Introduction to Business Demography - UNECE

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					                           Linking administrative and survey data -
                           employment variable for enterprises and
                           establishments in Finnish Business

                                           Jaakko Salmela
                                           Statistics Finland/ Business Register

Jaakko Salmela
Statistics Finland
Business Trends/ Business Register
P.O. Box 3B
Fin- 00022 Statistics Finland

Tel:           +358 9 1734 3454

n   Employment variables in BR

n   Administrative data

n   FTE estimation of paid employees

n   Headcount estimation of paid employees

n   Estimation of entrepreneur employment figures, FTE and HC

n   Allocation of the enterprise level employment to local-kind-of-activity-

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Employment variables in BR
n Two main employment variables
    l Full-time equivalent: labour input equivalent corresponding average

      working hours within industry
    l Headcount: actual number of persons working in certain period

    l 3 persons working half time throughout the year

         l 1.5 in FTE

         l 3 in HC

    l Problems: operating periods, no exact dates for working periods,

      part-time, temporary, ...
n Separate variables for paid (wages & salaries) and entrepreneur labour

    l If entrepreneur’s compensation taken out from business in form of

      common wages, he/she will be counted as ‘paid employee’

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Administrative data
n Annual wages and salaries data (Tax Administration)
   l Core of all employment figures

   l Based on annual declarations of paying unit. Information about paid

     wages and salaries, tax withdrawals, type of work relation taxation
     status, benefits, etc., etc.
   l Contain link between paying unit (LeU or natural person) and

     receiving natural person by working relation.
   l Missing information: starting and ending dates of each work relation

n Pension insurance scheme files for entrepreneurs (Finnish Centre for
   l Paid (“saved”) pension insurance by paying unit (LeU or natural

   l Not always direct link to “enterprise” which is true payer of the

     pension insurance

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n   Other administrative data and registers
     l The registry of completed degrees (Education statistics)

     l Occupation code from

        l Public sector : registers kept by municipalities and state

        l Private sector : employers’ organization (via Salary statistics)

        l Other sources : Social Insurance Institution, Bank of Finland,

          occupation survey for small enterprises, additional information
          from wage- and employment surveys

     l   Survey on enterprises with multiple local kind of activity units (in co-
         operation with employment statistics)

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FTE estimation of paid employees
n Forecasting persons labour input by legal unit
   l Expected value of wages explained by person’s and LeU’s indicator

     variables: LeU activity and sector code, location of the workplace,
     person’s occupation, education, age and gender
   l Persons labour input calculated by dividing real (paid) wages with

     expected value of wages
n Before fitting the model ‘cleaning’ of data

   l Only principal jobs accepted

   l Continuous principal work relation from previous year

   l Wages>=40% of overall median

   l Median annual wages by occupational category restrictions

n Estimation of the FTE /person / LeU

n Aggregating FTEs by LeU

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Headcount estimation of paid employees (1)
n Tax file + FTE estimation labour input by person by LeU + operating
  periods from VAT&PAYE data
n Idea is to define first what kind of working relation certain individual has

  in linked LeU: Full-time job, part time job, change of full-time job,
  temporary job. By using
    l Principal/secondary job status

    l LeU operating time

    l One/ many paying LeU’s

    l Continuity of the job from previous year

n Straight forward decision making by job type and operating period

n Total HC count is compiled simply by aggregating employee level HC’s

  by LeU.

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Headcount estimation of paid employees (2)

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Estimation of entrepreneur employment figures,
FTE and HC (1)
n Flagged entrepreneur wages in Tax file
n Entrepreneur pension insurance files, missing PIN-LeU link

n Additional tax files, owners and partners of LeU’s

n Problems: 1) in which LeU does the entrepreneur work as

  ‘entrepreneur’, 2) what is his/her actual labour input in this LeU
n Matching insurance file persons step-by-step against

    l annual tax file, flagged entrepreneur work relation type (principal

      and secondary)
    l secondary ID for BR legal units with positive turnover/ agricultural

    l tax partner files where PIN flagged as active partner

    l ownership files, only unique PIN-BID relations accepted

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Estimation of entrepreneur employment figures,
FTE and HC (2)
n Entrepreneur HC: Linked persons

    l Compiling theoretical maximum for entrepreneur labour input

      = 1 – FTE of person/LeU . Aggregate by LeU
    l Compiling statistical maximum FTE for entrepreneurs by relating

      industry average turnover per person indicator to LeU’s derived
      indicator (total –FTE paid).
    l Selection of smaller of these two

n Pool of non-linked entrepreneur’s allocated to small LeU’s where
  turnover/person employed too small compared to average.
    l From statistical point of view OK

    l From register maintenance point of view?

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Allocation of the LeU level employment to LKAUs
n How to allocate LeU level employment to LKAUS?
   l Single LKAU enterprises → no problems because LeU=LKAU

   l Multi-LKAU enterprises

        → what is the aggregate number of persons?
        → who is working where?
n BR annual inquiry to all multi-LKAU enterprises

   l Joint data collection with Regional Employment Statistics where BR

     maintain the structure of the LKAUS and RES collect LKAU –
     person link
n Central and local government units treated separately

Person-LKAU link together with well established registers and
  administrative data enable register based production of versatile
  business and social statistics. Among others register based populaiton
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            Thank you for your attention!

Jaakko Salmela
Statistics Finland
Business Trends/ Business Register

Tel:      +358 9 1734 3454

                                            4/10/2014   12

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