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LEED annual technical notes

Background to LEED

Statistics in this report come from Linked Employer-Employee Data (LEED), which provides information on New Zealanders’ interaction with the labour market and their sources of income. The longitudinal nature of the data allows analysis of income transitions, job tenure, multiple job holding, and self-employment. These statistics are analysed at a ‘person’ level and produced annually.

To produce person-level data, LEED is augmented with self-employment data. LEED is created by linking a longitudinal series of Inland Revenue’s Employer Monthly Schedule (EMS) to employer data from Statistics New Zealand's Business Frame (BF). Official statistics produced from LEED every quarter measure labour market dynamics, providing an insight into the operation of New Zealand's labour market at the job level. For more information see Guide to Interpreting the LEED data.

Annual statistics are available from the 2000 reference tax year onwards because the EMS was introduced in April 1999. The timeliness of the statistics in this report is dependent on a number of factors that necessitate publication around 20 months after the end of the reference tax year.

Data sources

Tax data used in the annual statistics is obtained from three sources.

  • Inland Revenue's employer monthly schedule (EMS), which contains information about monthly earnings of employees and earnings of individuals taxed at source. It does not contain any information relating to the number of hours worked for those earnings. Many types of transfer payments are also made through the EMS and can be identified separately. These are income-tested benefits, New Zealand Superannuation, student allowances, paid parental leave and Accident Compensation Corporation (ACC) payments. About 9 percent of self-employed people are reported as 'employees' in the EMS.
  • Annual tax returns relating to the tax year. This data is added when processing of all relevant annual tax forms is nearly complete. The majority of self-employment data is sourced from annual tax returns.
  • Ministry of Social Development's Benefit Dynamics Dataset (BDD). The BDD is a longitudinal dataset assembled by cleaning and linking benefit administration records for the same individual. The benefit types in the BDD include the main working-age taxable benefits, broken down by the type of benefit.

Note that all median earnings and income figures presented in this report are before tax.

The Business Frame

The Business Frame (BF) is a regularly maintained list of all economically significant businesses and organisations (greater than $30,000 turnover) engaged in the production of goods and services in New Zealand. Its main use is to select businesses for participation in Statistics NZ’s surveys. Information derived from the BF includes:

  • industry
  • sector (private or public)
  • the number of geographical units (physical locations)
  • the count of employees at each geographical unit
  • the ownership structure of the business.

Historically, the BF was based on and updated from annual survey questionnaires. Since 2002, the coverage of the BF has been extended to include more businesses, and its employment information has been maintained using monthly tax data.

While the BF represents a rich source of information on businesses and their structures, a
number of practical limitations remain, which affect its use in the LEED system. Examples are:

  • possible time delays in adding new businesses to the BF and recording businesses that have ceased trading
  • the BF practice of transferring geographical units between businesses at the time of legal changes in ownership, rather than at the time the initial administrative unit ceases to file an EMS.

Tax data

The base data received for LEED is of high quality, but cleaning, transformation and integration processes are required before robust official statistics can be produced. This is necessary because tax data is collected for the purpose of administering New Zealand's taxation system and not primarily for the production of statistics. Integration processes are required to merge Inland Revenue and BF data as the datasets are constructed differently. One of these processes allocates employee jobs from an IRD number to geographical units or physical locations associated with that employer.

It is important to note that Statistics NZ surveys are specifically designed to collect the data required, and the information requested is targeted to the desired measures. In comparison, measures produced that are based on LEED are limited by the characteristics of the base data.

Self-employment data sources

The following tax forms are used for self-employment data:

  • EMS
  • IR3 annual tax form – for individuals who earn income that is not taxed at source
  • IR20 annual partnership tax form – reports the distribution of income earned by partnerships to their partners
  • IR4S annual company tax return – reports the distribution of income from companies to shareholders for work performed (known as ‘shareholder salaries’).

Almost three-quarters of self-employed jobs are identified from annual tax returns.

Note that rental income is not included in LEED. Labour market statistics normally exclude persons whose sole income is from rents, because rental income is regarded as property income. Negative income from self-employment is included. About 20 percent of selfemployment income is negative.

Privacy, security and confidentiality

Statistics NZ and Inland Revenue have an agreement that governs the transfer of tax data for statistical purposes. This process is done under section 81(4)(d) of the Tax Administration Act 1994. Inland Revenue data is encrypted prior to transmission and decrypted upon arrival into Statistics NZ. Unique identifiers (IRD numbers) are individually encrypted, and names and addresses are removed from the Statistics NZ analytical environment. The raw data from Inland Revenue is stored on a separate server from the cleaned (unidentified) data and both these servers are separate from those used for the rest of the organisation. All servers and backup tapes are held under Statistics NZ's highest level of physical security. Access to the data is strictly limited and controlled.

LEED consists of unit record data that are used to produce official statistics and support statistical research. Any information released is in the form of summary statistics or statistical research. No information is released from the data that would allow for the identification of any individual or business. The categories for data release are established so that each cell in a table complies with Statistics NZ confidentiality rules.

To reiterate, LEED is only used for statistical purposes. The data is not available for operational or administrative purposes. In keeping with this policy, Inland Revenue provides data to Statistics NZ but Statistics NZ does not provide data back to Inland Revenue. Any amendments made by Statistics NZ to the Inland Revenue data during processing are for statistical purposes and are not fed back to Inland Revenue.

Population

The LEED annual statistics cover all individuals who either receive income from which tax is deducted at source, or from self-employment. These payments are made by organisations that are registered with Inland Revenue. The data cover wages and salaries paid to employees and self-employment earnings as well as transfer payments such as paid parental leave, student allowances, benefits, New Zealand Superannuation and ACC payments. Transfer payments can be identified separately because they are paid by different IRD numbers. For confidentiality purposes, some individuals are withheld from the data provided to Statistics NZ by Inland Revenue.

Individual people are the fundamental basis of most of the measures in this report. A person is defined as an individual with a unique IRD number present in the tax data in the reference period.

For inclusion in the LEED annual statistics, a person must:

  • be aged 15 years and over at the start of the tax year (to ensure earnings and incomes for 15-year-olds are not artificially biased downwards)
  • have received non-zero income with tax deducted at source through the EMS system, or self-employment income in the reference period
  • have a valid IRD identifier.

(The statistics for transition onto and off benefit relate to transitions for people aged 18–64 years at the 15th of the month of transition.)

Note that the population is different from the one used for quarterly statistics from LEED. The population for the quarterly measures does not include self-employed people. Self-employed individuals reported as employees in the EMS cannot be distinguished from actual employees in the LEED quarterly statistics. However, the correct employment status is assigned to these people for the annual statistics, because this is identified during the extraction of selfemployment data. The quarterly statistics also exclude data about people with government transfers reported through the EMS.

The population of individuals for the LEED annual statistics covers approximately 96 percent of the Household Labour Force Survey estimated working-age population (civilian, noninstitutionalised, resident New Zealand population aged 15 and over).

Sources of income

The term ‘sources of income’ in this report does not cover all possible income sources for New Zealanders. It includes incomes that have had tax deducted at source – specifically, incomes that are paid or transferred through the EMS, and self-employment income reported through annual tax returns. In summary, the sources of income are:

  • wages and salaries paid to employees
  • self-employment
  • paid parental leave
  • student allowances
  • New Zealand Superannuation (including veterans’ pensions)
  • ACC payments
  • income-tested benefits.

ACC payments

Between 1 July 1999 and 30 June 2000, most new workplace claims were not identifiable in the LEED dataset. Over that period, employers were required to take out accident insurance cover with private insurers. Therefore, care must be taken when comparing LEED ACC payment statistics from this period with those from other periods.

ACC payments means all payments from ACC with tax deducted at source.

Income-tested benefits

The social assistance payments covered in LEED under 'income-tested benefits' are restricted to the taxable components of core welfare benefits that are granted on a needs basis. These include the base rate of the unemployment benefit, domestic purposes benefit, sickness benefit, invalid’s benefit, widow’s benefit and emergency benefit. Income-tested benefits in LEED do not include:

  • Non-taxable forms of supplementary assistance such as accommodation supplements, disability allowances, special needs grants, residential care subsidies, childcare payments, and special benefits. These are often paid in conjunction with core benefits and can form a significant part of social assistance income.
  • Tax transfer payments paid either by Inland Revenue or Work and Income. Work and Income pays some tax transfer payments, such as family support, directly to beneficiaries on behalf of Inland Revenue. Inland Revenue pays family support to non-beneficiary lowincome families and to some people with both benefit and employment earnings in the same tax year.

In LEED, income-tested benefits are recorded on an individual basis from the tax data. In comparison, the income support system is structured around payments to families. Together, these things mean that LEED benefit incomes will tend to be lower than total income support received. The sources of income recorded in this report cannot be considered a proxy for all forms of income transfers or government assistance.

Income-tested benefits are not a proxy for the number of unemployed. Although the unemployment benefit is covered in this income source, it also includes those receiving benefits that can imply a lesser attachment to the labour force (for example, the invalid’s, sickness, domestic purposes and widow’s benefits).

Statistics on transitions onto and off benefit can be disaggregated by benefit type.

Other sources of income not included in this report:

  • investment income
  • undeclared wages and salaries
  • income earned overseas.

It is also important to note that analysing income levels at the individual level does not take into account the impact of differing family compositions. LEED contains no information on family or household structure.

Self-employment in LEED

Definition of self-employment in annual statistics

A person with income from self-employment is an individual who operates their own economic enterprise or engages independently in a profession or trade, and receives earnings from their enterprise from which tax is deducted.

In theory, self-employed people are distinguished from paid employees according to the level of responsibility or economic risk and control that an individual assumes in the operation of their enterprise. Most or all of the following characteristics are indicative of self-employed persons: they are actively engaged in running their business, they control their own work environment, are responsible for getting the work done, and they make decisions on when, where and what hours they work, how much they get paid and when to take holidays. A person with a self-employed job invests their own money in their business and provides major assets and equipment for the job.

The distinction between self-employed and employee

Different types of self-employment cannot be identified with a high degree of accuracy in LEED. The distinction between a self-employed person and an employee is not always clear.

However, the distinction is usually clear in small companies, family companies, sole proprietorships, and partnerships, because the owner-manager assumes the risk for all losses and liabilities incurred by their firm, has decision-making rights or strong controlling interest, and remuneration is directly related to profits. It may not be clear for owner-managers of large
corporate companies or limited liability companies. Such people may be regarded as employees, although they also have similar characteristics to self-employed persons. In these cases, the owner-manager's level of financial risk and control is generally limited to the size of their shareholding, which is often not a controlling interest. They can be employed in a managerial position and remunerated by a salary or wages, akin to an employee, but they also receive a share of the profits as a shareholder.

Independent contractors

The distinction is also not clear for independent contractors. A lot of variation can exist in the degree of independence, which is generally determined by the contractual arrangements.

Franchisees

Franchisees are regarded as self-employed because they carry the financial risk of the business and own the plant and equipment, but their operational working conditions can be similar to those of employees. They may have certain types of contracts with franchisors, who own some of the means of production (land, buildings, machinery, trademarks, etc). The contracts specify, to a significant extent, how the business is operated, and require the payment of part of total sales.

Other workers

Other examples where a worker can be a self-employed person or a employee are:

  • company directors
  • commission-only salespeople
  • freelance workers
  • network marketers
  • labour-only contractors
  • people working from home.

The blurring of the boundary between being an employee and self-employment is an issue faced by all statistical agencies in the production of self-employment measures.

LEED covers three types of self-employment. These are individuals where:

  • self-employment earnings are the main income source during the tax year
  • self-employment is the sole source of earnings
  • self-employment is the source of any earnings.

Type 1 is the focus of the report and is used to define a 'self-employed individual'.

Person counts

‘Person counts’ is a continuous measure. Actual numbers of wage and salary earners may be higher than those from published quarterly job statistics. Quarterly jobs statistics represent a snapshot of the 15th of the middle month of the quarter, and do not include employees who were working outside this date. However, person counts in the annual statistics account for these workers because counts are over the tax year.

Definitions of measures

The following tables provide the definitions for each measure in the tables included in this report and also those available through Table Builder, LEED Annual tables.

Other necessary definitions are:

  • the ‘year’ is the tax year – April 1 to March 31
  • the ‘reference date’ is the 15th of the middle month of a quarter – February, May, August and November
  • the ‘employer’ is the geographical unit, except for the multiple job and most of the selfemployment measures
  • for the multiple job and self-employment measures ‘the employer’ is the enterprise or firm
  • an ‘employee job’ is a unique employer-employee pair
  • all income measures are before tax
  • all income reported through the EMS includes payments reported as lump sums to Inland Revenue
  • the ‘sources of income’ are earnings with PAYE deducted at source, self-employment, ACC payments, paid parental leave, student allowances, income-tested benefits and New Zealand Superannuation
  • a 'self-employed person' is an individual whose main earnings source in the tax year was self-employment
  • self-employed persons can be referred to as 'working proprietors' because they own or control a firm
  • a 'working proprietor' firm is one that is operated by at least one person whose main earnings source in the tax year was self-employment.
Part 1 – Sources of Income
 Measure  Definition  Scope
Source of taxable income

Count of people who have received each type of income

Median annual earnings from people whose main earnings source is wages and salaries or self-employment

People over the tax year
Source of taxable income by proportion of income from that source Count of people who have received each type of income, by proportion of total income from that source People over the tax year
Main source of taxable income by secondary sources Count of people and median annual income by their main source of income and their secondary source of income People over the tax year
Main earnings source by industry Count of people and median annual earnings People over the tax year

Note

  • Source of taxable income – median annual earnings is calculated from all jobs (ie, it is based on the sum of earnings from wages and salaries and self-employment for an individual having both these sources).
  • Main source of income by secondary sources – if a person has only one source of income, then this source is also the secondary source of income.
  • Main earnings source by industry – the industry code assigned to a worker corresponds to the industry that had most earnings for the individual in the tax year. Median earnings is from all of an individual’s jobs, not just from their main industry. It is from the sum of earnings from wages and salaries and self-employment if the individual has both of these sources.
    Part 2 – Income Transitions
     Measure  Definition  Scope
    Flows between main taxable income sources Count of people by main source of income in current year against main source of income five years ago People over either tax year
    Flows between taxable income deciles Count of people by annual taxable income decile in current year against annual taxable income decile five years ago. People over either tax year
    Flows between earnings deciles Count of people by annual earnings decile in current year against annual earnings decile five years ago People over either tax year

    Absent categories

    These measures compare individuals at two reference periods. Individuals may be present in one reference period and ‘absent’ in the other reference period. Included in the absent category would be:

    • people who have migrated
    • people who have turned 15-years old since the last period
    • people who have died since the last period.

    Deciles

    A ‘decile’ is one of 10 segments of a distribution that is divided into tenths. For example, the second-bottom decile of an income distribution includes those whose income is greater than the lowest 10 percent, but less than the highest 80 percent.

    Part 3 – Income Source Spells and Job Tenure 
     Measure  Definition  Scope
    Source of taxable income by months received

    Count of people by number of months in the year they received that income source

    People over the tax year
    Source of taxable income by continuous spell length

    Count of spells by length of spell for income spells that were continuing at 31 March

    Spells ongoing at the last day of the tax year
    Length of continuous job tenure

    Count and median monthly earnings of continuing jobs by length of job tenure

    Jobs ongoing at the last day of the tax year

     Note

    • Monthly data in LEED is the basis of statistics in part 3 of the LEED Annual tables.
    • Self-employment is excluded from part 3 because it is not available on a monthly basis.
    • Jobs refers to employee jobs.

    Definition of spells and tenure

    A ‘spell’ is a continuous period of receiving income. Job tenure it taken as the length of employment, in this case the number of months, with a given employer.

    The EMS tax data is received monthly by Statistics NZ. For each successive month of a spell, it is therefore known that the person received some income from that particular source. Similarly, for each successive month of job tenure, it is known that the person received some earnings from the same employer. This is not always equivalent to receiving these income sources
    continuously. Gaps can occur within these spells or job tenure – but each is ‘unbroken’ as long as some income is received in the month.

    The following examples are considered unbroken spells of income or job tenure:

    • an individual on an income-tested benefit that was discontinued in one month, but recommenced the following month
    • an individual who works for short periods (a day or even an hour) each month for the same employer.

    Retrospective payments may increase the length of spells or job tenure by extending the spell into the next month. For example, a benefit may end one month but the last payment occurs in the next month, or final payments (including holiday earnings) are paid in the month after employment ends. It should be noted that LEED uses EMS tax data to define the length of a spell – these payment months can be different to the period of qualification for an income source. For example, employment start and end months can be different to the first and final payment months.

    Imputation of employment

    For job tenure and earnings spells, some one-month periods of non-employment were imputed as periods of employment. This was done when one month of non-employment occurred between two periods of six successive months with the same employer. In this situation, the imputation is more reflective of the employment relationship.

    Length of spells and tenure beginning before May 1999

    Earnings spells and job tenures that began before May 1999 may range from one day to many years. For most of these spells it is known only that the person received a payment from that income source in April 1999 (the first period of the EMS). The ‘start date’ field in the EMS is often not completed.

    Part 4 – Multiple Job Holding
    Measure

    Definition

    Scope
    Number of jobs held and earnings

    Count of people, by the number of jobs held

    Median monthly earnings of people for each job held, by the number of jobs held

    People with at least one job on the 15th of the middle month of the quarter
    Workers with multiple jobs

    Count of people, by industry of first and second jobs

    Median monthly earnings of people, by industry of first and second jobs

    People with more than one employee job on the 15th of the middle month of the quarter

    Note

    • Monthly data in LEED is the basis of statistics in part 4 of the LEED Annual tables.
    • Self-employment is excluded from part 4 because it is not available on a monthly basis.
    • ‘Jobs’ refers to employee jobs.First and second employee jobs

    First and second employee jobs

    The first ‘employee job’ is the one in which the person had the highest earnings in the month. Similarly, the second employee job is the one where the person had the second-highest earnings in the month.

     Part 5 – Self-employment
     Measure  Definition Scope
    Main earnings source, by average firm size Counts and median annual earnings of persons whose main earnings source in tax year was wages and salaries or self-employment People over the tax year
    Workers with wages and salaries, and self-employment as the two main sources of taxable income Counts and median annual earnings of persons with wages and salaries People over the tax year
    Firms with employment

    Count of firms with and without working proprietors

    Count of self-employed jobs in firms with working proprietors

    Average quarterly number of employee jobs in firms with and without working proprietors

    Firms over the tax year

    Self-employed jobs over the tax year

    Average quarterly number of employee jobs in the year

    Note

    Main earnings source by average firm size:

    • A person is associated with only one firm. The firm with the highest annual earnings is used for those associated with more than one firm. For a person whose main earnings source was wages and salaries, the average firm size corresponds to a firm that employed them. For a person whose main earnings source was self-employment, the average firm size corresponds to a firm that they own and operate.

    Workers with wages and salaries, and self-employment as the two main sources of taxable income:

    • For workers in this group who have more than one employee job, the industry assigned  to wages and salaries is based on the industry with the highest earnings in the tax year. The same approach is used to assign industry to earnings from self-employment.

    Firms with employment:

    • A person can be associated with more than one firm. Therefore, a person who works for more than one firm will be counted more than once. A self-employed person who operates more than one firm in the tax year will be counted more than once.
    • A labour-only contractor is regarded as operating 'one firm'. Many of these people are reported through the EMS, and are counted more than once if they work for more than one firm in the tax year.
    • For a person with an employee job, the average firm size corresponds to the firm that they work for. For a person with a self-employed job, the average firm size corresponds to the firm that they own and operate.
    • The main statistic for this measure is count of firms. It would be understated if only one firm was associated with each person.
    • The employee job count in this measure excludes self-employed persons who were reported as employees in the LEED quarterly statistics. These people are included in the self-employed job count. Therefore, levels of employee jobs may differ from those in published LEED quarterly statistics.
    • The average quarterly number of employee jobs in the tax year is calculated from counts taken on the 15th of the middle month of the quarter.

    Dimensions

    LEED does not contain any information on ethnicity, occupation or qualifications.

    Age

    Age is taken at the beginning of the tax year (April 1). For the income source spells and job tenure tables, age is taken at the last day of the tax year. Age is derived from the date-of-birth variable in the tax data. About 4 percent of individuals have records missing a date of birth, which is therefore imputed. Imputed age for people with records created from annual tax returns is less robust because they have less auxiliary data. There is no way to impute a date of birth with a high degree of accuracy in these cases, but imputation can reduce the amount of bias in the estimates that is caused by missing values.

    Region

    Region is the regional council area where the person lives. For people with income reported in the EMS, region is the regional council area where the person has lived for most of the year. For the multiple employee job tables, region is determined at the 15th of the middle month of the quarter. For people with records created from annual returns, region is based on where the person lived at the start of the tax year.

    Industry coding for people with wages and salaries

    Industry is the Australian and New Zealand Standard Industrial Classification (ANZSIC) code of the main activity of the geographical unit (or the workplace) where the person worked. For the measure 'main earnings source by industry', the industry assigned to a person with more than one job is based on the industry in which the person had the highest earnings in the tax year. For the multiple job tables, industry is the ANZSIC code of the geographical unit where the person earned the most, or second-most, earnings in the month.

    Industry coding for self-employed people

    The industry for self-employed people is the main activity of a firm owned or controlled by them. For the measure 'main earnings source by average firm size', it is based on the industry with the highest earnings if the self-employed person owns and controls more than one firm in the tax year.

    Imputation of industry is common for self-employed people reported in the annual tax returns. Consequently, the industry coding is not as robust as that for people reported through the EMS. Each record in LEED has a 'payee-payer' relationship derived from tax data. The industry coding is imputed, with the payer's industry, for self-employed people reported in annual tax returns. In these cases, the payer is assumed to be a firm owned or controlled by the self-employed person (or the payee) if they are a non-contractor. Some self-employed people cannot be assigned an industry code because of insufficient information about the payer. In these cases, the industry coding is imputed, using the payee's occupation if it exists. About 5 percent of self-employed people do not have an industry code.

    Independent contractors are a special case of self-employment. The industry coding assigned to this type of worker is based on the payer with the highest earnings in the tax year. In the firm-level statistics, the industry coding for a firm owned or controlled by a contractor is based on the payee's industry code.

    ANZSIC96 and ANZSIC06

    Annual industry statistics from LEED relate to ANZSIC divisions. LEED currently publishes statistics for two versions of ANZSIC. ANZSIC96 is the 1996 version, while the latest is ANZSIC06 or ANZSIC 2006. This is the first LEED annual report to contain outputs for both ANZSIC96 and ANZSIC06. Industry outputs based on ANZSIC06 are available for the entire LEED annual backseries (to 2000). Note that outputs based on ANZSIC06 are not comparable with those defined using ANZSIC96.

    The introduction of ANZSIC06 followed a review that involved consultation with government agencies responsible for policy formulation and administration, non-government analysts of industry structure and performance, and industry experts. The changes ensure the classification is current and relevant, reflecting changes in the structure and composition of industry since the previous version, and recognising changing user requirements for industry data. ANZSIC06 is being moved progressively into Statistics NZ collections in the five years from 2006. More information can be found at Introducing ANZSIC 2006.

    The 2010 LEED annual release on 25 November 2011 will be the final release to update the ANZSIC96 Table Builder tables on the Statistics NZ website. Future releases will exclude these tables.

    Main source of income

    For the sources of income and income transitions tables, ‘main source of income’ is the one which gave the person the highest income in the tax year.

    Size of firm

    In the job tenure measures, ‘size of firm’ corresponds to the firm size on the last day of the tax year and is based on employee count.

    ‘Average firm size’ is used in the self-employment measures. It is defined as the average quarterly number of employees working for a firm during the tax year. The employee count is taken on the 15th of the middle month of the quarter.

    Rounding and cell suppression

    The figures in the tables have been rounded and discrepancies may occur between sums of components and totals. Median dollar figures in cells with a count of less than 25 are suppressed, for quality reasons.

    LEED improvements

    In the 2008 tax year, Inland Revenue supplied improved address information with new and updated postcodes.

    As a result of the better quality address information, previously imputed information was corrected and a considerable number of addresses were updated. This caused greater than normal numbers of people to change address locations, in particular territorial authority (TA) location, which was reflected in an increase in worker flow measures for the 2008 tax year. The level of TA changes after the 2008 postcode address updates have since fallen to levels consistent with previously published results.

    Timing

    Timing of measures

    The measures are annual, over the tax year (1 April to 31 March).

    Exceptions are:

    • the spells of employment and employee job tenure – these are taken over the whole of the time series (seven years for this report)
    • multiple job holding, which is measured at the 15th of the middle month of the quarter (February, May, August, November)
    • the 'firms with employment' measure, where the average quarterly number of employee jobs in the tax year is used. The average is calculated from counts taken on the 15th of the middle month of the quarter.

    The tax year was selected as the time period for many of the statistics in this report because the majority of self-employment data is on a tax-year basis.

    All annual measures will be produced on an ongoing basis. Reasons for this are:

    • these statistics are unlikely to vary much over the short term
    • many person-level statistics have traditionally been reported annually, for example in the ‘incomes of persons’ statistics from 1978 to 1999
    • to reduce the scope for confusion with the quarterly job-level data
    • most self-employment data is only available on an annual basis, due to characteristics of the source Inland Revenue data.

    Timeframe for production

    The timeliness of the annual statistics is dependent on a number of factors:

    • Employers take time to complete their EMS schedules and supply them to Inland Revenue.
    • At least a year is required to complete receipt and processing of annual tax returns.
    • Inland Revenue requires time for processing and supply to Statistics NZ.
    • Statistics NZ requires further time for receipt, data transformation and the production of output data.

    In addition, late returns and updates are received in LEED well after the end of the reference period. These can distort the measures produced, particularly the estimates of change.

    The annual statistics in this report are published around 20 months after the end of the reference tax year. A delay of this length ensures that further updates from Inland Revenue have little impact on the statistics.

    Time series

    Estimates for the most recent tax year are provisional (for one year) until the next release. (That is, they are revised and become final with the publication of the next annual release). This allows late annual self-employment returns to be processed. These returns are less timely than EMS returns. This means that while provisional figures for the other income sources will be very close to the final figures, the self-employment provisional numbers will be less than the final numbers.

    Comparisons with other Statistics NZ data

    The following tables compare information available from LEED with that available from other Statistics NZ sources.

    Statistics NZ data Income sources Income transitions Income spells and job tenure Multiple job holders Self-employment
    Household Labour Force Survey (HLFS) Not available Only gross flows about labour force transitions Not available Estimates are available Estimates are available
    Quarterly Employment Survey (QES) Only pre-tax wages and salaries for employee jobs Not available Not available Not available Only jobs of working proprietors with employees
    Survey of Family, Income and Employment (SoFIE) Before-tax personal annual income and average weekly earnings from all sources Transition over one-year period for people moving between different personal annual income deciles, and weekly employee earnings. Labour force involvement spells (ie, time spent in different labour force states). Not published Not published
    Household Economic Survey (HES) Before-tax personal annual income from all sources. Not available Not available Not available Estimates are available
    New Zealand Income Survey (NZIS) Before-tax average weekly income from all sources. Not available Not available Not available Estimates are available
     
    Statistics NZ data Main purpose of output Collection unit Statistical unit Type of collection Frequency Reference period Timeliness of publication
    SoFIE Measures factors that influence changes in circumstances of New Zealanders People People Sample survey Annual Year ended September After each 'wave' of interviews. Release date depends on wave survey topic
    HES Household income and expenditure statistics Households People and households Sample survey Every three years Year ended June Five months after end of reference year
    NZIS Statistics about pre-tax income Households People and households Sample survey Annual June quarter Four months after end of June quarter
    See Guide to Interpreting the LEED Data for details about HLFS and QES.
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