Economic activity

Concepts and definitions
A.
Economically active population (paras. 2.237-2.239)
1.
Usually active population
2.
Currently active population, or labour force
 
i.
Employed population
 
ii.
Unemployed population
B.
Population not economically active (para. 2.247)
1.
Population not usually active
2.
Population not currently active (in other words, population not in the labour force)
C.
Time worked (para. 2.323)
D.
Occupation (para. 2.301)
E.
Industry (para. 2.306)
F.
Status in employment (paras. 2.310-2.311)
G.
Income (para. 2.331)
H.
Institutional sector of employment (para. 2.335)
I.
Place of work (paras. 2.346-2.347)
   
 

A. Economically active population (paras. 2.237-2.239)

The economically active population comprises all persons of either sex who provide the supply of labour during a specified time reference period, as employed or as unemployed, for the production of economic goods and services, where the concept of economic production is established with respect to the System of National Accounts (SNA)1. Activities are within the economic production boundary defined by the SNA if they comprise: (a) Production of goods or services supplied, or intended to be supplied to units other than their producers, including the production of goods and services used up in the process of producing such goods or services (intermediate consumption); (b) Production of all goods retained by their producers for their own final use (own-account production of goods); (c) Production of housing services by owner-occupiers; (d) Production of domestic and personal services produced by paid domestic staff.

Own-account production of goods includes, for example, production of agricultural products and their subsequent storage; production of other primary products such as mining of salt, cutting of peat, supply of water; processing of agricultural products (the preparation of meals for own consumption is excluded); and other kinds of processing, such as weaving of cloth, dressmaking and tailoring; production of footwear, pottery, utensils or durables; making of furniture or furnishings; and major renovations, extensions to dwellings, replastering of walls or re-roofing by
owners of owner-occupied dwellings. It is advisable for countries to develop a more extensive list of such own-account production activities considered to be within the SNA production boundary, so as to ensure that those involved in such activities are correctly classified as economically active. In principle, the production of all goods falls within the SNA production boundary, irrespective of whether the goods are intended for supply to other units or for the producers’ own final use. In practice, however, the production of a good for own final use within households should be recorded only if the amount of the good produced by households for their own final use is believed to be quantitatively important in relation to the total supply of that good in a country. According to the Thirteenth International Conference of Labour Statisticians, persons engaged in the production of goods for own final use within the same household should be considered as economically active only if such production comprises an important contribution to the total consumption of the household.

Domestic or personal services provided by unpaid household members for final consumption within the same household are excluded from the economic production boundary and hence are not considered to be economic activities. (Examples are (a) the cleaning, decoration and maintenance of the dwelling occupied by the household, including small repairs of a kind usually carried out by tenants as well as owners; (b) the cleaning, servicing and repair of household durables or other goods, including vehicles used for household purposes; (c) the preparation and serving of meals; (d) the care, training and instruction of children; (e) the care of sick, infirm or old people; and (f) the transportation of members of the household or their goods.) Persons engaged in such activities may be included among “providers of non-paid social and personal services”.

A.1 Usually active population

The usually active population comprises all persons above a specified age whose main activity status, as determined in terms of the total number of weeks or days during a long specified period (such as the preceding 12 months or the preceding calendar year) was employed and/or unemployed, as defined within the labour force (current activity) framework.

A.2 Currently active population, or labour force

The currently active population, or the labour force, comprises all persons (above the stated minimum age) who are either employed or unemployed, as defined below.

A.2.i Employed population

The employed population comprises all persons above the minimum age specified for measurement of the economically active population who, during a short reference period of either one week (preferred option) or one day (a) performed some work for pay, profit or family gain, in cash or in kind; or (b) were temporarily absent from a job in which they had already worked and to which they maintained a formal attachment or from a self-employment activity such as a business enterprise, a farm or a service undertaking.

A.2.i Unemployed population

The unemployed population comprises all persons above the minimum age specified for measurement of the economically active population who during the reference period were:

(a)
Without work, in other words, were not in paid employment or selfemployment, where work is as defined in paragraph 2.237 above;
(b)
Currently available for work, in other words, were available for paid employment or self-employment during the reference period;
(c)
Seeking work, in other words, had taken specific steps in a specified recent period to seek paid employment or self-employment. (The specific steps may have included registration at a public or private employment exchange; application to employers; checking at worksites, farms, factory gates, markets or other places of assembly; placing or answering newspaper or other forms of public advertisements; seeking assistance of friends and relatives; looking for land, building, machinery or equipment to establish one’s own enterprise; arranging for financial resources; applying for permits and licences, and so forth.) It would be useful to distinguish firsttime job seekers, who have never worked before, from other job seekers in the classification of the unemployed. Such a separation would be useful for policy purposes as well as in improving international comparability of employment statistics. To do so, however, may require an additional question regarding previous work experience, which may be too much for a population census.

In general, to be classified as unemployed, a person must satisfy all three of the above criteria. However, in situations where the conventional means of seeking work are of limited relevance, where the labour market is largely unorganized or of limited scope, where labour absorption is, at the time, inadequate, or where the labour force is largely self-employed, the standard definition of unemployment may be applied by relaxing the criterion of seeking work. Such a relaxation is aimed primarily at those developing countries where the criterion does not capture the extent of unemployment in its totality. With this relaxation of the criterion of seeking work, which permits in extreme cases the criterion’s complete suppression, the two basic criteria that remain applicable are “without work” and “currently available for work”.

In the application of the criterion of current availability for work, especially in situations where the seeking-work criterion is relaxed, appropriate tests should be developed to suit national circumstances. These tests may be based on notions such as present desire for work, previous work experience, willingness to take up work for wage or salary on locally prevailing terms, and readiness to undertake self-employment activity, given the necessary resources and facilities. These criteria are expected to ensure objectivity in the expression of current availability.

B. Population not economically active (para. 2.247)

The “not economically active” population comprises all persons, irrespective of age, including those below the age specified for measuring the economically active population, who were not “economically active” as defined above.

B.1 Population not usually active

The “population not usually active” comprises all persons, irrespective of age and of sex, whose main activity status during the long reference period used to measure usual activity was neither employed nor unemployed. It is recommended that this population be classified into the following four groups:

(a)
Students: Persons not classified as usually economically active, who attended any regular educational institution, public or private, for systematic instruction at any level of education;
(b)
Homemakers: Persons not classified as usually economically active, who were engaged in household duties in their own home, for example, spouses and other relatives responsible for the care of the home, children and the elderly (domestic employees, working for pay, however, are classified as economically active);
(c)
Pension or capital income recipients: Persons not classified as usually economically active, who receive income from property or investments, interest, rent, royalties or pensions from former economic activities;
(d)
Others: Persons not classified as usually economically active who are receiving public aid or private support, and all other persons not falling into any of the above categories (for example, children not attending school).

B.2 Population not currently active (not in the labor force)

The population not currently active or, equivalently, persons not in the labour force, comprises all persons who were neither employed nor unemployed during the short reference period used to measure current activity, including persons below the minimum age specified for measurement of the economically active population.

They may be classified, according to reason for not being currently active, in any of the following groups:

(a)

Attending an educational institution refers to persons not currently active, who attended any regular educational institution, public or private, for systematic instruction at any level of education, or temporary absence from the institution for relevant reasons corresponding to those specified for persons temporarily not at work;

(b)

Performing household duties refers to persons not currently active, who engaged in household duties in their own home, such as spouses and other relatives responsible for the care of the home, children and elderly people. (Domestic and personal services produced by domestic employees working for pay in somebody else’s home are considered as economic activities in line with paragraph 2.237 above.);

(c)

Retiring on pension or capital income refers to persons, not currently economically active who receive income from property or investments, interests, rents, royalties or pensions from former economic activities;

(d)

Other reasons refers to all persons, not currently economically active, who do not fall into any of the above categories (for example, children not attending school, those receiving public aid or private support and persons with disabilities).


C. Time worked (para. 2.323)

Time worked is the total time actually spent producing goods and services, within regular working hours and as overtime, during the reference period adopted for economic activity in the census. It is recommended that if the reference period is short, for example, the week preceding the census, time worked should be measured in hours. In this case, time worked may be measured by requesting separate information for each day of the week. If the reference period is long, for example, the 12 months preceding the census, time worked should be measured in units of weeks, or in days where feasible, or in terms of larger time intervals. Time worked should also include time spent in activities that, while not leading directly to produced goods or services, are still defined as part of the tasks and duties of the job, such as preparing, repairing or maintaining the workplace or work instruments. In practice, it will also include inactive time spent in the course of performing these activities, such as time spent waiting or standing by, and in other short breaks. Longer meal breaks and time spent not working because of vacation, holidays, sickness or industrial disputes should be excluded.

D. Occupation (para. 2.301)

Occupation refers to the type of work done in a job by the person employed (or the type of work done previously, if the person is unemployed), irrespective of the industry or the status in employment in which the person should be classified. Type of work is described by the main tasks and duties of the work.

E. Industry (para. 2.306)

Industry (branch of economic activity) refers to the kind of production or activity of the establishment or similar unit in which the job(s) of the economically active person (whether employed or unemployed) was located during the time-reference period established for data on economic characteristics.

F. Status in employment (paras. 2.310-2.311)

Status in employment refers to the type of explicit or implicit contract of employment with other persons or organizations that the economically active person has in his/her job. The basic criteria used to define the groups of the classification are the type of economic risk, an element of which is the strength of the attachment between the person and the job, and the type of authority over establishments and other workers that the person has or will have in the job. Care should be taken to ensure that an economically active person is classified by status in employment on the basis of the same job(s) as used for classifying the person by “occupation”, “industry” and “sector”.

The International Classification of Status in Employment (ICSC) classifies the economically active population by status in employment as follows:

(a)
Employees, among whom it may be possible to distinguish between employees with stable contracts (including regular employees) and other employees;
(b)
Employers;
(c)
Own-account workers;
(d)
Contributing family workers;
(e)
Members of producers' co-operatives;
(f)
Persons not classifiable by status.

G. Income (para. 2.331)

Income may be defined as:

  (a)
Income, in cash or kind, received by each household member;
  (b) Total household income in cash and in kind from all sources.

The preferred reference period for income data should be the preceding 12 months or past year. The income could be classified as income from paid employment, selfemployment, property and other investment, transfers from governments, other households and non-profit institutions.

H. Institutional sector of employment (para. 2.335)

The institutional sector of employment relates to the legal organization and principal functions, behaviour and objectives of the enterprise with which a job is associated. Following the definitions provided in the System of National Accounts (SNA), it is recommended, if the census is to provide information on this topic, that the following institutional sectors be distinguished:

  (a)

Corporation, comprising non-financial and financial corporations (in other words incorporated nterprises, private and public companies, joint-stock companies, limited liability companies, registered cooperatives, limited liability partnerships, and so forth) and quasi-corporations (that is to say, an unincorporated enterprise that is managed as if it were a corporation, in that a complete set of accounts is kept), as well as non-profit institutions, such as hospitals, schools and colleges that charge fees to cover their current production costs;

  (b)
General government, comprising central, state and local government units together with social security funds imposed or controlled by those units, and non-profit institutions engaged in non-market production controlled and financed by government, or by social security funds;
  (c)
The institutional sector of employment relates to the legal organization and principal functions, behaviour and objectives of the enterprise with which a job is associated. Following the definitions provided in the System of National Accounts (SNA), it is recommended, if the census is to provide information on this topic, that the following institutional sectors be distinguished: Non-profit institutions serving households (for example, churches, professional societies, sports and cultural clubs, charitable institutions and aid agencies) that provide non-market goods and services for households (that is to say, free or at prices that are not economically significant) and whose main resources are from voluntary contributions;
  (d)
Households (including unincorporated enterprises owned by households) comprising unincorporated enterprises directly owned and controlled by members of private and institutional households (made up of persons staying in hospitals, retirement homes, convents, prisons and so forth, for long periods of time), either individually or in partnership with others. Partners may be members of the same household or from different households.

I. Place of work (paras. 2.346-2.347)

Place of work is the location in which a currently employed person performed his or her main job, and where a usually employed person performed the main job used to determine his/her other economic characteristics such as occupation, industry and status in employment. Type of place of work refers to the nature of the workplace and distinguishes between the home and other workplaces, whether fixed or otherwise.

The following response categories, or a variation thereof necessitated by national circumstances, are recommended for classifying type of place of work:

  (a)
Work at home: This category includes those whose economic activities are conducted from within the home, such as farmers who work and live on their farms, homeworkers, self-employed persons operating (work)shops or offices inside their own homes, and persons working and living at work camps;
  (b)
No fixed place of work. This category should be restricted to persons whose work involves travel in different areas and who do not report daily in person to a fixed address, for example, travelling salesmen, taxi drivers and long-distance lorry drivers. It also includes ambulant vendors, operators of street or market stalls which are removed at the end of the workday, construction workers working at different sites during the reference period and push-cart operators, and so forth.
  (c)

With a fixed place of work outside the home. This category will include the remaining employed population. To this group should also be classified persons who do not have a fixed place of work but who report to a fixed address at the beginning of their work period (for example, bus drivers, airline pilots and stewards), as well as operators of street or market stalls which are not removed at the end of the work day. This group may also include individuals who travel to work, on a regular basis, across the border
to a neighbouring country. Persons working at changing sites, for example, in construction, should give the location of their current worksite rather than the address of their employer’s place of business, if appearance at this site will be required for at least one week.

Notes:

1 Commission of the European Communities/Eurostat, International Monetary Fund, Organization for Economic Cooperation and Development, United Nations and World Bank, System of National Accounts 1993 (United Nations publication, Sales No. E.94.XVII.4).

 

United Nations Statistics Division - Demographic and Social Statistics