Employment Statistics (Hansard, 28 April 1983)

§ Mr. Alison

Provisional figures for Great Britain show reductions in the numbers of employees in employment of 626,000 in the year to December 1982. Of this fall 235,000 were in service industries. The results of the 1981 census of employment, published last December, showed that the provisional series had been underestimating the level of employment, mainly in the service industries, particularly because it failed to allow properly for employment in new establishments. The census showed that between June 1978 and September 1981 employment in the service industries rose by 214,000 in contrast to the fall of 252,000 that had been indicated by the provisional figures. It is likely that the current provisional quarterly series is similarly undercounting service industry employment and overstating the reduction in the number of employees during 1982. The 1983 labour force survey will provide an independent source of data early next year from which revised estimates of changes in employment since the 1981 census of employment may be derived.

The latest information on self-employment is for 1981. It is estimated that there were 2,057,000 self-employed persons in mid-1981, an increase of 215,000 since mid-1979. In the absence of more up-to-date information, an unchanged level of self-employment is assumed in the calculation of provisional working population figures for periods after mid-1981. It is probable, however, that there has been some continuation of the upward trend between 1979 and 1981. The results of the 1983 labour force survey will allow the self-employment estimates to be updated to 1983.

The total for the working population is obtained by adding together the figures for employees in employment, the self-employed, Her Majesty's forces, and the monthly unemployment count, excluding students. This total shows a fall of 315,000 between December 1981 and December 1982. This fall is affected by the likely overestimate of the fall in the number of employees in employment, and the assumption of an unchanged level of self-employment when there may have been some increase.

Mid-year estimates of the size of the labour force—in effect, those in work or seeking jobs—are derived from population estimates combined with activity rates assessed from recent trends. These estimates suggest some increase, though probably small, between mid-1981 and mid-1982. This compares with an estimated fall of 239,000 in the working population over the same period.

Various factors contribute to this difference. The likely understatement of the number of employees in 420W employment and the use of an unchanged level of self-employment both affect the working population series but do not influence the labour force estimates. Also the working population series was affected by the removal of about 30,000 men aged 60 and over, opting for the longterm rate of supplementary allowance, from the total of unemployed claimants. It is possible that the unemployed included in the labour force—those actively seeking work—may have increased to a somewhat greater extent than the unemployed included in the working population —the monthly count of claimants—though data for past years suggest that any such effect is not likely to be large. A number of other differences in coverage, such as different treatment of participants in special employment schemes, of working students and of people with more than one job may also contribute to differences between changes in the labour force and the working population. However, it probable that the major part of the difference is accounted for by undercounting of employment and self-employment in the provisional working population figures.