About the data
The Labour Force Survey (LFS) collects information from individuals on issues related to employment. In particular it collects information on occupation, training, hours of work and the personal characteristics of everyone in the household over the age of 15. It is also the largest survey that collects information on education and very detailed job characteristics - such as whether an employee does shift work and has managerial duties - along with hours and earnings. The Special Licence Access edition of the LFS has additional information on employees' workplace location by Unitary Authority and Local Authority District (UALAD).
How the data were used
How does the health service distribute resources equitably across England? In this project the data were used to calculate a key component in the Department of Health's resource allocation formula. This component, the staff Market Forces Factor (MFF), is used to compensate NHS organisations for differences in staff and the costs of commissioning or providing healthcare across various locations throughout England. The job responsibility adjustment within the staff MFF is calculated using the LFS.
MFFs are calculated by pooling three years of information from
the Annual Survey of Hours and Earnings (ASHE). While ASHE is
the largest such survey in Britain, it does not contain information
on firm sizes nor on employees' managerial roles and job
responsibilities. It is recognised that there are areas where
a higher proportion of large firms and workers of greater
managerial responsibilities are found. These tend to be
metropolitan areas - for example, bankers in central London
tend to play a different role than bankers in smaller towns. The
adjustment acknowledges the relationship between higher
responsibility and higher wages - it adjusts the MFF downward
in areas where there are higher wages due to greater employee job
responsibilities.
Currently the job responsibility adjustment used in the staff MFF
is by Government Office Region level, but the implementation of the
adjustment by UALAD level has been explored using these Special
Licence data. The authors found that where the higher
responsibility adjustment is calculated at a local authority level
the MFFs are distributed more densely. There is therefore a case
for reconsidering how this adjustment is applied.
The research is published in the Department of Health's Resource Allocation Research Paper 34b (RARP 34b) The Staff Market Forces Factor Component of the Resource Allocation Weighted Capitation Formula: Refinements to Method, under the Higher Responsibility Adjustments section.
About the author
The research team was led by Professor Robert F. Elliott, Director of the Health Economics Research Unit (HERU) at the University of Aberdeen. The case study was authored by Dr Ada Ma, also with HERU at the University of Aberdeen.
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