Measuring employment and unemployment in the Jamaica Labour Force Survey
WHAT IS THE LABOUR FORCE SURVEY?
The Labour Force Survey (LFS) is a household-based survey conducted by the Statistical Institute of Jamaica (STATIN) on a quarterly basis in January, April, July and October each year since 1968. The survey is designed to monitor changes in the employment situation in Jamaica, primarily on the basis of data obtained from the survey. A representative sample of dwellings is visited each quarter by trained interviewers using structured questionnaires to conduct face-to-face interviews.
The survey targets the non-institutional population 14 years and over. Excluded from the survey are persons living in institutions such as hostels, army barracks, places of safety and other institutions.
WHAT IS THE SOURCE OF THE STANDARDS AND GUIDELINES USED IN THE LFS?
All the standards, concepts, definitions and guidelines used in the Labour Force Survey conform to the recommendations of the International Labour Organisation (ILO). This allows for international comparability of the labour market indicators produced by STATIN.
HOW IS THE INFORMATION FROM THE LFS USED?
Information from the Labour Force Survey is used by government institutions, trade unions, labour market analysts, economists, consultants and planners for the evaluation and planning of employment programmes.
The survey is used to produce the well-known unemployment rate as well as other standard labour market indicators such as the employment rate and the labour force participation rate. It also provides employment estimates by industry group, occupation, hours worked, and much more.
The survey defines the working-age population as persons 14 years and older.
The minimum age limit used to measure the economically active population (i.e., the labour, force) varies among countries. In some countries, the minimum age limit starts as low as age six (Egypt), and for others, as high as age 16 (United States). The majority of countries, however, use age 14 or 15 years as the minimum age limit (ILO, 1986).
Since the inception of the Labour Force Survey in Jamaica, the age of 14 years has been used as the minimum age limit to measure the economically active population in Jamaica. This ensures that persons as young as 14 years who are engaged in any economic activity such as working on family farms, and in family or small-scale enterprises with or without pay may be included in the survey.
HOW IS THE LABOUR FORCE DEFINED?
In the labour-force framework, the population is divided into two major groups: the economically active and the economically inactive. A person is classified into one of three categories on the basis of their activities: the employed, the unemployed, and the economically inactive (i.e., outside the labour force). The economically active population or the labour force is further divided into the employed and the unemployed. The employed and the unemployed persons aged 14 years and over together constitute the country’s labour force and includes the following: 1. All persons who were employed in any form of economic activity for one hour or more during the survey week. 2. All persons who had jobs but were absent from work during the reference period; 3. All persons who, although they had no job, or worked less than one hour during the survey week, were looking for work; 4. All persons who although not looking for work, wanted work and were in a position to accept work during the survey week.
WHAT IS THE LABOUR FORCE PARTICIPATION RATE?
The labour-force participation rate is a measure of the proportion of the working-age population that actively engages in the labour market, either by working or looking for work. It provides an indication of the size of the supply of labour available to engage in the production of goods and services, relative to the working age population.
The labour force participation rate is defined as the ratio of the total labour force to the working age population and is expressed as a percentage. The formula used in its computation is shown above.
WHO ARE THE EMPLOYED?
Individuals are defined as being employed if they are 14 years and over and engaged in some economic activity for at least one hour in the week before the start of the survey (reference period). The employed are classified in the following categories: 1. Paid employment – Comprising persons who, during the reference period, performed some form of work for wage or salary in cash or kind. 2. Paid self-employment – Persons with an enterprise, which may be a business enterprise, a farm or a service undertaking who, during the reference period, performed some work for profit or family gain, in cash or in kind. 3. Unpaid workers – Persons who, during the reference period, worked without pay in an economic enterprise operated by a related person regardless of the number of hours worked
WHY USE THE ONE-HOUR CRITERION TO DEFINE EMPLOYMENT?
The one-hour criterion is an internationally agreed standard used in the measurement of employment. It allows for the inclusion of persons who were employed in all types of employment. This includes short-term work, Selected Indicators casual labour, standby work and other types of irregular employment. The use of the one-hour criterion is important for a complete coverage of even the smallest input of labour.
WHO ARE THE UNEMPLOYED?
Individuals are defined as unemployed if they are 14 years and over and during the reference period satisfy the following three conditions simultaneously: 1. ‘Without work’, i.e., were not in paid employment or self-employment. 2. ‘Currently available for work’, i.e., were available for paid employment or self-employment during the reference period; and 3. ‘Seeking work’, i.e., had taken specific steps in a specified recent period to seek paid employment or self-employment. Unemployed is measured in two ways, using the ‘strict’ and the ‘relaxed’ definition.
Unemployment Rate (Both sexes) Male Female Youth (14-24 years) Unemployment Rate (Both sexes) Male Female Labour Force Participation Rate (Both Sexes) Male Female Population (14 years and over) ‘outside the labour force’ Male Female
For the ‘strict’ definition, all three conditions of ‘without work’, ‘available for work’ and ‘seeking work’ must be met simultaneously before a person can be considered to be unemployed. For the ‘relaxed’ definition, however, a person is defined as unemployed if he/she is ‘without work’ is ‘currently available for work’, but have not taken any step to seek work.
In Jamaica, the ‘relaxed’ definition of unemployment is used given that conventional means of seeking work is of minor relevance to the Jamaican labour market. The Jamaican labour market is less organised and a large percentage of the labour force is self-employed.
WHAT IS THE UNEMPLOYMENT RATE AND HOW IS IT CALCULATED?
The unemployment rate is widely regarded as one of the key labour market indicators and a good measure of current economic activity. It is defined as the percentage of the unemployed to the total labour force (sum of the employed and unemployed) and is calculated as shown in the formula above.
WHO ARE CLASSIFIED AS ‘OUTSIDE THE LABOUR FORCE’ OR THE ECONOMICALLY INACTIVE?
The labour force is defined as the sum of the employed and the unemployed. Therefore, all
persons 14 years and older who were not classified as employed or unemployed are considered to be ‘outside the labour force’ or economically inactive. There is a variety of reasons why some individuals do not participate in the labour force, such as they may be engaged in caring for family members, they may be retired, they may be sick or disabled or attending school. Additionally, some may simply be uninterested in working.
WHY DO WE SET A MINIMUM AGE LIMIT OF 14 YEARS FOR THE WORKING-AGE POPULATION?