Technical brief

Alternative Data Sources for Labour Market Diagnostics and Policy Response: Applications in the COVID-19 era and beyond

This brief explores the opportunities and challenges posed by non-conventional data sources, offering policy makers a resource in how to improve employment diagnostics and resultant policy response.

While the broad impacts of the COVID-19 crisis on workers are generally understood, policy makers have struggled with capturing the labour market impacts of the pandemic in a way that allows them to rapidly develop and implement a policy response that is effective and targeted to the needs of the most vulnerable. Accurately identifying labour market impacts, an essential first step in developing national employment policies, has been difficult both because of the unprecedented nature of the shock and the difficulty of fielding traditional face-to-face household labour force surveys during the pandemic.

This information deficit underlines the need for national statistics agencies and policy makers more broadly to invest in developing supplementary data sources that can help them estimate essential labour market indicators when labour force surveys cannot be fielded or when they do not capture the effects of economic shocks in a timely manner. These non-conventional data sources include administrative data, existing economic indicators, dedicated surveys, and Big Data. Moreover, policy makers, employment specialists, and social partners can use these resources to expand their understanding of labour market dynamics and better inform labour market policy decisions, whether in times of crisis or not. This brief explores the opportunities and challenges posed by non-conventional sources, offering policy makers a resource in how to improve employment diagnostics and resultant policy response.