Quality improvements for the labour force survey Grant Agreement no

What and how we tested? Two of model questionnaires were tested: V2 (developed by TF HMEU) VPT (proposed by Statistics Portugal) Only two modules namely „At work” and „Producing goods” were supposed to be tested, but because employment rate cannot be computed without module „Absences from work”, this module was also included in the test. .

What and how we tested? A sample of 9315 dwellings, located in 8 counties (7 counties and Bucharest Municipality) was selected. The volume of the sample drawn for the pilot equals 5/4 of the normal quarterly sample in the respective counties. The actual number o persons surveyed were of 11589. In each county, the sample of the pilot was split, dwelling being randomly allocated to one of the questionnaires to be tested (V2 or VPT). All persons aged 15-64 years living in the dwelling were asked to fill in the same version of questionnaire (V2 or VPT). Data collection was performed in the second quarter of 2016. The sample was uniformly spread on the 13 reference weeks of the quarter. Non-response rate for the entire sample was 22.3

Distribution of the sample (of individuals) achieved for V2, VPT and comparison with the regular LFS sample in the 8 counties included in the test Same reference period as the pilot survey (i.e. second quarter of 2016)   LFS V2 VPT Abs. % Total 8414 100.0 5981 5608 Age groups 15-24 ani 1204 14.3 912 15.2 758 13.5 25-34 ani 1484 17.6 1013 16.9 993 17.7 35-44 ani 1850 22.0 1232 20.6 1295 23.1 45-54 ani 1905 22.6 1375 23.0 1211 21.6 55-64 ani 1971 23.4 1449 24.2 1351 24.1 Urban/ rural area Urban 5148 61.2 3787 63.3 3534 63.0 Rural 3266 38.8 2194 36.7 2074 37.0 Sex Masculin 4133 49.1 2939 2773 49.4 Feminin 4281 50.9 3042 2835 50.6 County Alba 764 9.1 458 7.7 443 7.9 Bistrita-Nasaud 571 6.8 377 6.3 385 6.9 Braila 537 6.4 346 5.8 352 Dambovita 982 11.7 704 11.8 615 11.0 Dolj 1414 16.8 1016 17.0 878 15.7 Neamt 826 9.8 562 9.4 500 8.9 Timis 1360 16.2 14.7 871 15.5 Bucuresti 1960 23.3 1640 27.4 1564 27.9

Non-response rate for the pilot survey and the regular LFS Same reference period as the pilot survey (i.e. second quarter of 2016)   LFS Q2 2016 Total pilot survey Pilot survey V2 sub sample Pilot survey VPT sub sample Total 25.9 22.3 22.7 21.8 Alba 8.8 12.0 14.3 9.5 Bistrita Nasaud 10.9 10.6 13.2 7.9 Braila 25.2 20.4 22.2 18.5 Dambovita 10.3 8.1 6.6 9.8 Dolj 0.0 Neamt 13.5 13.3 13.7 Timis 6.7 7.6 5.6 Bucuresti 51.5 42.9 43.1 42.6

Translation issues V2_EAW1a was translated in Romanian as “In the week from Monday the [date] to Sunday the [date], did you have a place of work or an own account business?” V2_EAW1b was translated in Romanian as “In that week did you carry out any other activity for wage or other incomes in cash or kind, even if it was only a short or occasional one?” V2_EAW1c was translated as “In that week, did you carry out any unpaid activity for a business owned by a family member?” VPT_EAW1 was translated as “In the last week, did you work even if it was only for one hour?”. VPT_EAW3 was translated as “Did you work for a business owned by a family member?”

Main results Experiences from the field test No special problems were reported regarding the questions, except perhaps: for questions 1 and 3 of V2 as well as for question 3 of VPT - where the word “business” generated some confusion among farmers which did not understood if this is or not a “business”. for V2, it was reported that some people tend to respond positively to the second question although they are unpaid family workers and should provide a positive answer in the third one. Without doubts, VPT was the preferred version due to its simplicity, shortness and ease of administration. Questionnaire V2 was considered to complicated, with too many filters and questions that are perceived as useless or even annoying. Please note that data collection was PAPI It should be noted that the evaluation was made for the each questionnaire as a whole and not for each sub-module separately. So, the result is influenced by the fact that in V2, all persons (all potentially employed as well as all not employed) are routed to sub-module “Producing goods”.

Main results Quantitave - Questionnaire V2 The opening questions (V2_EAW1a) gather 92.8% of total employment while the subsequent two questions have a very modest contribution (1.4% of total employment - V2_EAW1b and 0.2% of total employment - V2_EAW1c). EPG1c gathers another 193 respondent 5.5% of total employed while EPG4 has virtually no contribution (only one observation classified as employed due only to this question). Out of 3487 respondents potentially employed (after V2_EAW1a, b and c): 3150 respondents (90.3%) are not self-employed in agriculture or were absent from work and did not work, supplementary, in agriculture; 152 respondents (4.4%) are self-employed in agriculture and their status as employed is confirmed by sub- module ‘Producing goods”; 185 respondents (5.3%) are also working as self-employed in agriculture but are excluded from employment after sub-module “Producing goods”. Without routing potential employed to the module “Producing goods”, 136 respondents giving a positive reply to V2_EAW1a, 44 respondents giving a positive reply to V2_EAW1b and 5 respondents who answered “yes” to V2 would have remained in employment even if they are not in fact employed.

Main results Quantitave - Questionnaire VPT The opening question captures 98.6% of total employment. The remaining shares are brought by: sub-module “Producing goods”: 21 new respondents (0.6%) by V1_EPG2 and 3 new respondents (0.1%) by V1_EPG4 EAW4 (and confirmed by sub-module “Absences”): 21 respondents (0.6%) Out of 3663 respondent providing a positive reply to VPT_EAW1, status as employed is confirmed for 3252 respondents by: being paid (VPT_EAW2) - for 3009 respondents (92.5%); being unpaid family worker (VPT_EAW3) – for 23 respondents (0.7%); V1_EPG2 in sub-module “Producing goods” – for 217 respondents (6.7%)

Main results Impact on the employment rate The new ICLS definition, which is different from the current one in respect to treatment of own-use producers, is expected to have a negative impact on the employment rate measurement for Romania, where this group of persons has a significant share of total employment Both, V2 and VPT, questionnaires are designed to implement the new definition. Nevertheless, they include (for testing purpose) one question, namely EPG3a, which could be used to reproduce, more or less, the old definition of employment. This question could, potentially, be used after the adoption of the Framework Regulation and new Implementing act of the LFS to compute, in parallel, estimates of the employment rate according to “new” and “old” definition Consequently, for each of the two questionnaires, two employment indicators were computed: employment according to new definition employment according to old definition

Main results Impact on the employment rate Points to be keept in mind when interpreting the results: questions in the module “Producing goods” of V2/VPT are not exactly the same as those currently used by Romanian LFS. Thus we can expect that the “old definition” of employment, as computed based on V2/VPT will not exactly reproduce current LFS estimates. For this reasons, we named LFS estimates as “current definition” to be distinguished by “old definition” – as they can be computed based on V2/VPT questionnaires. Relevant questions in the current national questionnaire LFS estimates does not refer to the national estimates. Since the test took place in only 8 counties (according to NUTS3 level) LFS estimates used for comparisons as well as V2/VPT ones refers to these 8 counties only. Results are not weighted. Therefore the results of the assessment must be interpreted carefully. Still they are able to offer a rough estimate of the expected impact of the changes foreseen.

Main results Comparison between LFS (current definition) and V2/VPT (new definition) Employment rate (LFS-current definition versus V2/VPT – new definition) in the 8 counties included in the test, by age groups, urban/ rural area and gender   LFS V2 Diff. V2-LFS VPT Diff. VPT-LFS Total 63.3 58.5 -4.8 58.8 -4.5 Age groups 15-24 ani 20.1 16.2 -3.9 16.8 -3.3 25-34 ani 76.0 75.6 -0.4 74.6 -1.4 35-44 ani 83.8 79.5 -4.3 79.1 -4.7 45-54 ani 79.6 76.5 -3.1 -3.6 55-64 ani 45.3 38.0 -7.3 35.9 -9.4 Urban/ rural area Urban 62.8 64.0 1.2 63.5 0.7 Rural 64.1 49.0 -15.1 50.8 -13.3 Sex Masculin 69.9 65.6 66.0 Feminin 57.0 51.5 -5.5 51.7 -5.3

Main results Comparison between new and old definition (on VP/VPT) Employment rate (V2/VPT – new definition versus old definition) in the 8 counties included in the test, by age groups, urban/ rural area and gender   V2 new V2 old Diff. new-old VPT new VPT old Total 58.5 65.2 -6.7 58.8 65.3 -6.5 Age groups 15-24 ani 16.2 18.9 -2.7 16.8 19.9 -3.1 25-34 ani 75.6 82.0 -6.4 74.6 80.2 -5.6 35-44 ani 79.5 85.2 -5.7 79.1 84.9 -5.8 45-54 ani 76.5 84.0 -7.5 76.0 81.6 55-64 ani 38.0 47.8 -9.8 35.9 46.3 -10.4 Urban/ rural area Urban 64.0 64.6 -0.6 63.5 -0.5 Rural 49.0 66.2 -17.2 50.8 67.5 -16.7 Sex Masculin 65.6 72.4 -6.8 66.0 72.3 -6.3 Feminin 51.5 58.3 51.7 58.4

Main results Comparison between LFS (current definition) and V2/VPT (old definition) Employment rate (LFS-current definition versus V2/VPT – old definition) in the 8 counties included in the test, by age groups, urban/ rural area and gender   LFS V2 Diff. V2-LFS VPT Diff. VPT-LFS Total 63.3 65.2 1.9 65.3 2.0 Age groups 15-24 ani 20.1 18.9 -1.2 19.9 -0.2 25-34 ani 76.0 82.0 6.0 80.2 4.2 35-44 ani 83.8 85.2 1.4 84.9 1.1 45-54 ani 79.6 84.0 4.4 81.6 55-64 ani 45.3 47.8 2.5 46.3 1.0 Urban/ rural area Urban 62.8 64.6 1.8 64.0 1.2 Rural 64.1 66.2 2.1 67.5 3.4 Sex Masculin 69.9 72.4 72.3 2.4 Feminin 57.0 58.3 1.3 58.4

Conclusions and recommendations Quantitative results shows that the two questionnaires, despite of having different flow and wording of questions, gives close values of employment rates. This of course may not be true in each country and it may depend on the employment pattern. Since the two questionnaires seem to provide similar results, our recommendation is for VPT which is simpler from the design point of view and less burdensome for the respondents. As an overall effect of using the new definition of employment and the model questionnaire/ flow chart, employment rate is expected to decrease by 4.5 – 4.8 p.p. However, the magnitude of change, as it can be measured using additional question EPG3a in module “Producing goods” overestimate this impact up to 6.5-6.7 p.p. Thus, we do not recommend this solution which will overestimate the magnitude of the break in series.