This is the final part of our series looking at what constitutes Labour Market Information (Parts 1,2,3 and 4 of this series can be accessed here, here, here and here.) We have also compiled the series into a new PDF, which you can download by clicking here or on the image at the bottom of the page.
Real Time LMI?
One of the solutions that has become popular in recent years is what is often known as Real-Time LMI. Unlike what is sometimes called “traditional LMI”, this does not rely on public datasets, but is rather derived from conducting a sweep of job vacancies and CV’s on the internet. The benefits of this approach are clear. Unlike “traditional” LMI, which relies on past data, a sweep of job postings and CVs can be done on a daily basis and therefore provides much more up to data information. Sophisticated services can also mine textual information to highlight very specific requirements and skillsets desired for specific roles.
However, although this approach can be useful in many ways, there are many reasons to treat it with a good deal of caution. Recalling the definition we gave of LMI (see Part 1), we stated that the purpose of LMI was to help us understand the structural trends of the economy. Although job postings can help us understand aspects of the labour market, they cannot by themselves help us understand the structures and trends of the labour market since they are only taking a brief snapshot of what is happening. As with our football illustration in Part 3, if job postings are taken in isolation, rather than as a complement to “traditional LMI,” they can be misleading. In addition to this general problem, there are a number of other specific reasons why we should perhaps treat “Real Time LMI” with caution:
Employers do not always advertise their jobs
According to Reed NCFE, the number of actual jobs out there that are advertised might be as little as 30%, and this is often especially true for highly skilled careers.
Job vacancies are often duplicated
This is especially likely when an employer goes through an agency as they often employ a variety of different methods and means of advertising a job.
A single job vacancy can refer to multiple jobs
Often a company will create a single online job posting, then select more than one employee from the applicants for that single job posting.
Not all jobs that are advertised will be picked up by Real-Time LMI sweeps
There is simply no way for every job on the internet to be picked up in a Real-Time sweep, and of course not all jobs are advertised on the internet.
Many jobs are seasonal, and so a snapshot of jobs postings at certain times — say in the run up to Christmas — will not give a true indication of labour market trends.
Let us be clear what we are saying and equally what we are not saying. We are not saying that job postings are worthless. On the contrary, job postings can be extremely useful. For example, a college that is thinking of setting up short-term, customized industry training would find this approach useful. However, in and of themselves, job postings or “Real Time LMI” are not strictly LMI, in that they cannot help us to understand the structural trends and demands of an economy.
As we said at the start, our purpose in putting this series together has not been to provide an exhaustive
account of all the issues surrounding LMI. Rather, our intention was simply to provide answers to some of the most basic questions that are thrown up.
What we have shown is that LMI is a more complex issue than many who use it perhaps realise. There are
issues around the raw datasets, such as strengths and weaknesses and data suppressions. Then there are
issues around industry and occupation granularity. There are issues around producing data which is accurate at the local and county levels. And there are issues around using current job postings.
What this means is that there can often be wide variations in the quality of the data on offer, and organisations that are using or planning to use an LMI solution might want to consider the issues raised in this paper carefully before making a decision on which solution or solutions they use.
Often the decision might be dictated to by a question of budget, but hopefully we have shown enough in this series to help people better understand why some solutions might be cheaper or more expensive than others. For those who might be considering which solution to use, let us finish off by suggesting five questions that you might want to ask potential LMI suppliers:
- Do you work to eliminate weaknesses in the public datasets?
- Do you work to eliminate suppressions in the public datasets?
- If not, do you make assumptions of what is happening at the granular (3 or 4-digit) industry and occupation levels, based on the data at the 2-digit level?
- Do you make assumptions of what is happening at the local labour market level based on what is happening at the larger regional level?
- Does your LMI rely on job postings, and if so, can I be confident that it gives an accurate picture of the structures and trends in my labour market?
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