Quality report On Labour Cost Survey 2012 Macedonia. Prepared by: Elena Peeska Dejan Peeski

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1 Quality report On Labour Cost Survey 2012 Macedonia Prepared by: Elena Peeska Dejan Peeski December 2014

2 CONTENT 1. Relevance Accuracy Sampling errors Non-sampling errors Coverage errors Measurement and processing errors Non - response errors Model assumption errors Punctuality and timeliness Punctuality Timeliness Accessibility and clarity Comparability Geographical comparability Coherence

3 1. Relevance The data on labour cost are used by policy makers, Government and state organs, social actors, the media, researchers and students and they are one of the basic statistical data indispensable to follow the changes on the labour market. Enterprises are still not so high interested for statistical data for their market research activities or for consultancy services but their interest is in increase. Major foreign user of survey data is Eurostat. 2. Accuracy Sampling frame The frame selection was obtained from all companies active in the Statistical Business Register situation and we getting a set of statistical units Sample The sample design of this survey is made following the regulations described in Council Regulation No.530/1999, but adapted to our conditions and possibilities. Statistical units are enterprises, in the total number of employed are included employees from the units.. According to the Council Regulation the sample is stratified random sample. Stratification is regional, by activities and by the size of the business entities. Stratification: - Stratification by activities is at the level of sectors from B to S NACE Rev.2 (Mining and quarrying (B), Manufacturing (C), Electricity, gas, steam and air conditioning supply (D), Electricity, gas and water supply (E), Construction (F), Wholesale and retail trade, repair of motor vehicles and motorcycles (G), Accommodation and food service activities (I), Transportation and storage (H), Information and communication (J), Financial and insurance activities (K), Real estate activities (L), Professional, scientific and technical activities (M), Administrative and support service activities (N), Public administration and defense, compulsory social security (O), Education (P), Human health and social work activities (Q), Arts, entertainment and recreation (R), and Other service activities (S). Stratification by size of business entities is actually stratification by the number of employees in 6 strata: less than 10 employees, 10-49, , , , 1000 and more employees. In this way 108 (18x6) strata are made. The size of the sample is 4449 units. All business entities from size strata with 250 and more employees are included in the sample. In strata with 1-9 employees and 10-49, employees business entities were chosen randomly. When selecting the sample the percentage representation by regions was respected. 3

4 Table 1: Number of units in the sample by sections of activities NACE (sectors) Number of units Percentage Mining and quarrying Manufacturing Electricity, gas, steam and air conditioning supply Water supply, sewerage, waste management and remediation activities Construction Wholesale and retail trade, repair of motor vehicles and motorcycles Transportation and storage Accommodation and food service activities Information and communication Financial and insurance activities Real estate activities Professional, scientific and technical activities Administrative and support service activities Public administration and defense, compulsory social security Education Human health and social work activities Arts, entertainment and recreation Other service activities Total Table 2: Number of units in the sample by size band of enterprise Number of Percentage business entities Less than and more Total

5 Table 3: Number of units in the frame and in the sample by sections of activities and 4 size classes Sample frame Sample % Activities E1_9 E10_49 E50_249 E250+ E1_9 E10_49 E50_249 E250+ E1_9 E10_49 E50_249 E250+ B C D E F G H I J K L M N O P Q R S Total Sampling errors In the tables 4 to 5 coefficients of variation are shown in percentages for variables D (Annual labour costs) and D/B1 (Hourly labour costs) for different individual breakdowns. The computations of CVs have been produced using the software SAS, PROC SURVEYMEANS procedure. 5

6 Table 4: Coefficients of variations for variable D - Annual labour costs and variable D/B1 - Hourly labour costs by sections of activities CV % Annual labour costs Hourly labour costs Total (B-S) Total B Mining and quarrying C Manufacturing D Electricity, gas, steam and air conditioning supply E Water supply; sewerage, waste management and remediation activities F Construction G Wholesale and retail trade; repair of motor vehicles and motorcycles H Transportation and storage I Accommodation and food service activities J Information and communication K Financial and insurance activities L Real estate activities M Professional, scientific and technical activities N Administrative and support service activities O Public administration and defense; compulsory social security P Education Q Human health and social work activities R Arts, entertainment and recreation S Other service activities Table 5: Coefficients of variations for variable D - Annual labour costs and variable D/B1 - Hourly labour costs by size band of enterprise Gross earnings in the reference month Average gross hourly earnings in the reference month Total Total E1_9 1-9 Employees E10_ Employees E50_ Employees E250_ Employees E500_ Employees E Employees

7 2.2. Non-sampling errors Coverage errors There is no difference between the reference and the study population. Possible over-coverage and under-coverage may happen because of demography of the units: births, deaths, mergers and de-mergers of old units. To avoid this to the possible rate, we used the latest updated version of the sampling frame, the business register of the SSO. Over-coverage rate is not available Measurement and processing errors The questionnaire was made according the EU regulation. The survey was conducted in April An information letter was sent to the business entities previously. The data collection method that was used was self-administrated survey done by sending the questionnaires by post to the enterprises. Data control was done during the survey by the staff in the regional offices, and later by the staff in the subject matter department in SSO. Most of the errors and difficulties in filling in the data were found in the variables for paid but not worked hours and in the variables for labour cost for days not worked. These mistakes were corrected during the data collection or in the post-data-collection processes data entry or editing. Processing errors in post-data-collection processes such as data entry errors were found and corrected Non - response errors Unit response rate: The overall unit response rate was 74.1 %. Response rate by activities and NUTS3 is given in the table 6 and table 7. 7

8 UNIT RESPONSE RATE: Table 6: Unit response rate by sections of activities. Unit response rate Total (B-S) Total 74.1 B Mining and quarrying 73.8 C Manufacturing 81.5 D Electricity, gas, steam and air conditioning supply 76.5 E Water supply; sewerage, waste management and remediation activities 81.1 F Construction 65.3 G Wholesale and retail trade; repair of motor vehicles and motorcycles 60.3 H Transportation and storage 58.4 I Accommodation and food service activities 48.9 J Information and communication 75.0 K Financial and insurance activities 92.0 L Real estate activities 69.2 M Professional, scientific and technical activities 65.4 N Administrative and support service activities 68.9 O Public administration and defense; compulsory social security P Education 99.8 Q Human health and social work activities 89.4 R Arts, entertainment and recreation 92.6 S Other service activities 53.0 Table 7: Unit response rate by NUTS3 Unit response rate Total Total Vardar East South-west South-east Pelagonia Polog North-east Skopje

9 Model assumption errors No models were used. 3. Punctuality and timeliness 3.1. Punctuality The LCS in Macedonia was conducted April A circular letter containing the general information about the survey and obligation by Law of Statistics to fill the questionnaire and the questionnaire was sent by post to the respondent units. The data collection method that was used was self-administrated survey. The respondent units had a period of 15 days ( ) in which they had to fill in and send back the questionnaire. Staff in the regional offices controlled the data and send to SSO by the end of May. In order to collect data from more medium and large enterprises big effort was made reminding the respondent units again to send back the questionnaire. Data processing in SSO was done from July 2013 till April 2014 by the following order: -The data was controlled by the staff from the subject matter department; -Data entry; -Data checking and editing. -Weighting of the data and making tables; -Data analysis of the results. The final results were published on 17 April Timeliness The data were published on 17 April 2014, which is 15 months after the reference period The data were sent to EUROSTAT in June Accessibility and clarity The data were published in April 2014 as final data, including explanations and short methodology and are available for the users on our web site. The publication for this survey is also available. No results are sent to reporting units included in the sample. 9

10 5. Comparability 5.1. Geographical comparability There is no deviation from European concepts. The methodology and the used definitions are according the EU regulations. 6. Coherence The coherence is analyzed according to the template provided by Eurostat. Coherence with the statistics from Labour Force Survey The comparison between the number of hours actually worked in 2012, expressed per employee (from Labour Cost Survey) and the average actual hours worked in the main job per year of the Labour Force Survey (LFS), expressed per employee shows small differences in four NACE Rev.2 sections, average differences in eight NACE Rev.2 sections and large differences in six NACE Rev.2 sections. Apart from the clear difference in terms of employment definitions and survey methodology between LFS and LCS, the main reason for the discrepancies between the figures provided by the two data sources is the informal sector that is covered only by LFS. The sections where the number of hours worked is much higher in LFS than in LCS are F- Construction, B- Mining and quarrying, D- Electricity, gas, steam and air conditioning supply, G- Wholesale and retail trade; repair of motor vehicles and motorcycles etc. Small difference we have in section Q- Human health and social work activities and P- Education. The only sector where the number of hours worked is higher in LCS than in LFS is O- Public administration and defense, compulsory social security. 10

11 Table 8: Hours actually worked per year per employee (LFS: main job) NACE section Data Total diff Diff in % Rev 2 LCS LFS B C D E F G H I J K L M N O P Q R S Total Comparison LFS, LCS: Hours worked LCS LFS B C D E F G H I J K L M N O P Q R S total NACE section 11

12 Coherence with Structural Business Statistics (Monthly survey for wages and employees) The sections where wages and salaries are much higher in LCS than in SBS are: O- Public administration and defense, compulsory social security and H- Transportation and storage. Table 9: Wages and salaries, per employee, same variable in SBS NACE section Data Total diff Diff in % Rev 2 LCS SBS B C D E F G H I J K L M N O P Q R S Total

13 Comparison SBS, LCS: Wages and salaries LCS SBS B C D E F G H I J K L M N O P Q R S total NACE section Coherence with National Accounts The comparisons between the compensation of employees, expressed per employee, show differences between Labour Cost Survey and National Account, especially in sector F- Construction. This is due to the different calculation method that is used in NA for the number of employees, which is significantly higher in NA than in LCS. Table 10: Compensation of employees, per employee: D1 in LCS, D1 National Accounts NACE section Data Total diff Diff in % Rev 2 LCS NA B to E F G to N O to S* Total

14 Comparison NA, LCS: Compensation of employees C to E F G to K L to M* total NACE section LCS NA 14