REPORT ON THE QUALITY IN THE LCS 2004 POLAND

Transcription

1 REPORT ON THE QUALITY IN THE LCS 2004 POLAND Warsaw, (prepared by Jolanta Szutkowska the Main Expert in the Labour Costs and Earnings Section of the Social Statistics Division PCSO) INTRODUCTION The aim of this report is the evaluation of the quality components in the LCS 2004 such as: relevance; accuracy; timeliness and punctuality; accessibility and clarity; comparability; coherence. 1. RELEVANCE Relevance addresses the aspects related to the description of the users, description of their needs and to which extent the users needs are fulfilled. The LCS2004 covers units of national economy (national needs - sections NACE: A-O; for the aim of Eurostat sections NACE: C-O) employing 10 and more employed persons. Beginning from LCS2000 this survey is conducted every 4 years. 1.1 Description of the users Users of the LCS data can be divided on the following groups: a) internal users: - government bodies such as Ministry of Labour and Social Policy, Ministry of Financy, Ministry of Education, Ministry of Industry; - research centres such as Polish Academy of Science, university, high schools; - employers especially employers of: financial intermmediation and real estate sector; - trade unions; - students, pupils; - mass media. 1

2 a) international users - European Union bodies European Council, European Commission, Eurostat; - international bodies such as OECD, Monetary International Fund, International Labour Organization; - foreign employers; - foreign research centres Description of users needs Generally, internal users are interested in the basic measures of labour costs and their impact on the situation on labour market e.g. Ministry of Labour and Social Policy examines the relation between labour costs measures and unemployment; Ministry of Financy examines labour costs in different type of activities; Ministry of Education examines labour demand in relation to the basic measures of labour costs; Research centres are interested in analysis of labour costs in comparison with work efficiency, besides they conduct international comparisons on the level of labour costs in European Union Countries and other countries; Employers conduct economic calculations with applying labour costs measures in order to conduct their adequate employment and investment policy; Students use labour costs data in their master thesis or Ph thesis Satisfaction of the users needs The needs of users are satisfied in professional way. Users obtain all information on labour costs that are indispensable for conducting adequate calculations, analysis or policy. Scientists and journalists need detailed information on labour costs in Poland in comparison with labour costs in European Union Countries and other countries. * * * 2

3 The main conclusions on relevance are presented in the table below: USERS BASIS ON WHICH USERS NEEDS SATISFACTION USERS NEEDS OF THE USERS ARE EXPRESSED NEEDS Ministries Enterprises INTERNAL USERS The needs are expressed on the basis of national law. The needs are expressed on the basis of economic and investment policy of enterprises. Ministries are interested in the basic measures of labour costs and their impact on labour market i. e. Ministry of Labour and Social Policy examines the relation between labour costs and unemployment, Ministry of Education examines labour demand in relation to the basic measures of labour costs, Ministry of Industry examines labour costs in relation to work efficiency. Enterprises are interested in comparision of labour costs data by different type of activity, size of units and ownership sector. Available data on labour costs are sufficient to satisfy users needs. Available data on labour costs are sufficient to satisfy users needs. 3

4 USERS BASIS ON WHICH USERS NEEDS ARE EXPRESSED USERS NEEDS SATISFACTION OF THE USERS NEEDS Employers associations Trade unions Researchers e.g.: - Polish Academy of Science; - University; - Research institutes - students INTERNAL USERS The needs are expressed on the basis of national law and collective agreements. The needs are expressed on the basis of national law and collective agreements. Needs are expressed on the basis of surveys programmes prepared by research centres. Employers associations are interested in trends of labour costs and adaptation of enterprises to changes in labour costs. Trade unions are interested in applying of labour costs data in negotiation of collective agreements. Scientists are interested in conducting labour costs analyses in comparison with: the level of unemployment, the labour demand, work efficiency. They also conduct international comparisons of labour costs in European Union Countries and other countries. Available data are sufficient with regard to labour costs by type of activity, ownership sectors and size of units. Employers are also interested in projections. Forecasts of labour costs are not conducted by the PCSO. Available data are sufficient with regard to labour costs by type of activity, ownership sectors and size of units. Users needs are satisfied in limited range due to limited comparability of data from different sources (differences in methodology). Satisfaction of users needs is expressed in the form of scientific publications. 4

5 USERS BASIS ON WHICH USERS NEEDS ARE EXPRESSED USERS NEEDS SATISFACTION OF THE USERS NEEDS Media INTERNAL USERS Needs depend on current socioeconomic situation in the country. Journalists are interested in different publications on labour market. Users have an access to different statistical publications where labour costs results are presented: Yearbooks, Labour Yearbooks edited every 2 years, publication on labour costs edited every 4 years. Satisfaction of users needs is expressed in the form of press articles and in radio and TV programmes. EUROSTAT OECD ILO INTERNATIONAL USERS Needs are expressed Users are interested on the basis of in requested Commission aggregations of Regulation No variables. 1737/2005 of 21 October 2005 amending Regulation (EC) No 1726/1999 as regards the definition and transmission of information on labour costs. Requested aggregations are constructed to satisfy users needs. When requested aggregations of data are not available, the most similar aggregations are applied. 5

6 USERS BASIS ON WHICH USERS NEEDS ARE EXPRESSED USERS NEEDS SATISFACTION OF THE USERS NEEDS Foreign investment agency INTERNATIONAL USERS Needs depend on economic and investment policy of foreign agency. Foreign investment agencies are interested in labour costs in different type of activity for the purposes of their own investment policy. All requested data are sent by or by post to foreign enterprises. When requested aggregations of data are not available, the most similar aggregations are applied to satisfy users needs. 2. ACCURACY Data obtained from sample surveys such as the survey on labour costs are biased with: sampling and non-sampling errors which determine accuracy of the survey. Thus, limitation and reduction of these errors significantly influences on improvement of data quality and correct interpretation of survey results Sampling errors Sampling errors are related to the sample size and sampling schemes. Their nature consists in the fact that incomplete information concerning a phenomenon influences on lack of confidence regarding relevance of estimates obtained from a sample survey. Thus, results of a sample survey should be treated as only approximate estimation on a value of an unknown parameter of population. Therefore, on one hand we should be aware of incomplete reliability of results (i.e. differences between values gained from a sample and actual values in population, possible to obtain only from a full survey), while on the other hand we should try to obtain maximum credibility of data through adequate sampling. Evaluation on sampling errors in the LCS 2004 is carried out on the basis of the relative standard error. Standard error determines a range of variation of a sample mean estimator around a real mean in population (standard error square is called variance of estimated mean). 6

7 Standard error is a measure of data precision. The lower is standard error the higher is precision and vice versa the higher is standard error the lower is precision. Generally, sampling errors can be limited through extension of sample size or appliance of more effective sampling frames. The sampling scheme is described in details in the publication on LCS 2004 available on the Internet site: see item 7 on Probability sampling Bias The LCS is a difficult and time consuming survey. The most difficulties were connected with the completing variables for NACE divisions: 73, 80, 85, 92 because certain group of persons employing in these type of activity (e.g. researchers, teachers, doctors, artists) has other, specific working conditions regulations than other professional groups. It was necessary to include these derrogations in instructions which were sent to regional statistical offices Variance Sampling errors are only available for the basic measures of labour costs by sections according to NACE rev.1 and ownership sectors. Data on sampling errors by type of activity and ownership sector is presented in Annex 1 of this report. Relative standard errors (table I in Annex1 ) were estimated for the basic indicators of labour costs. * * * The analysis of sampling errors presented in table I in Annex 1 shows that the sampling errors for the basic measures of labour costs for the whole national economy were following: - labour costs per 1 employee %; (monthly average) - labour costs per 1 hour paid %; - labour costs per 1 hour worked %. 7

8 The highest sampling errors by type of activity took place in: financial intermediation ranged from 2.70% for labour costs per 1 employee (monthly average) to 3.42% for labour costs per 1 hour paid; construction ranged from 2.14% for labour costs per 1 hour worked to 2.41% for labour costs per 1 employee (monthly average); trade and repair^ ranged from 2.38% for labour costs per 1 employee (monthly average) to 2.68% for labour costs per 1 hour worked. The smallest sampling errors by type of activity were in: mining and quarrying - ranged from 0.16% for labour costs per 1 hour paid and 0.19% for 1 hour worked; education- ranged from 0.55 % for labour costs per 1 employee (monthly average) to 1.11% for labour costs per 1 hour worked; health and social work - ranged from 0.83 % for labour costs per 1 employee (monthly average) to 0.89% for labour costs per 1 hour paid. Generally, sampling errors for ratios of labour costs were bigger: in private sector than in public sector; in smaller units than in bigger units. * * * Relative standard errors (Annex I) were estimated for the basic items of the result tables. In the populations with the insignificant number of non-responses, for the purpose of accuracy evaluation the method adequate to the stratified sampling was used, in which two units are sampled from a stratum. In other populations surveyed on the sample basis, the large number of non-responses was observed. Accuracy of the results was estimated applying the balanced half-samples method 1. The formulas relevant to the estimation on both: variance of variable X sum, and the quotient of variables X/Y Non- propability sampling No data from registers have been used, except for the setting up of the frame population. 1 Description of this method is included in the publication of C.E. Särndal, B. Swensson, J. Wretman Model Assisted Survey Sampling, Springer Verlag

9 2.2 Non -sampling errors Non-sampling errors, which are the second type of errors in sample surveys, are divided into: frame errors; measurement and processing errors; non-response errors; model assumption errors Frame errors Generally, frame errors are divided into overcoverage and undercoverage errors. Overcoverage errors relate to units present in the frame and which, in fact, do not belong to the target population or to units not existing in practice (e.g. units that have not been contacted at all, units that are in scope but classified in the wrong sampling strata, duplication in the sampling frame). In the LCS 2004 information on dead units and inactive units which are part of over-coverage are following: dead units constituted about 1 % of the selected sample (the ratio of 208 dead units to the selected sample of units); inactive units constituted about 1% of the selected sample (the ratio of 241 inactive units to the selected sample of units). Undercoverage errors refer to units not included in the frame, but which should be (e.g. delays in birth registration, lost registration applications). For these units no information is obtained. As for methods of limitation and reduction of frame errors, errors due to lack of answers from the whole unit are eliminated mainly through updating addresses in a sample frame and methods of results weighting. Errors deriving from lack of answers regarding items are limited through an appliance of statistical imputation methods i.e. we impute mainly data from annual survey on employment, earnings and working time for the same units or units with similar characteristics which were sampled in the LCS. 9

10 * * * Overall sampling rate (including those units exhaustively covered) Response rate (including overcoverage related to dead units and inactive units) Response rate (excluding overcoverage related to dead units and inactive units) Overall final sample size (number of units actually used) Coverage rate 20 % ( the ratio of number of units sampled i.e units to the universe i.e units) 80 % ( the ratio of final number of units actually used i.e units to the selected sample of units) 81% (the ratio of final number of units actually used i.e units to the sample of units deducting inactive units and dead units from the ex-ante sample i.e = units) units ( after deduction of 5770 non-response units from the selected sample of units) 16 % ( the ratio of number of units actually used i.e units to the universe i.e units) Measurement and processing errors Measurement errors are divided into: the survey instrument (questionnaire) errors, the respondent errors, the information system and the mode of data collection errors. As for the survey instrument- questionnaires errors, the questionnaire in the LCS 2004 is designed in such way to eliminate these types of errors because the explanatory notes are placed on the questionnaire below questions to increase their clarity. 10

11 Below are presented variables that were corrected very often due to following reasons: Reasons not clear questions questions that were the most difficult Type of variables according to Polish methodology It refers to: other expenditures of labour costs not mentioned in separated items of the questionnaire. More detailed explanation note will be inserted in the next edition of LCS. It refers to: data for such reporting units as high schools, research institutes, theatres because persons from these units as teachers, artists, scientists have diffrent regulation on working conditions than other occupation groups. Below, there is the list of variables that are the most difficult to complete for mentioned above type of employed persons: hours worked in the normal time; hours worked in overtime; hours not worked due to holidays; direct remuneration payments due to sickness, payments due to holidays. Detailed explanations how should be completed data for these occupation groups are given in briefings and instructions sent to staff of regional statistical offices. The variables that were corrected very seldom refer to: 13-th payments, expenditures on improvement, training and retraining of personnel, expenditures on business trips, obligatory retirement, pension and accident insurance contributions paid by the employer. Generally, the errors regarding to unclear, illegible questions and explanations were reduced by staff of field statistical offices during the data collection period. Staff of statistical offices obtained detailed briefings what should be done in case of errors. In the t 11

12 edition of the LCS 2004 we withdrew e time consuming questions on labour costs components by manual and non-manual posts. As for the respondent errors, these errors are connected with misunderstandings of methodological note and misinterpretation. Respondents sometimes give incomplete answers in case of time consuming questions. These type of errors are eliminated during the control phase in field statistical offices. If errors are caused by averse attitudes of respondents, a survey objective is explained once again, together with respondents role in a survey and clearance of any doubts concerning a survey. As for the errors of information system, these type of errors are connected with wrong figures that are inserted to the computer system from the paper forms. Thanks to technics OCR and arithmetical and logical control these errors are identified very quickly, explained and corrected. Our ariythmetical and logical controls cover following main assumptions in the LCS 2004: number of people employed full-time is bigger than number of people employed part-time converted into full-time equivalents; paid hours is the sum of normal working hours plus overtime working hours plus hours not worked due to holidays plus hours not worked due to down-time plus other hours not worked; normal working hours have to be bigger than overtime working hours; nominal hours should be ranged from 30 to 48 hours per week for 1 employee except persons employing in NACE divisions rev.1: 73, 80, 85 (it refers mainly to researchers, teachers, doctors); nominal working hours should be ranged from 15 to 48 hours per week per 1 employee for persons employing in NACE divisions rev.1: 73, 80, 85 i.e. mainly for researchers, teachers, doctors; average monthly gross earnings for the year should be ranged from 659 PLN to PLN in the LCS The lowest limit of this bracket is established on the basis of the level of minimum wages which are determined by Ministry of Labour according to national regulation. As for the mode of data collection errors, the method of data collection in the LCS 2004 were based on paper forms that were sent and returned by the post. All doubts regarding variables and addresses of reporting units were explained and updated during phone calls of respondents with the staff of field statistical offices and during the contact. As for errors deriving from data compiling and processing, there are not problem with coding, keying, editing, weighting, tabulating because wrong controlling assumption in a computer program or wrong interpretation of the results were removed immediately during the phase control and data were tested again. In addition in the LCS 2004 the OCR technique ( i.e. optical data reading) was applied. The possibility to scan questionnaires significantly speeded the data processing phase. 12

13 2.2.3 Non- response errors As for non-response errors, errors due to missing answers of sampled units for the LCS 2004 amounted to 20%, of which due to refusals 13%. More detailed classification of non-response units is following: non- response units consists of 5770 units i.e. 20 % of the selected sample by reasons given below: refusals i.e. 13 % of the selected sample; over-coverage of which: i.e. 7 % of the selected sample - dead units i.e. 1 % of the selected sample i.e.28974; - inactive units i.e. 1% of the selected sample; - others (lack of contact) i.e. 5% of the selected sample. Non- response errors by NACE rev.1 are presented below. Specification Non-response by reasons and by of activity NACE rev.1 Nonresponse total 13 Out of reasons Overcoverage Total Dead units Inactive units Other reasons (lack of contact) Refusals in % Total Section A Section B Section C Section D Section E Section F Section G Section H Section I Section J Section K Section L Section M

14 Section N Section O The biggest overcoverage was noted in sections NACE: H 13%, I 11%, G 10%, F- 10%. The smallest overcoverage was registered in sections NACE: L 1%, E 2%, M 3%, N 4%. The biggest refusal rate was observed in sections NACE: H 26%, F 20%, G- 19%. The smallest refusal rate was noted in sections NACE:E - 3%, L 3%, M 8%. Non response errors due to missing items are marginal and they are eliminated by imputing data for the same variables of the same units from similar surveys on employment and earnings. Non-response which refer to the whole unit is taken into consideration during the creation of the generalizing ratios (for more details see the description in item 2.2.4) Model assumption errors As for assumption errors, seasonal adjustments are not applied in the LCS There are not errors connected with benchmarking procedures (preliminary data before grossing up are available six months after the reference year - in June, final data after grossing up are available seven months after the reference year in July). The assumptions regarding the grossing up procedure are following. The basic parameter estimated in the labour costs survey 2004 is a sum of values of the surveyed variable X. The parameter is estimated by the following formula: (1) =, x ˆ where: i M ki xki M ki weight assigned to the i-th unit in the k-th population, X ki value of variable X in the i-th unit of the k-th population. Generalization of the results according to the formula (1) would be correct if the survey was complete in each of the surveyed populations. In the labour costs survey 2004 non-responses were observed. They were mainly due to refusals and the so-called lack of contact with the sampled units. Therefore, in 65 populations where significant number of non-responses was observed, weights Mki were adjusted with the use of information concerning the number of the employed persons recorded in the sample frame for the surveyed units, as well as those that were not surveyed for various reasons. The corrections were made separately in 6 classes of unit size according to the number of the employed persons recorded in the sample frame. The following classes were determined: up to 19 14

15 employed persons, 20 49, 50 99, , and 500 and more employed persons. In the k-th population weights were corrected according to the formula: P P P + + 1kj 2kj 3kj (2) =, W while: u kj M (3) =, + where: P P 2kj ki 2kj P 4kj 1kj u P P1kj the number of the employed persons in the surveyed units in the j-th class of the k-th population, P 2kj the number of the employed persons in the units that were not surveyed due to refusals in the j-th class of the k-th population, P3kj the number of the employed persons in the units that were not surveyed due to lack of contact in the j-th class of the k-th population, P4kj the number of the employed persons in the units that were not surveyed due to lack of activity, liquidation or bankruptcy of the unit in the j-th class of the k-th population. The formulas (2) (3) indicate that weights correction covered non-responses caused by refusals and in proportion to the number of refusals those that were due to lack of contact with a sampled unit. Values of the variable X for the k-th population estimated with the appliance of weights Mk or Wkj, were then aggregated, according to the needs, into NACE divisions and sections, ownership sectors and for the whole national economy. Moreover, quotients of variables X/Y e.g. labour costs per one employee were also estimated on different aggregation levels. The next assumptions regarding labour costs survey are as follows: Labour costs survey cover calendar year figures. Where is necessary we ask the reporting units to supply calendar year estimates. Small enterprises, in this case enterprises with less than 10 employees, have not been accounted for. No combinations between survey data and data from administrative source have been done. That is, all data come from the survey results. 15

16 3. TIMELINESS AND PUNCTUALITY Timeliness and punctuality refer mainly to pre-established and factual reference periods of data and publication dates. As for compiling the questionnaire date in the LCS 2004: Questionnaire was compiled in November 2004; As for drawing the sample dates for the LCS 2004: Sample was prepared in February 2005; As for preparing methodological briefings and tabulations for statistical regional offices: Methodological notes and tabulations were prepared in March 2005; As for data- collection dates: Data were collected from half of March to half of April 2005; As for key dates for the post-collection phase: data were checked and processed in the field statistical offices in May 2005; preliminary data before the grossing procedure were available in June 2005; final data after the grossing procedure were available in July 2005; As for key publication dates publication on labour costs in Polish-English version was available in November2005- see item 7 available on ( in the publication was put the chapter on data quality of labour costs survey according to requirements of European Statistical System) As for punctuality data on the LCS 2004 were transmitted to Eurostat in April 2006 according to Comission Regulation 1735/ ACCESSIBILITY AND CLARITY Accessibility and clarity refer to how accessible the statistics on labour costs is. Data are available in the form of the users desire e.g. graphs, tables, methodological description, main characteristics of basic indicators. Data are well documented in the form of: 16

17 - publications the recent LCS publication (Polish-English version) consists of 290 pages, it covers methodological note, characteristics of basic measures of labour costs, information on sampling method and data quality, tables, graphs; the LCS publications are disseminated every 4 years; - information service of Data Dissemination Division the Data Dissemination Division distributes data on labour costs for internal and external users; - chapters on LCS in Yearbooks, Labour Yearbooks published every 2 years. 5. COMPARABILITY The comparability component refers to spatial comparability and comparability over time Spatial comparability There are not differences in the definition of statistical units. The definition of statistical units is based on the Council Regulation No 530/1999 and the Commission Regulation No 1726/1999 and the updated Commission Regulation No 1735/2005. There are not differences in the reference population. The LCS 2004 covers units employing 10 and more employed persons from the type of activity A O according to NACE rev.1 of which C O NACE rev.1 for the aim of data transmission to Eurostat. There are not differences in applied classifications. In the LCS 2004 following classifications are applied: - the economic activities in terms of NACE rev.1; - type of territorial units by NUTS ; - size of units: 10-49, , , , There are not differences in applied definitions of variables Expenditures on business trips included in Polish components of labour costs were excluded in data on labour costs transmitted to Eurostat because they are treated by Eurostat as the intermediate expenditures Comparability over time As for the comparability over time, beginning from 1996 Poland conducts LCS every 4 years. In periods between the sample surveys are conducted assessments of basic ratios of 17

18 labour costs. Thanks to such solution we are able to conduct comparability over time with regard to LCS results. Besides, it is worth to stress that definitions of statistical units, reference population and variables are based on Eurostat recommendation and that is why the results of the LCS are comparable on international scale. We try to implement changes imposed by Eurostat legislation to satisfy users in effective way. During the period we changed the coverage of units namely the LC data for year covered units with more than 5 employed persons and the LCS 2000 and the LCS 2004 cover units with more than 9 employed persons. We also had changes in distribution of social security contributions, namely up to 1998 all social security contributions were paid by employers, beginning from 1999 social security contributions have been paid partly by employers and employees. These changes have not significant impact on basic ratios of labour costs in the periods They have only impact on labour costs structure with regard to relationship between direct costs and social security contributions because on the one hand social security contributions paid by employees are included in direct costs but on the other hand social security contributions paid by employers are included in indirect costs. 6. COHERENCE Coherence refers to comparability of data from different domains and sources. In our case LCS data are compared with: LFS, Structural Business Statistics, National Accounts Statistics, Labour Costs Index. a) THE LCS COHERENCE WITH THE LABOUR FORCE SURVEY The following table summarises the comparison of both sources. Specification Labour Costs Survey (LCS) Labour Force Survey (LFS) Series Annual data Quarterly data Statistical unit Enterprises / Local units Household Activity coverage NACE Rev.1 Sections A O NACE Rev.1 Sections A O Variables to be compared as between the two sources Required activity breakdown Required regional breakdown Average employment ( according to place of work) Hours worked in the reference year Gross wages and salaries Average employment (according to place of living) Hours worked in the week of the reference quarter Gross wages and salaries NACE Rev.1 at the Section level NACE Rev.1 at the Section level NUTS, level 1, level 2 NUTS, level 1, level 2 18

19 Comparison of hours worked in thous. in 2004 from LFS and LCS Selected sections of NACE Labour costs survey Labour Force Survey Section D Section F Section G Section I Section M Section N Remark: Data on hours worked taken from the LFS are assessed according to following formula: hours worked per week in given section * 52 weeks per year * hired employees in given section Comparison of hours worked per 1 employee in 2004 from LFS and LCS Selected sections of NACE Labour costs survey Labour Force Survey Section D Section F Section G Section I Section M Section N Remark: Data on hours worked per 1 employee from the LFS are based on assessments. 19

20 The LCS and the LFS don t correspond well because of diffrent method of data collection and differences in methodology. b) THE LCS COHERENCE WITH STRUCTURAL BUSINESS STATISTICS The following tables summarise the comparison of both sources. Specification Labour Costs Survey (LCS) Structural Business Survey (SBS) (Annual regional statistics) Series Annual data Annual statistics Statistical unit Enterprises /Local units Enterprises /Local units Activity coverage NACE Rev.1 Sections A O NACE Rev.1 only selected Sections: B,C,D,E,F,G,H,I,K. Variables to be compared as between the two sources Required activity breakdown Required regional breakdown Specification Average employment excludes persons working abroad and persons involved in public works financed from the Labour Fund Gross wages and salaries Number of units in the sample NACE Rev.1 at the Section and Division level Average employment includes persons working abroad and persons involved in public works financed from the Labour Fund Gross wages and salaries Number of units in the sample NACE Rev.1 at the selected Section and Division level NUTS, level 1 NUTS, level 1 Labour Costs Survey (LCS) Series Table B: national data statistics by size class of enterprise Structural Business Survey (SBS) (Annual enterprise statistics by size class) Annual enterprise statistics by size class Statistical unit Enterprises /Local units Enterprises /Local units 20

21 Activity coverage NACE Rev.1 Sections A O NACE Rev.1 only selected Sections: B,C,D,E,F,G,H,I,K. Variables to be compared as between the two sources Average employment excludes persons working abroad and persons involved in public works financed from the Labour Fund Gross wages and salaries Number of units in the sample Average employment includes persons working abroad and persons involved in public works financed from the Labour Fund Gross wages and salaries Number of units in the sample Required activity breakdown Size class breakdown NACE Rev.1 at the Section and Division level Number of employees:10-49, , , and employees NACE Rev.1 at the selected Section and Division level Number of employees:10-49, 50-49, , and employees These sources correspond well. Hence, the average employment and wages and salaries are nearly equal. The comparison of average employment (in persons) from the LCS and the SBS in 2004 is presented below: Selected type of activities according to NACE rev.1 Labour Costs Survey (LCS) Structural Business Survey (SBS) Mining and quarrying (C) Manufacturing (D) Electricity, gas and water supply (E) Construction (F) Trade and repair ^ (G) Hotels and restaurants (H) Transport, storage and communication (I) Real estate and business activities (K)

22 The comparison of wages and salaries (in million PLN ) from the LCS and the SBS in 2004 is presented below: Selected type of activities according to NACE rev.1 Labour Costs Survey (LCS) Structural Business Survey (SBS) Mining and quarrying (C) Manufacturing (D) Electricity, gas and water supply (E) Construction (F) Trade and repair ^ (G) Hotels and restaurants (H) Transport, storage and communication (I) Real estate and business activities (K) The comparison of average wages and salaries (in PLN ) from the LCS and the SBS in 2004 is presented below: Selected type of activities according to NACE rev.1 Labour Costs Survey (LCS) Structural Business Survey (SBS) Mining and quarrying (C) Manufacturing (D) Electricity, gas and water supply (E) Construction (F) Trade and repair ^ (G) Hotels and restaurants (H) Transport, storage and communication (I) Real estate and business activities (K) The graphic illustrations of above comparisions are placed in Annex 2. 22

23 c) THE LCS COHERENCE WITH NATIONAL ACCOUNTS The following table summarises the comparison of both sources. Specification Labour Costs Survey (LCS) National Accounts Series Annual data Annual data Activity coverage NACE Rev.1 Sections A O in NACE Rev.1 Sections units employing more than 9 persons A O regardless of the number of employed persons Variables to be compared as between the two sources Average employment Hours worked in the reference year Gross wages and salaries Labour costs include: payments from profit and balance surplus in cooperatives, expenditures on business trips (for the national aims), expenditures on improving work safety. Labour costs don t include funded scholarships, parlamentary allowances Average employment Hours worked in the reference year Gross wages and salaries Labour costs don t include: payments from profit and balance surplus in cooperatives, expenditures on business trips, expenditures on improving work safety. Labour costs include funded scholarships, parlamentary allowances. Required activity breakdown NACE Rev.1 at the Section and Division level NACE Rev.1 at the Section and Division level These sources don t correspond well because employment costs from the NA are higher than from the LCS. These reasons for differences are connected with: differences in definitions The NA cover all employment costs connected with employment of persons on the basis on different engagements ( labour contract, callup, appointment or election). The LCS covers only employment costs connected with employment of persons on the basis on labour contract.. The most important is that the NA cover employment costs in the hidden economy which are not included in the LCS. The hidden economy has the significant impact on the level of labour costs mainly in such sections as D, F,G,K. differences in LC components The NA components of employment costs cover non- personal pays (pays based on the order agreements) for persons who perform tasks for units but they are not employed in units, commission wages and salaries, sick 23

24 pays regardless the length of illnesses, parlamentary allowances, funded scholarships. The LCS components don t cover mentioned above components that are counted to the NA (sick pays are included in the LCS but up to 35 days). the NA include employment costs of agents, outworkers, people who are not employees of units but they perform tasks for these units on the basis of order agreements. These type of persons are not included in the LCS. The comparison of labour costs (in million PLN ) from the LCS and the National Accounts in 2004 is presented below: Selected type of activities Labour Costs Survey National Accounts according to NACE rev.1 (LCS) Industry (C+D+E) Mining and quarrying (C) Manufacturing (D) Electricity, gas and water supply (E) Construction (F) Trade and repair ^ (G) Hotels and restaurants (H) Transport, storage and communication (I) Real estate and business activities (K) The graphic illustration of this comparison is included in Annex 2. d) THE LCS COHERENCE WITH LABOUR COSTS INDEX Information on data coherence between LCS and LCI in more details are given in the Quality Report on LCI. For the aim of this quality report the coherence will be considered as the relation between the average annual growth rates of hourly labour costs from LCS 2004 and the average annual growth rate of LCI. Hourly labour costs from LCS for the total C_K as the dynamics rate from 2004 with reference to 2000 amounts to +19,42%. Hourly labour costs from LCI for total C_K as the dynamics rate from 2004 with reference to 2000 amounts to +23,50 %. Differences in dynamics rates between these sources are based on following reasons: a) LCI is based on assessments from different statistical sources on labour costs, earnings and working hours, LCS is the representative, sample survey conducted every 4 years; 24

25 b) differences in labour costs from LCS and LCI are caused by recruitment costs, costs on working safety and canteen costs which are included in the LCS and they are excluded in the LCI. CONCLUSIONS In the current edition of LCS 2004 all necessary improvements in comparison with the previous survey the LCS 2000 were introduced to improve the completness and quality of data (including of apprentices, implementation of divison of working hours by full-time, part-time and apprentices). The minor differences in the context of labour costs are caused by including of expenditutres on business trips in Polish survey on LCS and excluding of this component from labour costs for the aim of Eurostat. Moreover, some obligatory variables such as D1112 payments to employees savings schemes, D1114 wages and salaries in kind, D4 - taxes, D5- subsidies received by the employer are marked as NA because they didn t registered by respondents. This report presents only general information on the data quality. More detailed information on sampling errors for: average monthly labour costs per 1 employee, labour costs per 1 hour paid, labour costs per 1 hour worked by type of activity according to NACE rev.1 are presented in Annex 1 of this report. The graphic illustrations of coherence between the LCS, the SBS and National Accounts are included in Annex 2 of this report. 25

26 SDDS - LABOUR COSTS SURVEY SUMMARY METHODOLOGY Country: Poland Series: Labour costs I. Analytical framework, concepts, definition and classifications Concepts and Definitions Labour costs are defined as the costs borne by the employer on acquiring, using, maintaing and upgrading labour resources. They include: compensation of employees (D1), vocational training costs (D2) and other expenditure paid by the employer (D3). Taxes (D4) and subsidies (D5) received by the employer are not recognized. Three basic indicators are calculated on labour costs: average monthly labour costs per 1 employee; labour costs per 1 hour worked; labour costs per 1 hour paid. Classifications The classification used for the type of economic activity is NACE Rev.1. Data are coded at the 2-digit level of the Statistical Classification of Economic Activities of the European Communities ( divisions for sections C-O including section L of NACE Rev. 1). International standards Definitions are in accordance with the international standards of European Labour Costs according to European Commission Regulation No 1737/2005 amending Regulation (EC) No 1726/1999 as regards the definition and transmission of information on labour costs. 1

27 II. Scope of the data Industrial coverage The survey covers local economic units in the country - enterprises, companies, organizations, etc. All type of economic activities from sections C-O (NACE Rev.1) are covered at the level of division of NACE Rev.1. Sections of NACE Rev.1 are used as follows: C - mining and quarrying; D - manufacturing; E - electricity, gas and water supply; F - construction; G - trade and repair; H - hotels and restaurants; I - transport, storage and communication; J - financial intermediation; K real estate, renting and business activities; L - public administration and defence; M education; N health and social work; O other community, social and personal service activities. Remark: Polish Labour Costs Survey covers also sections A and B of NACE Rev.1 but data from these sections are not transmitted to Eurostat. Geographic coverage The LCS survey covers the entire geographic territory of Poland. Occupational coverage All occupations are covered. Enterprise coverage Data from LCS2000 and LCS2004, that results are transmitted to Eurostat, cover units employing more than 9 persons from sections C O by NACE rev.1 (including public and private sectors) 2

28 Population coverage The statistical unit is the local unit. The survey collects data for all employees (full-time, part-time, manual, non-manual) working under labour contract in the surveyed units excluding persons employed abroad, on maternity leave, rehabilitation leave, agents, homeworkers. Topical coverage Topical areas include: number of employees, hours worked, hours paid, compensation of employees, vocational training costs, other expenditure paid by the employer. Taxes and subsidies received by the employer are not recognized. There are three essential indicators which are calculated: average monthly labour costs per 1 employee, labour costs per 1 hour worked, labour costs per 1 hour paid. III. Accounting Conventions Reference period and Frequency Timeliness Annual data are collected every 4 years. Data are delivered to Eurostat according to deadline given by the adequate European Commission Regulation i.e. within 180 days after the reference period. IV. Nature of Basic Data Data comes from the representative labour costs survey conducted every 4 years according to requirements established by Eurostat. Sampling features (sample size and design) The size of sample amounts to more or less 20% of the random frame. The random sampling is applied (the scheme of stratified and proportional sampling). For LCS2004 the random frame amounted to above 140 thous. units. The sample amounted to above 28 thous. units. As the final effect, compilance of labour costs survey 2004 results was based on 80% of preliminar sample (response rate). 3

29 Data collection Data are collected by using paper forms filled by the observed units and sent to regional statistical offices by post. The observed units are taken from the Business Statistical Register. V. Compilation Practices Estimation methods Labour costs indicators are calculated in a following way: 1. Average monthly labour costs per 1 employee Labour costs / (number of employees x 12) 2. Labour costs per 1 hour worked Labour costs/ hours worked 3. Labour costs per 1 hour paid Labour costs/ hours paid Remark: Labour costs indicators presented in Polish publications include expenditures on business trips. This component is not included in data on labour costs transmitted to Eurostat because it is treated by Eurostat as intermediate expenditures not covered by components D1, D2 or D3. Input processing: Collection, recording, checking and processing of input data is undertaken by the staff of regional statistical office conducting LCS survey. If errors in data quality are discovered, the reporting units are contacted to complete or correct information. Verification of extreme values Extreme values which are outside the expected intervals are verified during logical and arithmentic control in regional statistical offices. 4

30 Treatment of missing data Missing data mainly on wages and salaries are replaced with information provided by the others reporting units which responded for the same period and for the same type of activity and for similar size ( imputation). Non-responding sample units are included in surveys by weighting procedures in the corresponding stratum. VI. Other Aspects Seasonal adjustment LCS data are not seasonally adjusted. History of the survey For the first time LCS was conducted for the whole national economy for Beginning from this period LCS are conducted every 4 years according to adequate European Commission Regulations. Data for LCS2000 and LCS2004 were transmitted to Eurostat according to required technical format. In periods between labour costs surveys annual assessments on labour costs are conducted. Contact person: Jolanta Szutkowska Main Expert of Labour Costs and Earnings Section Central Statistical Office of Poland Niepodleglosci Warsaw Tel: (+4822) Fax: (+4822) J.Szutkowska@stat.gov.pl 5

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33 ANNEX 1 TABL.I. ESTIMATES ON RELATIVE STANDARD ERRORS OF ESTIMATORS FOR SELECTED OUTCOME POSITIONS OF THE LABOUR COSTS SURVEY 2004 SPECIFICATION LABOUR COSTS LABOUR COSTS PER TOTAL 1 employee 1 hour (monthly paid worked average) in % Total by ownership sectors Public sector Private sector by size of units and more by type of activity Agriculture, hunting and forestry Fishing Industry Minning and quarrying Manufacturing Electricity; gas and water supply Construction Trade and repair^ Hotels and restaurants Transport, storage and communication Financial intermediation Retail estate, renting and business activities Public administration and defence; compulsory social security Education Health and social work Other community; social and personal service activities

34 Data for 2004 AVERAGE EMPLOYMENT FROM THE LCS AND THE SBS The LCS The SBS Mining and quarrying (C) Manufacturing (D) Electricity, gas and water supply (E) Construction (F) Trade and repair ^ (G) Hotels and restaurants (H) Transport, storage and communication (I) Real estate and business activities (K) Remark- excluding apprentices WAGES AND SALARIES FROM THE LCS AND THE SBS IN MILLIONS The LCS The SBS Mining and quarrying (C) Manufacturing (D) Electricity, gas and water supply (E) Construction (F) Trade and repair ^ (G) Hotels and restaurants (H) Transport, storage and communication (I) Real estate and business activities (K) Remark- excluding apprentices LABOUR COSTS FROM THE LCS AND NATIONAL ACCOUNTS IN MILLIONS The LCS The NA Industry (C+D+E) Mining and quarrying (C) Manufacturing (D) Electricity, gas and water supply (E) Construction (F) Trade and repair ^ (G) Hotels and restaurants (H) Transport, storage and communication (I) Real estate and business activities (K) Remark: LCS excluding apprentices

35 AVERAGE WAGES AND SALARIES FROM THE LCS AND THE SBS IN PLN The LCS The SBS Mining and quarrying (C) Manufacturing (D) Electricity, gas and water supply (E) Construction (F) Trade and repair ^ (G) Hotels and restaurants (H) Transport, storage and communication (I) Real estate and business activities (K) Remark- excluding apprentices HOURS WORKED PER 1 EMPLOYEE IN 2004 FROM LFS AND LCS The LCS The LFS Manufacturing (D) Construction (F) Trade and repair ^ (G) Transport, storage and communication (I) Education (M) Health and social care (N) Remark- excluding apprentices