Concepts and Definitions
Economic activity rate: The number of people who are in employment or unemployed expressed as a percentage of the relevant population.
Economic inactivity rate: The number of economically inactive people expressed as a percentage of the relevant population.
Economically active: The economically active population are those who are either in employment or unemployed.
Economically inactive: Economically inactive people are not in employment, but do not satisfy all the criteria for unemployment. This group is comprised of those who want a job but who have not been seeking work in the last 4 weeks, those who want a job and are seeking work but not available to start and those who do not want a job. For example, students not working or seeking work and those in retirement are classed as economically inactive. It can be useful for some purposes to consider only those who are both economically inactive and not of state pension age.
Employees: The division between employees and self-employed is based on survey respondents' own assessment of their employment status.
Employment: There are two main ways of looking at employment: the number of people with jobs or the number of jobs. These two concepts represent different things as one person can have more than one job. People aged 16 or over are classed as in employment (as an employee or self-employed) by the LFS, if they have done at least one hour of paid work in the week prior to their LFS interview or if they have a job that they are temporarily away from. People who do unpaid work in a family business and people on Government-supported training and employment programs are also included according to the International Labour Organisation (ILO) convention.
Employment rate: The number of people in employment expressed as a percentage of the relevant population.
Model Based Unemployment: In 2003, ONS developed a statistical model to improve small area estimates of unemployment by using supplementary information from the claimant count - a count of the number of people claiming Jobseeker's Allowance. As it is an administrative measure, accurate information is known for all areas. It is also highly correlated with unemployment. The model is said to borrow strength from the claimant count. The model also includes a socio-economic indicator and a random area effect.
More information about the modelling methodology can be found on the ONS website - Model-Based Estimates of ILO Unemployment Guidance.
Rates: Rates represent the proportion of the population or subgroup of the population with a certain characteristic. They allow changes in the labour market to be interpreted in a wider context, allowing for changes in the overall population or the number of people who are economically active. Rates can be calculated for different age groups. For employment, economic activity and economic inactivity, the most widely quoted rates are those for the working age population. For unemployment, headline rates are expressed as a percentage of the economically active population aged 16 and over. Those over retirement age who continue to be economically active will therefore be included in the base while those who are economically inactive will not.
Self-employment: The division between employees and self-employed is based on survey respondents' own assessment of their employment status.
Unemployment: The ILO definition of unemployment covers people who are: not in employment, want a job, have actively sought work in the previous 4 weeks and are available to start work within the next fortnight, or, out of work and have accepted a job which they are waiting to start in the next fortnight.
Unemployment rate: The number of unemployed people expressed as a percentage of the relevant economically active population.
Working age: Note that due to changes in the state pension age (specifically the current female state pension age which is changing dynamically to match the male state pension age), ONS no longer publish rates using a Working age definition in its statistical bulletins, but instead reports rates for all people aged 16 to 64.
16 to 24 year olds Not in Employment, Education or Training (NEET): The proportion of 16-24 year olds who are not classed as a student, not in employment nor participating in a government training programme. Note that the methodology for calculating the levels and proportions of those who are NEET has been further modified this year to better align with the ONS methodology. This should give more accurate estimates of the level of NEETs.
Sex: Sex is self-reported by respondents participating in the Annual Population Survey. No documentation is asked for by the interviewer or provided by the respondent. Hence, analysis is based on 'sex' rather than 'gender'.
Disability: From 2014, the definition of disability is based on the 2010 Equality Act definition. This harmonised definition is based on self-reported health conditions which have lasted 12 months or more which limit ability to carry out day-to day activities a little or a lot. The 2010 Equality Act superseded the Disability Discrimination Act (DDA) 1995, for GB but not for NI, which is the basis of the published APS estimates prior to 2013.
Ethnicity: 'Minority ethnic' includes all categories outside of the white population. 'White' includes 'White-Polish' and 'White Gypsy' who also suffer disadvantage.
Further information on Classifications and Standards is also available from the ONS website at: https://www.ons.gov.uk/methodology/classificationsandstandards
Public Sector is based on survey respondents' own assessment of their sector of employment.
Note: The official source of employment in the public sector at National and Regional level is the Quarterly Public Sector Employment series (QPSE). QPSE data is based on administrative data from the various government organisations and bodies that make up the public sector and is based on the National Accounts definition of the public sector.
Industry: Industry classification is also based on survey respondents' own assessment of their industry of employment. Information from the Quarterly Workforce Jobs (QWFJ) series or the Business Register Employment Survey (BRES) are the preferred sources for estimates of the numbers in employment or employees by Industry. However, the Annual Population Survey provides further characteristic breakdowns for those in employment in different industry sectors than is available from QWFJ or BRES. Information by Industry Sector is based on Standard Industrial Classification 2007.
BRES can be found at: www.nomisweb.co.uk
Occupation: Occupation classification is also based on self-reporting by respondents to the survey. Standard Occupational Classification 2010 is used (SOC2010).
Occupations are classed as high, medium and low skilled using SOC2010 as follows:
- High Skills: Managers, directors and senior officials (SOC 111 to 119), Professional Occupations (SOC 2).
- Medium-High Skills: Other managers and Professional (SOC 12), Associate Professional and Technical Occupations (SOC 3), Skilled Trade Occupations (SOC 5).
- Medium-Low Skills: Administrative and Secretarial Occupations (SOC 4), Caring, Leisure and Other Service Occupations (SOC 6), Sales and Customer Service Occupations (SOC 7), Process, Plant and Machine Operatives (SOC 8).
- Low Skills: Elementary Occupations (SOC 9).
Contractually Secure employment: Contractually secure employment is currently based on responses to questions asking about whether employees aged 16 and over are employed on a permanent basis.
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