Wage and employment dynamics in Britain

ADR UK is working with the University of the West of England (UWE), University College London (UCL), City, University of London and the National Institute of Economic and Social Research on Wage and Employment Dynamics. This data linkage project is providing important new insights into the dynamics of earnings and employment in Britain.

Starting in October 2019, and now in its second funding period, the project will increase understanding of how people’s wages progress through their careers. Data linkages will facilitate analysis through the lens of key characteristics such as gender and ethnicity, as well as the particular dynamics of low-pay labour markets. 

The data 

ADR UK partner, the Office for National Statistics (ONS) is supporting the secure linkage of five key data sources for this project:

• Annual Survey of Hours and Earnings, Great Britain (ASHE) – which measures employee earnings
• Business Structure Database – which is a snapshot in time of all the firms in the UK registered for VAT and/or Pay As You Earn (PAYE)
• 2011 Census data (England and Wales) – a detailed snapshot of the population and its characteristics
• HMRC Pay As You Earn Real Time Information (PAYE RTI) and Self-Assessment data (England and Wales) – providing data related to employment spells and earnings, as well as income from occupation pensions
• HMRC Migrant Workers Scan – to support dynamic analysis of the migrant labour market experience

Data for the Wage and Employment Dynamics project is being linked under the provisions of the Digital Economy Act 2017, which provides a legal gateway for researchers to access government data in a secure way.

Potential of this newly linked data

This project has the potential to transform our understanding of wage and employment issues from labour market entry, through job mobility and career progression to retirement decisions.

The insights provided by the project could be key to informing responses to crucial policy challenges facing the UK, such as reducing in-work poverty. According to the Institute for Fiscal Studies, 58% of those in relative poverty now live in a working household. This demonstrates a need for a better understanding of how to support people in their career and wage progression, in addition to getting more people into employment more broadly.

Wage and Employment Dynamics will also provide insights to help address systemic inequalities within the labour market, such as the gender pay gap – now standing at 8.9%.

Key questions this newly linked dataset could help to address include: 

• How do the structure and earnings of households affect participation in the labour market? 

• What role do employers play in wage inequality? 

• Who does and does not progress out of low pay employment? 

Availability

The ASHE linked to Census 2011 dataset is currently available to access via the ONS Secure Research Service. Accredited researchers can also access the Wage and Employment Dynamics code to create the enriched version of the ASHE dataset via the ONS Secure Research Service.

The linked HMRC dataset should be available by the end of 2023, and the Migrant Workers Scan dataset available by Spring 2024. These timelines are provided as a guide and are subject to change.

Accredited researchers will need to submit and have their project application approved to access the data.

Public engagement

In September 2021, members of the WED Public Engagement Strategic Group came together for their inaugural meeting. This report captures the findings of the discussion.

Publications

• Data Explained: Annual Survey of Hours and Earnings linked to 2011 Census – England and Wales, July 2023

Current grant details

• Project Lead: Damian Whittard
• Researchers include Professor Felix Richie, Van Phan and Naomi Lynch, University of the West of England, Professor Alex Bryson, University College London, Lucy Stokes, National Institute of Economic and Social Research, and Dr John Forth, City University of London.
• Funded value: £240,888
• Duration: October 2022 – March 2025

This project is funded via the ADR UK research-ready data and access fund, a dedicated fund for commissioning research using newly linked administrative data. The funding decision was based on advice from an independent expert panel, and in consultation with the Office for National Statistics. This project is part of the ADR England portfolio.

Details of the funding grant awarded by ADR UK to UWE for this project can also be found on the UK Research and Innovation (UKRI) Gateway to Research platform. Read the funding announcement on our website.