A little bit of history
14 April 2016
The measurement of unemployment was first discussed by the 2nd ICLS in 1925. At the time, a main concern was to address unemployment as a social problem, particularly in States undergoing industrialization; an issue closely linked to the ILO's mandate of promoting social justice and social protection for all workers. The Conference adopted the first resolution relating to unemployment statistics with a view to identifying the number of persons insured against unemployment, the number of unemployed in receipt of benefits and the total amount paid in benefits during the year. The information was to be derived mainly from unemployment insurance records or from data compiled by employment offices or through population censuses. Sample survey methodology was in its early days and so "special inquiries relating to a sample of the population" were only considered as a supplementary statistical source.
Concern with developing broad measures of potential labour supply and available skills led to the first international definition of the “gainfully occupied population,” proposed in 1938 by the Committee of Statistical Experts of the League of Nations. The Committee defined the concept of gainful occupation as any “occupation for which the person engaged therein is remunerated, directly or indirectly, in cash or in kind.” The concept was proposed for measurement primarily through population censuses —the main source of employment and unemployment statistics until the Second World War. The concept captured persons who reported having a particular occupation, trade or profession from which they generated income in cash or in kind, regardless of whether they were actually engaged in that activity at the time of the census.
After the Second World War, the policy priorities shifted from unemployment as a social problem to employment as a main engine of economic reconstruction and growth. The concept of gainful occupation had been useful in broadly identifying the pool of available workers in given trades and occupations. This measure, however, was deemed not as suitable for use in macroeconomic monitoring. Thus, in 1947 the 6th ICLS adopted a resolution that, for the first time, defined employment and unemployment on the basis of the activities performed by persons during a specified period. The resolution also introduced the concept of the “labour force” as comprising the employed and the unemployed. The new measurement approach, based on an activity principle and priority rule, aimed to improve the objectivity of the measures, which were increasingly based on data collected through household surveys. These standards were reviewed in 1954 by the 8th ICLS with a view to provide more detailed operational definitions for the measurement of employment and unemployment in a short reference period as well as recommendations on the scope and tabulation of the statistics.
Parallel developments in the area of national accounts during the 1940s resulted in the publication of the System of National Accounts and Supporting Tables in 1953 by the United Nations. The 1953 SNA contained the first international recommendations on the topic, including a general definition of production as "the provision of goods and services" and a more restricted production boundary for use in national accounting. This boundary, now referred to as the SNA production boundary, was established for practical reasons to facilitate the measurement and valuation of production in an economy. Included within the SNA production boundary were the production of all goods and services intended to be sold or exchanged in the market, including paid domestic services rendered to households. Also included were housing services produced by owner-occupiers (which involve no labour inputs) and the production of goods for own final use by the producer or by members of his or her household. Excluded from the SNA production boundary were all services produced for own consumption by households. These standards were revised in 1968, 1993 and again in 2008.
At par with the measurement of employment and unemployment, the ICLS also discussed on various occasions the need for information to address issues of insufficient labour absorption, labour market mismatches and inadequate employment situations. The first international statistical definition of underemployment was adopted in 1957 by the 9th ICLS. General recommendations for the measurement and analysis of underemployment and underutilization of manpower followed in 1966 with the adoption, by the 11th ICLS, of a number of measures of underemployment related to insufficient quantity of work (visible underemployment), inadequate income (disguised underemployment), low productivity (potential underemployment), as well as discouragement and other barriers to employment (underutilization of manpower).
The topic of labour force statistics was once again reviewed by the 13th ICLS in 1982. The resolution adopted by the Conference further specified the guidelines for the measurement of employment and unemployment. In particular, it established a formal conceptual link between the scope of employment and the SNA production boundary. To address the need for current and non-current measures of economic activity the resolution introduced the concepts of the economically active population, covering the currently active population (labour force) and the usually active population; the population not economically active; and the population not usually active. To promote the development of underemployment and related statistics, it integrated the measurement of visible underemployment into the labour force framework and introduced options to relax the seeking work criterion to measure unemployment in specific settings. The guidelines on the measurement of underemployment were further revised and updated in 1998 with the adoption by the 16th ICLS of the resolution concerning the measurement of underemployment and inadequate employment situations.