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Better Employer Records Could Advance Research, Statistics, Evaluation

1 May 2023 557 views One Comment
Erica L. Groshen of Cornell University ILR School; Demetra Nightingale of Urban Institute; and Andrew Reamer, Youstina Magdy, and Madison Raju of The George Washington University

    How could our national data infrastructure serve us better in the 21st century? As the pandemic struck the US in early 2020, policymakers moved decisively to help protect Americans’ health and economic well-being. Now, as the pandemic recedes, important questions remain about jobs and work: How well did policy steps work? Could policies have been better targeted? What does the ‘new normal’ look like?

    A new report suggests more uniform and enhanced standards for employers’ records on workers could enable us to answer such questions quickly. Wage records maintained by employers contain valuable information about the business, its workers, and their pay. Some of these records are collected and used by governments for unemployment insurance programs, other policy and tax programs, research, and national statistics.

    Even so, US wage record systems are characterized by few common standards in source data, minimal and uncoordinated data fields, and limited accessibility for analysis. These deficiencies impede production of more timely, accurate, relevant, and granular labor market statistics and research for the public good. In addition, nonuniform, noninteroperable wage records and collections make it costly for employers to comply with reporting requirements and benchmark data for their own purposes.

    Jobs and Employment Data Exchange (JEDx) Initiative

    Modern technology and data science offer a major opportunity to upgrade systems for employer wage records. One effort in this direction is the Jobs and Employment Data Exchange (JEDx) initiative, led by the US Chamber of Commerce Foundation. Currently, the main information in wage records that governments collect are a worker’s identification code and quarterly earnings, plus the employer’s identification code, location, and industry. The public-private JEDx initiative aims to enhance the content and systems for these records for the mutual benefit of businesses and government.

    Potential for Improving Official and Other Statistics

    A recent report published by the JEDx-Research Enhancement Project (JEDx-REP) and funded by the Alfred P. Sloan Foundation advises JEDx on how to best support research, statistics, and evaluation outcomes. The report finds that standardized records with richer detail on worker and business characteristics could benefit many important activities, including the following:

    • Official federal and state statistical reports: Improved estimates of gross domestic product, gross domestic income, productivity, occupational trends, labor market dynamics, employment, and geographic conditions
    • Social science research: Estimating interactions between earnings and education or training, the impact and nature of employer-jobholder relationships, and the spatial nature of work arrangements
    • Program evaluation: Assessing the individual and community outcomes and costs and benefits of education and workforce development programs
    • Benchmarking, analytics, and tracking: Informing local occupational demand and supply analysis, job quality measurement, local/state/regional economic development strategies, and equal employment opportunity regulations

    Recommendations for JEDx

    The report also presents the following recommendations for JEDx going forward:

    1. Quickly develop prototypes of new data products of high value to data providers and users
      a. Improved benchmarking and analysis of regional/state/local occupational supply and demand
      b. More rapid priority policy analysis (e.g., job impacts of extreme weather or high unemployment)
      c. Analysis of social determinants of labor markets and labor force participation (e.g., long-term unemployment, worker skills, location of new or high-quality jobs)
    2. Focus on data enhancements that will improve statistics and research
      a. Prioritize worker information likely to be easiest for employers to provide, particularly hours worked and paid; geocode work location and worker residence; job title; employment start and stop dates and reason for separation; nature of employer-worker relationship (regular employee, full-time or part-time, union status); compensation, earnings, wages; identifying codes for employer and worker to facilitate linking for statistical and research purposes
      b. Collect earnings and hours information more frequently than quarterly, with more granularity and on a more timely basis
      c. Devise a strategy for obtaining universal data (all workers, all employers, all states)
      d. Explore other sources for several high-priority data enhancements difficult for employers to provide, including nonstandard workers, worker demographics, education and training attainment, occupation, duties, and skill requirements
    3. Recognize different access modes are required to address different research uses, thus:
      a. Include an explicit pilot to provide researchers with access to the data to generate products of value to policymakers, businesses, researchers, and other interested parties
      b. Include government agencies in pilots to provide internal and/or external researchers with access to the comprehensive, fully curated microdata that underlie official statistics and other government information products, including any data shared by a JEDx system
      c. Support the establishment of one or more public-private portals, such as an administrative data research facility (possibly state-sponsored) and explore tiered access for different kinds of research

    Technological advances provide new opportunities for enhanced reporting systems—like JEDx—that can result in better data for employers, researchers, and policymakers to improve our understanding of labor markets and jobs.

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