COMPLEMENTING DATA GAPS ON WAGES IN THE LABOUR FORCE SURVEY DATA SET: EVIDENCE FROM POLAND
Due to the low level of quality of the Labour Force Survey (LFS) data set, studies devoted to matching the LFS data with data from alternative sources are frequent. In this paper, we propose a novel method of complementing data gaps on wages in the Labour Force Survey data set. The method is based on estimataing the parameters of the multilevel model explaining wages on the basis of the Structure of Earnings Survey (SES) data set. In such a way, we identify the impact of individual characteristics and enterprise-level features on wages. We also find evidence of random differences between the wages of workers from different professional groups. The relative importance of consecutive groups of variables is evaluated on the basis of the estimates of the parameters of the full model and reduced models. The results of the estimation of the parameters are in line with expectations. The estimates of parameters and predictions of random effects are used in order to calculate the theoretical wages of individuals who do not report wages in the Labour Force Survey. When the predicted wages are compared with the observed ones, some discrepancies are observed. Rationales for these discrepancies are provided. Therefore, the use of a correction factor is proposed. Correction factors are provided for different features of workers and different features of enterprises. The use of the microeconometric multilevel model, as well as the correction factor, leads to reasonable wage estimates of workers not reporting them in the Labour Force Survey. The proposed method may be used in order to complement data gaps on wages for other EU countries.
Jméno a příjmení autora:
Wojciech Grabowski, Karol Korczak
LFS, SES, microeconometrics, mixed-effects model, data gaps
DOI (& full text):
The European Union Labour Force Survey (EU LFS) is a widely used source of information on the participation in the labour force of citizens from the countries of the European Union. The LFS data set…více
The European Union Labour Force Survey (EU LFS) is a widely used source of information on the participation in the labour force of citizens from the countries of the European Union. The LFS data set contains quarterly collected, anonymized data on individuals representing various industries and occupations. The data are collected using common classifications, concepts and definitions. In each country, the same set of characteristics is collected. Despite common standards for data collection, the use of the unified LFS data set may sometimes encounter various difficulties. First of all, from the very beginning of the LFS, there have been numerous methodological changes in sampling (Kerr & Wittenberg, 2015), definitions and classifications (European Commission, 2018). These changes make it difficult to compare data with previous years. Secondly, different cross-national classification rules may produce various problems.