinuities 1979-theseare since eightsignificant in in detailed Table 1. Theseare (see in of (a) changes the rulesthathave led to a changein the number people in in a included themonthly without there status count. of whichthe adjustments November 1981. detailed The highly disaggregated natureof the claimant countoffers breakdowns thesex.Thecount on also givesa highly flexible and geographical disaggregation evidence uncompleted durations benefit of claims.BeforeMarch 1986 onlya one-week delaywas used whichled to overrecording the Employment (see GazetteforMarch-April 1986). A changein thesystem thenproduces newtotalfigure if it is lowerthan a and previouslybecomes it impossible track current to the status those of whowould have on beeneligible theold basis. gender. tinuities theheadline 3. 1988and July1989correspond thefirst theGSS's categories of to of September in the changes. of Compilation thedata is carried at of out thecomputer at centres Reading and Livingstone after three-week a delayso that thecountcan allow forlate notification 'signing by claimants of off terminating their claims.age and marital of status lastforwomen (the only). The speedof collection and releasemeansthatit is an important economic indicator which receives regular mediaattention. Therefore ability appearin thecountdepends theperson's the to on pastemployment history.e. is out The monthly countof thoseclaiming benefits carried at theUB offices on thesecondThursday each month.

1 plotstheSAUCCC series against at series each date forthe 1970sand 1980s. theabolition part-rate in 1986or thebarring schoolfor leavers from benefit up to 3 months from the 1983). It is worth in thattheUU includes rate noting changes theunemployment in which notaffect headline do the total(i.15500 TABLE 1 tSource. The differences between UU measure thecurrent the and claimant laid countwererecently out in The Times(1991) (see Table 2). is done by the has as GSS.Furthermore. a very task to reference monthly records backto 1971 time-consuming as itrequires how the series to (when consistent starts) establish many peoplehavebeenaffected at the by thechanges anypointin time. GSS has developed 'seathe the with consistent current sonally adjusted unemployment coverage (SAUCCC) series' a which of countto thecurrent Thisis updates back series theclaimant coverage. Lawlor (1990).Fig. to administrative the which notalter coverage do Anychanges thebenefit system An of thecountor entitlement benefits not considered discontinuities. p.Manyof thechanges those are identified theGSS.There also some are example to wouldbe classified discontinuitiestheGSS's as other changes thesystem which by in but too guidelines are considered insignificant their impact. is The excludes anyone to on if totalimpact thecountis thengreater thechange induced has peopleto take or employment a training place. 2 plotsthe SAUCCC series and theUU indexforthe 1980s. Fig. changes thebreadth coverage of of thedenominator).e. To takeaccountof themajordiscontinuities.190000 . 608.256 GREGG [Part 2.1986)). some men over 60 years old no longerrequiredto sign on Voluntaryregistration job centresintroduced:count switched at to benefitoffices Budget provisionsfor men 60 years old and over-no longer requiredto sign on Reconciliationof recordsfor NorthernIreland Delayed compilationto reduce overrecording New regulationsfor youthsunder 18 years old Change in redundantminers'conditions Impact on count +20000 -37000 . to are as would theintroduction restart be in of interviews 1986. .162000 -5000 -50000 -90000 . in whosestatus thelabourmarket deemed havechanged. Discontinuities the monthly in registrant and claimantcountt Date October 1979 November1981 October 1982 April 1983 July1985 March 1986 September1988 July1989 Source of discontinuity Fortnightly attendanceat UB officesintroduced Higher long-term rate of supplementary benefitintroduced. Thisis mainly becausetheUU estimates cover totalimpact thecount the on rather thosewhoselabourmarket thanexcluding status changed.g. UU identiin fies somechanges thestrictness benefit of entitlement criteria administration and of the benefit whichhave had an impacton numbers system claiming. published The UU has argued for and thatthesecriteria discontinuities too tight they are of identify number other a changes thebenefit to system which havereduced the claimant count UB of of (e. but thepredicted in is by impact often larger theUU series. These includerestart interviews the tighter and for availability worktest(see Taylor (1984.

namely administration thenational the benefit the of it system. 1.twogroups wereaddedto thedenominator: self-employed the and thoseon government training schemes such as the youthtraining scheme or employment The former as training.Thus the potentially official claimant count series remains opento political manipulation butnotthrough actionsof theGSS. counted were as in employment thediscontinuitynotgreat. they the had donetheir utmost produce to consistent reliable and figures.Yet. GSS itself been The ridiculed itspart this for in process ina meeting theRoyalStatistical and of Society's Official Statistics its Study Groupin 1991theGSS defended rolein thegeneration of numbers.given sourceof thedata.g._ 5004 71 73 75 77 79 81 83 85 87 89 91 of definition claimantcounton thecurrent Fig. to Hence. Theyargued that. First thosein theworkforce without fixed but a location cannot allocated be In shouldthearea of residence search (e. the Thedefinition thelabourforce of usedin calculating rates unemployment is also an issue. changeappearsfully justified the selfdo and employed makenational insurance contributions do movein and outofthe claimant count. is still possible thatthechanges thebenefit havebeen system withan eye to theirimpacton the headline designed total of the count. Comparisonof the Department Employment's of basis (SAUCC series) ( ) and registered unemployedin thousandsat the date shown (--------) It is thelarge of number changes coverage has beenthesource growing to that of of scepticism aboutthereliability unemployment has numbers.although is possible saythat GSS hasnotbeencompromised the it in bythisprocess. as students excluded. addition or activity .For thesecondgroupit shouldbe notedthatparticipants forein runners employment to training as thecommunity such programme.In 1986. problem The comesfrom source a of outside control theGSS. thearmed forces).1994] 4000T 3500t 300025002000 UNEMPLOYMENT STATISTICS IN UK 257 / 1000-A. final One issueconcerningthecalculation ratesoccurs of whenwe consider geographically disaggregated data. so is are thosetraining basic subsistence for (benefits ?10 to coverwork-related plus costs) out in appear oddly ofplaceinthe'workforce employment'.

-/ 2500- \ '.So. Comparisonof theDepartment Employment's in ) and the UU index (--------) thousands basis (SAUCC series) ( on area maynotbe thesame?Theappropriate willdepend what be counted they as or of concentrations excesslaboursupply is aspectof unemploymentof interest. guess-work. adoption historical the series thisdebateoverthechoiceof unemployment highHowever. it includes significant In to it peoplein itsderivation. 2. the require use of secondary discontinuities not as thosechanges included official initial impacton the count.258 4000 GREGG [Part 2. sourceof another yearslater. 3500-. benefit dependence. ALTERNATIVE INFORMATION SOURCES have data on unemployment led to the The limitations theregular of timeseries into in to use of alternative sources information an attempt gain insights the of .- / 2000- \ 82 83 84 85 86 87 88 89 90 91 of definition claimantcounton thecurrent of Fig. the of the behind generation theUU indexis to highlight The mainmotivation in of citedmeasure unemployment sizeof thepastadjustments themostwidely to First. 4. the that estimating number wouldstill affected it overtheyears. of seriesis a measure aspectabout the count-neither a lights moreworrying in use unemploymentthesensethateconomists theterm. appropriate.thoseno longer information gaugetheir to place. a of number notional basisis on of series thecurrent statistical sensetherefore. 3000. However. UU index somemajorproblems itsgeneration.Second. Furthermore. is impossible disaggregate. in has the theUK. UU indexis clearly imprecise The potential a as error by proneforpublication theGSS. is difficult changes with many so on educated Third.producing to assesshow they mayhave interacted wouldbe too which estimate an error. has after be normally identified a change taken cannot benefit receiving may of of an although estimate theimpact a changeat thetimethatit occurred later relies someyears be be possible.

1. count.30000 .1994] UNEMPLOYMENT STATISTICS IN UK TABLE 2 countingmethodssince 1979t Changes in unemployment Change Yearof change 1979 1981 259 alteration Estimated +20000 -20000 . UU. the This is beingconstructed.30000 madefortnightlyt payments Benefit total to adjustment seasonal Downward or peoplein training of estimate effect removing of First work temporary at effect the the adjusted offset strike to Seasonalfigures of Department Healthand Social Security old required Unemployed 60 years and olderno longer men to signont benefit shifted supplementary to parents UB taxed:single counted: claimants Onlybenefit eliminated job Part-time hunters no to Men60 years and olderand notentitled benefit old insurance national to to required register receive longer creditst long-term All men60 years and olderallowed old benefitt supplementary for from benefit 1-3 months barred School-leavers rules Community programme changed of Ireland Department Healthand Social Security Northern of with records reconciled Department Healthand Social files Security UB paid in arrears of into delayintroduced announcement statisticst 2-week 0o of Newmethod calculating unemployment UB of Abolition part-rate extended 13 to disqualification unemployment Voluntary weeks for toughened tests and Restart availability work to extended 26 disqualification unemployment Voluntary weeks of work Definition part-time toughened No used Newdenominator to calculate unemployment from old Youths16 and 17 years barred benefitst tests UB contributions toughened instead of old Somepeople55-60years paid pensions benefits to not Ex-miners required registert for are to Claimants required provethatthey looking work a no Low wagelevels longer good reasonforrefusing job to for of Tightening regulations requalify benefit to right benefit to affect Change thewaythatearnings 1982 1983 No estimate -216000 No estimate .it provides of into state the employment thatpeople exitinto and the likelihood re-entry et (see unemployment Narendranathan al.30000 the tSource.38000 -30000 1986 1988 1989 -28000 -25000 -25000 -350 .evenifthey of all newclaimants a certain to into valuableinsights propensities leave the count.Hence.407o .107000 -54000 1984 1985 -200000 -29000 -5000 No estimate -50000 . (1985)).12000 No estimate No estimate -120000 . of in methods unemployfrom change counting the estimate thesizeof theeffect of Department's tEmployment in ment figures given Table 1.3000 -300000 . .195000 -20000 . -cohorts fall Thesedata sources intotwotypes of characteristicstheunemployed.The third currently the haveleft in weekforup to a year. monitors progression 15 years. in within claimant count thelast the There havebeenperiodic cohorts and surveys.

which itis to with associated sample Furthermore. The most (see forinstance which covers wholepopulathe comprehensive survey thecensusof population is in data to weights enableaggregation. The mainproblem abouttheLFS was thatuntil1992 sex. This meansthatthegap between administo unemployment-related in for and measure muchlarger women theUK than is trative measure thesurvey in countis higher in othercountries. Thereare also variations thequestions makea historical asked. subject theerrors series problematical.Keynes (1937)developed concept 'involuntary to describe economic an definition unemployment.Suchcomprehensive are useful generating level.Developing statistics availableratesof pay and who wereunableto secure difficult this produced internationally tomeet sucha concept obviously is and has an of as measure unemployment the through ILO and OECD. Hereevidence job search usedas are waiting start job already a measure thedesire workat availableratesof pay (see Hussmans of for (1990) fordetails). 5. it usesentitlement agencies.raceand broadregion. the became was available. we are interested unemployment two (1976) pointed indicators measure to excesslabour reasons. The The mostimportant in LFS surveys employment of 60000households thespring eachyear. the state of it population. search previous economic state.We require economic quitedistinct in and to of market policies theamount supply theeconomy judgethesuccess labour . tionof other surveys to national up for and registrant measures unemployment have both survey Most countries and butin thosewith surveys (USA. short.The great and delaybefore results surveys there a year's on of unemployment an approachis thatit can measure advantage the survey result themachinations of internationally accepted basisand as itis nottheindirect of it of thebenefit any concerns manipulation.260 GREGG [Part 2. Family Expenditure Survey theGeneral in individuals households and between of address issues benefit uptake interrelations Dilnotand Kell (1987) and Kell and Wright (1990)). in for As Worswick out. thanthe survey-based searchmeasure. intensity. available start are to unemployed peoplewhohavesought plus not workwithin weeksand are currently in employment thosepeoplewho 2 of is to a attained. unemployment. for on is the survey information unemployment LFS. the UK thisis not normally The in and Netherlands also unusual thisrespect White Leyland is (1992)formore (see details). Thisdefines accepted in work thelast4 weeks. Australia Japan)relatively monthly less surveys measure. of In thisconcept was whowanted work thecurrently at basedon theideathat unemployed those the were work. Among thosewith frequent little is madeoftheregistrant use role and is based on registration at the registrant measuretakes on a greater as The UK is theexception. can assess search As it is drawnfromthe wholeof the British as occupation wellas age. whereas mostcountries registrant the So. POVERTY OF UNEMPLOYMENT STATISTICS in any of sense all Theconcept unemployment meaningful doesnotinclude those unemployment' the of notin work. government employment the benefits. Canada. annually and forthe yearsbefore1984it was only it had been onlypublished in biennial. system is freefrom useful information as the such are provide Othersurveys also availablewhich and Household Thesesources can Survey. for so.

are not The Department Employment the of for searching workand giveas themainreasonforinactivity shortage jobs from little available. they of measure coversthosewho wantwork. (f) theeffects benefits. of working roseby6. Social scientists wantinformation on therefore in of workand competing thelabourmarket (a) thenumbers peoplewithout (excesslaboursupply).previous and expected duration likelihood of into (c) thelikelihood entry unemployment.However. of schemes on theabove. work. by The discouraged worker idea is a usefulconceptto coverthose for whom is stillan undesirable by statebutwho are notcovered a measure unemployment of used definition of excesslabour supply. believe cannotfindit' (International LabourOrganization. groups for (b) theincidence unemployment different or industry occupation.e. on overfairly to timecomparisons constant longperiods facilitate as between unemploymenta measure thatthere tensions are It is worth noting For for and any ofexcess labour supply as a socialindicator.As Metcalf defined muchmorethanconventionally varies acrossa business cycle employment 1984and 1990theemployment among population the rate Between unemployment. available. Thiswas a periodof relatively change thesize of as is by participation work the population and thisdifference driven increased becamemorereadily available(the encouraged worker and longer-term effect) for trends increased participation women.Hence. age.we are also interested and the measure socialdistress alienation unemploymenta socialindicator-to as associated with joblessness.1994] UNEMPLOYMENT STATISTICS IN UK 261 in in of disequilibrium the labour market.5 o. etc. of and into re-entry unemployment the labour (d) the likelihood repeated (i. government in concepts in covered these by Furthermore. areinterested changes thenumbers we coverage.thereis no commonly of workers. race.Consequentlyis useful introduce seeking thosewhowouldtakeworkif workwereavailablebut are not currently workers'. of exit. Instead they a measure likely measure excess labour to thelabourforce whenworkis morewidely (1984)notes.knownas 'discouraged but not be the are should included among unemployed they clearly partofa current future entrants are of of supply.thismeasure usesonlylabourmarket to rather thanpersonal such as age or qualifications assess discouraged criteria . of according their to sex. market statewhennot unemployed flows of and (e) theintensity job searchand its variations. ILO manualon definitions unemployment The suggests discouraged thatalthough concept not precise the is to who wanta job and are 'the termdiscouraged workers refers persons generally for search work for because available work whohavegiven anyactive but up currently thatthey 1990). in criteria to justunder100000 1992. between states). Thisnumber typically varying a over200000in 1986 is small. person whom benefits theprimary are sourceof incomeand who wouldtakeworkif it were in available of interest thesocialsenseirrespective whether are currently of they is to it another to concept cover for searching work.4% buttheunemployment among samepopularate the age in little tionfellby only3. instance.However.Knight (1987) arguedthatthesepeople.

8 9.8 6. definition Number of people who were not counted as unemployedon the ILO-OECD but stated that theywould like workt Reason Men (thousands) 148 460 608 Women (thousands) 165 1180 1345 TABLE 3 All (thousands) 313 1639 1952 Seekingwork but unavailable to start Not seekingbut want work Total Reason statedfor not searching(%o) Temporarysick.3 to status. on tThe 1979 figureis inactivity the old labour to force definition. .LFSs 1979-91and Employment September1992. spring1992.9 14. analysing and monitoring unsatisfied demandforwork.4 2. 11.3 10.4 9.6 million peoplenot currently but of for that wouldlikework citea widevariety reasons searching indicated they this broaddefinition discouraged of notsearching Table 3).4 8.9 9. source.8 3.The sharpgrowth inactivity among with coincidence 1979and itsapparent cyclical (negatively) menand women after in which movements claimant unemployment.262 GREGG [Part2. Although is a very (see changesin the size of this group may workers.fellbackuntil1989 Economic inactivity ratesin the UKfor men aged 16-64 years and women aged 16-59 years otherthan studentsor those looking afterthe homet Year Women (No) 3. nevertheless an insight offer intothewider for afterexcluding inactivity Table 4 givesthe timeseriesfigures economic in the students thoselooking and after home.0 6.8 9.9 8.9 5.This makes littledifference the overall impression.6 9.3 44.4 10.6 TABLE 4 1979t 1984 1986 1989 1992 Gazette t Source.3 3.6 8.3 7. 1992 LFS.1 5. peakedin 1986.5 7.5 61. on holiday or awaitingapplicationresult Student Long-term sick or disabled Looking afterfamilyor home Believesno job available Not yet startedlooking Other inactive tBritain.1 6.6 11. Yet in 1992(according the LFS) over 1.8 48.2 4.2 Men (No) 4.5 19.5 4.

the monthly claimant countdoes not measure international the definition unemployment well. LFS t ILO-OECD definitions.andLabour p. between Hence. TABLE 6 Claimantstatus in relationto all adults not workingt Category Participation ratet Claimants? as searching % of all searching 80 44 66 Claimants?? as wanting % of all wanting 34 9 17 Claimants wanting not as % of all not wanting 4 2 2 Male Female All 73. ASSESSMENT OF DATA AVAILABLE So howefficient theclaimant is countin enabling to analyse us these issues? As alreadynoted.source. spring rate working searching ILO definitions a percentage theadultpopulation. unemployment Thispoint further is brought bytheinformation changes economic out on of state between in theLFS.9 1992. For 26%Vo of thosewhowereinactive becomeactive(19%Vo employment) 13%Vo in had and of those a unemployedyearbefore werenowinactive. about24%Vo women whowereinactive 1990wereactive 1991(18%Vo in employment) 20%Vo theunemployed inactive year and of were a later. 1992. men.8 62. ??Unpaidfamily members in included notwanting work.Table 5 showsa breakdown thepopulaof of very tionof working by claimant age statusfor1992. 537. Amongthepopulation working 1990and 1991contained of of in in age. tBritain. Employment Gazette. ?Thiscategory excludes those seeking work ILO definitions includes on but those seeking work unable start but to in thenext2 weeks.thedistinction inactivity unemploymentoften and is slight. excludes ??Thiscategory thoseseeking work ILO definitions includes on but thoseseeking work unableto but in 2 start thenext weeks. ForceSurvey Quarterly Bulletin 1 and unpublished data. implies thesocialimplications theshortage This that of of work mayneeda broader thanconventional analysis measures.1994] UNEMPLOYMENT STATISTICS IN UK TABLE 5 Breakdownof adult population by categoryof economic activityt 263 Status Claimants (thousands) 320 1760 330 200 2610 Non-claimants (thousands) 24565 890 1622 14368 41444 Total (thousands) 24885 2649 1952 14568?? 44054 In employment Seeking work4 Wanting work? Not wanting work calculations madefrom November t Britain. no. spring 1992. . or on as of tTheparticipation is those ? ILO-OECD definitions. androseagainsubsequently. 6.8 52.

. remains rateof changeof excesslaboursupply were900000 of there reasonable indicator thedirection change.Table 6 shows. disaggregations.However.98 2. malesmostof thosesearching claimants butfor 40% claim.34 1985 2.50 0. from 1971 and 1981censuses results the The NationalInstitute (1983) reported in Theclaimant register also which indicated suchinstabilities existed the1970s.37 1991 2. more malesarealways ofthose wanting work all.For instance.07 measures and claimantunemployment for Britaint Measure (millions)for thefollowingyears: 1986 2. that measured an the roseby 1.25 1992 2.59 0.89 2.264 GREGG [Part2. for are as Furthermore.91 0.10 1989 1.05 0.11 2.65 million two-thirds and was thefact that number peoplebothclaiming searching only the of Thismeansthatabout850000claimants werenotsearching of all thoseclaiming. of ILO-OECD Time series 1984 ILO-OECD Claimant ILO . of to is Consequently there a largegroupof peoplewho are common boththe This of whoaresearching. make unreliable.08 1988 2.in 1984an estimate theILO-OECD the see thanthe for measure theunemployed of searching workwas about340000higher so the count was 10000 had beeneroded that claimant claimant count. of countand theILO-OECD measure those Although totalsfortheclaimant this and respectively).06 TABLE 7 t Source. Acrossall these at categories not are Therefore.Claimants constitutesizable a minority women around also only smallproportion of thosenotsearching workbutwanting buta relatively for it.98 2. Women are similar. doubt is inpart but therestart initiative encouraged etc.Theyattributed (broadly speaking measured in of mostof thedifference thisperiodto an increase thepropensity women over to register. ensures unemployed claimant count a measure those and will movein thesamedirection that twomeasures theunemployed normally the of to divergences but the differences sufficiently are important producesubstantial of between twoseries.31million theold labourforce of on in this active search thelast2 weeks). The claimantmeasureis the SAUCCC seriesdescribedearlier for the same period as when the LFS was carriedout (March-Aprileach year). ifthetotalfigures broadly even likely be claimants to thanfemales.01 1987 2.81 0.98 1. obscures seeking work similar are (2. for forwork(or werein employment) 890000weresearching workbut not and claiming benefits. 1986this By was higher reversed and againby1990and theILO-OECD measure 370000higher.65 2.claimant 3. it still series thecounthas proved poorguideto the of a implies eventheconsistent that it a overthisperiod. of but for menconstitute two-thirds thoseclaiming not searching work. searchactivity amongclaimants. sexin particular.LFS HistoricalSupplement.28 0.87 1.99 -0. highly by but for and for up around two-thirds thosesearching work noteligible benefits.61 million 2. April 1993.77 0. unemcountand themeasure search of The relationship between claimant the in No this because ployment beenhighly has unstable thelate1980s.23 1990 1.68 million between thesetwo dateswhereas censuses unemployment definition search of increase 1. Table 7. Hence.75 0.38 2.30 2.

is probableforlong-term as in decisions However. whichforthe is Finally. willenableus to overcome overhaul unemployment the many the will of for The source newinformation this process be the pastproblems. budgetary important government payments highly are of a countas a measure benefit on thesecriteria sole reliance the claimant on whenout of workis inappropriate many to as peoplewillbe entitled dependence the work or benefits still want (e. a a good historical seriesformanyissueswhichmakestimecomparisons mire. forwe now have an opportunity is as of This statistics. if (perhaps becauseof amongclaimants reinforcedan intensity search greater of is thethreat benefit of as (1991). withdrawal). LOOKING TO FUTURE 1987-90. This breakdowns. Fromthe spring 1992the previously of annualpublication new quarterly . muchof the information onlyavailableat intervals. decision-making. knowrelatively about we of thisstate. 7. and regional series onlyavailablefortotalmales. benefit benefit dependence.1994] UNEMPLOYMENT STATISTICS IN UK 265 over who ceasedto be unemployed theperiod peoplecommon bothmeasures to of can breakdowns the as Using count a indicator socialdistress giveus detailed in of benefit flows and out and and by sex. principal LFS.age. have an imperfect of how.Consistent reliable and duration patterns instance. if there a significant in from the variation unemployment be different the may benefits. consistent seriesforeach area of potential if with of may Benefit dependence be a good measure socialdistress associated Furthermore. are of for definition unemployment. etc. geographical of claims. notably speedof collation helpsin national local and This disaggregations. poverty. compare with those a broader howthese indicators for A moreserious official sources seriesfrom is problem thelack of consistent idea we Consequently. the there a longlag before and is cohorts very are claimant longintervals. alternative and if the mayoccurfrom absenceof benefits no alternative greatest social distress sources income available. geographical distribution benefit for In addition progressive since1986to tighten criteria availability the moves the with introduction a committhe of forworkforthereceipt benefits.Evenherethere problems. to The future not as barren the past. in to is variation thepropensity claim Yet.Furthermore. have changed overthe 1980s. Between has they butthesplitbetween sources makesinteractions Theyfailto produce impossible. thedisabled sick). often is information released. of are and its its The claimant countdoes have strengths. of combined the countand ment search workmaymeanthatthegap between claimant to for will This improvement be has a measureof searchunemployment narrowed.g. foundby Wadsworth suchas theLFS give data sources of Does thecombination thecountand other in of and consistent a reasonably robust time picture unemploymenttheUK? The covertheissuesthatwe wantto analyse them answer to be no.females are and of information due to the difficulty cost of constructing is paucity reliable interest. feature potential geographical for for receipt oftena usefulcriterion is and indeedbenefit government planning. for manyof thesemeasures. duration region thoseclaiming little First.

of the given newdata sourceand the conflict between statistics measures excess as of unemployment 266 GREGG . None of thesewouldbe a of measure trueunemployment becauseof a lack of a uniquedefinition 'true of unemployment'. each designed to be of use in different circumstances (Shiskin. willcoverall aspectsof the sex. to LFS. of in we the concerning incidence concenand of It tration unemployment. In it addition. addition thenewquarterly from of of to LFS (In 1994the new computerized claimant countserieswill also provide of measures occupational unemployment thisseries. are they deemed sufficient produce to seasonaladjustments relevant for series. has beenadoptedin theUSA (see Sorrentino This (1993)). several problems leastin theshort (at run)associated themove thequarterly First.theshort timeseries. (An estimate search of in 1984buton a different unemployment included theLFS before was definition in of search thelast 2 weekscalledthe'GB labourforce measure'. Indeednotation could be borrowed from these data. Ml etc.In thiswaytheir can progress therefore monitored. in Changes themonthly claimant countcan be usedas first approximations of in on changes searchunemployment internationally definitions. can provide insights intopeople'scharacteristics not in workand evenwhennot searching when for work.Although wereconsidered smallto warrant too samplesizesinvolved publication. This technique for should of enablethe creation a back seriesat leastuntil1984. timethequarterly willprovide over LFS timeseries measures of most theissues which areinterested. former Commissioner Labour Statistics.amongother things. Sucha system advocated theUK byMiller was for used (1988)and is currently in the UK formoneysupplyfigures (MO. is Thismakes thedistinction between in structural of cyclical changes problematical an analysis thedata.). (Seasonalvariations theILO-OECD measure unemployment been in of have data computed using by unpublished the quarterly availablesince1984.In 1976Julius Shiskin.[Part 2.though can be partly this overcome using cross-sectional by the variation.Therefore will any discontinuity between figures onlyhave a shortrunimpact. Subseaccepted quently these would revised quarter be each when LFS results the comein.) with Thereare.however. a US for raisedthe idea of alternative of measures unemployment different for needs. 1976). frequent the measurement search of unemployment.This is a in common technique deriving statistical andis already data usedbytheOECD and EEC in ascertaining unemployment estimates theUK. thisallows for. Thisnewsourceof information raisesanother potential insight unemployinto ment. a much shorter lag before and publication.means that relatively time little series analysis possible. evenif data back to 1984areused. a survey all individuals notjustclaimants. age and previous occupation characteristics theunemployed. A revival thisidea is opportune. offers opportunity put the unemployment an to statistics beyond suspicion political of intervention.) for The remaining issues flows of between exit and rates states. in sampling variation a survey measure means willbe a margin error thatthere of aroundthecentral estimate any chosen for in measure. be as of and it Finally. Second. He advocated establishment several the of alternative measures. Thiswilltakecareful monitoring theshort until likely term the bounds forerror becomeestablished. wellas unemployment of as duration andmeasures intensity job search. probabilities re-entry canbe addressed oneother feature by key of thenewLFS: a moving will panel in which individuals appearin up to four LFS consecutive samples. with became time quarterly.) Furthermore.

and Social SecurityStatistics. claimant The counthas the feature it is a that measure bothexcesslaboursupply of and social distress. perhaps or 1 3 months.g. a poor measure but of both. be The is first that derived from LFS forsearch the unemployment international on definitions. through The dependence benefit themainsource income on as of among population the of in working rosesharply the 1980s. 1980-91t Benefitrecipients Men (thousands) Women (thousands) Total (thousands) TABLE 8 iS 1991 1989 1986t 1980t 616 526 368 138 1020 891 807 800 1130 981 732 432 472 374 267 255 1746 1507 1100 571 1492 1265 1076 1055 Sicknessand invalidity 1991 1989 1986 1980 tMen 16-64 yearsold. women 16-59 yearsold. Claimantstatusis as definedat the t Supplementary point in time. because they believe no work available). source. . Employfor The ment Department's definition discouraged of workers very is narrow thetotal and number peoplein theLFS indicating they of that wantwork maybe too expansive as itis unclear under whatcircumstances wouldstart they searching work.Therefore.1994] UNEMPLOYMENT STATISTICS IN UK 267 laboursupply and social distress. wellas those for and not as receiving invalidity sickness and benefits.The for Employment PolicyInstitute (1992)advocates broader a measure excess of labour which supply wouldinclude current the ILO-OECD measure plus claimants who statethattheywantworkand non-claimants are classified discouraged who as workers those whodo notsearch (i. alternative two of measures excess supply should produced. discouraged workers) and thuswould reflect number jobs the of needed be created absorb current to to the unsatisfied desire work. The numbers sickness invalidity on and benefits have risenby around400000 since1986after having previously stableand IS claimants in theclaimant been not not includedin the claimantcount. details thenumbers of claiming butwhoarenot IS considered available work hence unemployed. A broader measure socialdistress of absenceof workis also required. that is In addition wouldbe reasonable includethosecurrently it to searching not but for available start 2 weeks to -in 1992these groups numbered around900000.An alternative wouldbe to ask thosenot currently searching workwhether for they intend search to and wouldbe able to start workin a future period.e.1993. benefit rather than IS applied in theseyears.The risein claimant age unemployment is only Table 8 gives partofthisstory. Thisshould thekeynumber economic be for commentators theUK labour on market. broader A measure excess of supply should include potential labour market entrants (e.Annual Abstractof Statistics.various years.

shouldbe replaced thekey Although claimant in on measure internameasure excesslaboursupply theeconomy a search of by tionaldefinitions. However. GREGG 8. in reality of of wouldprovide information differing on aspects theeffects lackof indicators workon theUK's economy and society.it should not be the and unemployment its to principal sourceof data whenwe are trying understand an effects. of A measure widersocial distress to shortages availableworkshould due of in where absenceof workor a shortfall thedesired an include family all members low income. nonhave earnedincomesand would includeall thoserequiring and to level benefit) raisetheincome claimant family credit.2 million.withrespectto unemployment. is unemployment.although or it to thatsickness and will the families increase IS dependence. in possible. work oneormore lack from lowbasecausedthrough ofavailable the although theywould This measure wouldbe calculablefromavailablesources. all these the by count haverisen steadily towards single-parent to socialtrends are available wanting workbut.None of thesemeasures Insteaddifferent for there no suchuniquemeasure. Although GSS has notbeeninvolved anyunreasonable from this that datahavebeenfree the of manipulation thestatistics.This is at least partly determined Ministerial by decisions. is difficult believe in disability rising dramatically theUK. This is of amount workby one or moremembers causing household is where member out of workwhileothers one wouldthenexclude thosefamilies benefits (e. wouldusefully supplemented a broader be of This by measure of distress of causedby theunsatisfied demand workand a measure theextent for the alone wouldascertain levelof true absenceof work. CONCLUSIONS in in In the 1980stherehas been a deterioration the usefulness the monthly of majorissues concerned used claimant count a source information forstudying as in the with unemployment. it as the countshouldcontinue. invalidity sickness IS. Wherever require details income other in in disaggregations linewiththecriteria Section2 shouldbe made.268 [Part 2. for members. datasource independent. for The claimant countis usefulforits speed of production. to the to credibility relation unemployment It also offers potential answer to broaderquestionsof interest social scientists and others. of and extra questions theLFS. Not throughout 1980s around1. was of incarnation thecount-which in thanlooking backto a previous Rather to shouldgo forwards a of unemployment-we itself poor measure underlying on questions the new quarterly LFS the primesource for answering making which totally statistics are This produces unemployment unemployment. new quarterly The LFS provides opportunity the GSS to regain for in data. . The mainreasonforthisincrease are so have (see into is thelonger durations claimsas outflows employment declined of Disneyand Webb (1991)).g. its local detail of on and measurement dependence benefits. has notmeant This interference. is becausethe raw data are not underthe potential political rules to on control theGSS butdepend theadministrative forentitlementbenefit of in forceat any pointin time.

(1991)Whyare there many R.. AndrewBritton. (1990)International R. of standards themeasurement economic on Hussmans. Turvey)... (ed. on forcomments a previousdraftof thispaper. and Dilnot. 252-263. out PolicyInstitute (1992)Figuring unemployment. 8. (1987) Male unemployment women's 1-16. Econ. activity. London:Pinter. 101. All the seriesin Figs 1 and 2 were providing Dr David Taylor of the UU. Employment employment.S. no. sickin Britain? so longterm Disney.Fisc.1994] UNEMPLOYMENT STATISTICS IN UK 269 ACKNOWLEDGEMENTS the Editor and the referees I would like to thank Paul Allin. In Developments International LabourStatistics R. and Kell. no. 2. May 1980 September 1982 December 1982 June1983 August1984 1985 July October1985 1986 March-April October 1986 1988 January October 1988 December 1988 August1989 1990 October December 1990 November 1991 1992 July 1992 September June1993 'A review unemployment vacancy statistics' and of of statistics' 'Compilation theunemployment statistics' 'Changed basis of theunemployment for withthe 'The unemployed: estimates 1981compared survey monthly count' for withthe 'The unemployed: estimates 1983compared survey monthly count' and adjustedfordiscontinuities seasonality' 'Unemployment estimates fromthe LFS comparedwiththe 'Unemployment: count' monthly claimant of unemployment 'Change in the compilation the monthly statistics' the count theLabourForce and figures: claimant 'Unemployment Survey' and of 'Measuresof unemployment the characteristics the unemployed' of and 'Measuresof unemployment the characteristics the unemployed' to revisions the seasonally adjusted statistics: 'Unemployment series' claimant countand Labour Force of 'Measures unemployment: Survey' of 'Measures unemployment' a series' statistics: maintainingconsistent 'Monthly unemployment countand Labour Force claimant 'Measures unemployment: of Survey' claimant countand Labour Force 'Measures unemployment: of Survey' in countries' is 'How unemploymentmeasured other of 'Characteristics theILO unemployed' REFERENCES work. by APPENDIX A the Gazette concerning from are references theEmployment The following someuseful of comparisons withthe LFS measures unemcount(including monthly unemployment ployment). J. and Webb. 7. M. Sept. Econ. Rep. and in unemployment underemployment. 3. . Stud.A.

Econ. and p. Apr. Keynes. summer. Q. M. and Wright.. London. West View.New York Times. (1993) International C. Emplymnt White. numbers. Narendranathan. and searcheffort theUK labour market. J. Unemployment Underemployment: Manualof Concepts Methods. J. Rev. G. (1990) Monthly unemployment 98. (1991) Unemployment 58. Jan. International Labour Office. 601-608. and Boulder: of Unemployment. (1985) Unemployment W. 17-34.Unemployment Bulletin20. 107. International Labour Organization(1990) Surveysof EconomicallyActivePopulation. (1992) How unemployment measuredin different Gaz.. and Natn.J. London: Croom Helm. Taylor.. Rev. Econ.. Lawlor. and Stern. (1986) Creativecounting. 119-126. National Institute (1983) Unemployment. benefits Economica.. and thelabour supplyof womenmarried unemployed to men. UnemploymentUnit Bulletin 11. Econ. London: Atlas Economic Research Foundation. Econ. D. 307-329. of Metcalf. Inst. benefits revisited..R. Sorrentino. no. Aug. Unemployment Unit. Nov. 100. 59-67. is countries. Wadsworth. Mar. 19th.. and-Leyland..K. 39-47.. (1976) Shiskinon the unemployment of indicators. Inst. Nickell. Natn. 109. M..D.J. Kell. an a statistics: maintaining consistent series.S.J.270 GREGG [Part 2. 100.Unemployment The Times (1991) The Times. J. J. Employment. (1987) Unemployment: Economic Analysis. (1984) On the measurement employment unemployment. 95. Shiskin. (1988) The End of Unemployment. (1937) The generaltheoryof employment. 421-433.. (1976)TheConcept Measurement Involuntary .. (1990) Benefits Econ.A. (1984) The unemployment numbers game. in J. N. Worswick.Emplymnt Gaz. Jan. Unit. Rev. J.Geneva: and an ILO G. comparisons unemployment 3-24. Knight. London. Feb. D.J. MthlyLab. Miller. 18th.

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