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EU-TTWA method

Labour market areas (LMAs) are sub-regional geographical areas where the bulk of the labour force lives and works, and where establishments can find the main part of the labour force necessary to occupy the offered jobs.

Why they are relevant
LMAs have long being recognised as meaningful zonal entities designed to have an explicit validity that is relevant to release information and statistics on employment and socio-economic structures, as well as for assessing the effectiveness of regional policy decisions and local government reorganisation. This alternative approach to territorial breakdowns is gaining in importance for analytical purposes and the demand for such data on the part of policy-makers is increasing.

LMA in Italy
Istat has released LMAs since 1989 based on the commuting data stemming from the 1981 population census. Similar exercises have been replicated for the 1991 and 2001 census. In December 2014 Istat has released LMAs (Istat, 2014) based on 2011 commuting data and the TTWA method stemming from Coombes and Bond (2007). Istat has been working on such method together with Eurostat and members of the Task Force on Harmonised LMAs.

The Grant
In December 2015 Istat has been awarded a grant by Eurostat with the aim of making available methodologies and tools to facilitate the development of LMAs among European Union countries.
The main aims of the grant are:

  • to systematise and improve the methodological work done so far within Eurostat Task Force on the TTWA algorithm and make it available to all MSs;
  • to improve the script produced so far to create an efficient tool for LMA development coupled with its documentation to be distributed freely;
  • to foster knowledge transfer and exchange by cooperation with other Member States on the creation of LMA and on ways to use this statistical geography;
  • to develop guidelines on LMA development.

The grant will finish in June 2017.
For further information please contact:

Initiatives: Workshop and training

Istat, together with institutes in Europe, has organised workshops in the area of LMAs. A training course has also been organised at Istat. These initiatives have the aim of sharing experiences and knowledge in this field, providing the opportunity to build together an harmonised geography, writing common guidelines for the production of LMA. A CROS portal page has been created: all the slides and the material presented in these occasions can be downloaded from the corresponding links presented below:

Code for LMAs development

Istat has released a new version of the dedicated R package to develop Labour Market Areas, LabourMarketAreas v. 3.0, which is available on Cran . Besides providing tools for the whole process of LMA production (implementation of the algorithm of regionalisation, visualisation of the geography, automatic fine tuning based on spatial contiguity and cohesion, analyses of results for parameters selection and assignment of names) the new version is more efficient and allows for community identifier in character form.

Istat also releases slides on How to use the package (published on 18.07.2016)

The implemented algorithm

Istat releases the first version of the technical description of the algorithm implemented in the package LabourMarketAreas (published on 13.06.16)

Industrial Districts identification

Istat defines Industrial Districts (IDs) as manufacturing LMAs based on micro, small and medium sized enterprises, featured by specialization manufacturing industries, and where the majority of employment is absorbed by the specialization industry of the LMA. The mapping methodology is based on the application of location quotient (LQ) within a hierarchical procedure. Such procedure makes use of Employment data classified on the basis of structural variables (economic activity and enterprise size class) calculated by LMA.

Istat releases the SAS and R scripts to identify and visualize results, as well as slides on How to use the SAS program.

Italian Labour Market Areas