These definitions supplement those provided in each chapter. They are a summary of definitions provided by the leading sources used. Background
The Human Development Index (HDI) is a summary measure of human development. It measures the average achievements in three basic dimensions: a long and healthy life, as measured by life expectancy at birth; knowledge, as measured by the adult literacy rate; a decent standard of living, as measured by GDP per capita. Life expectancy at birth is the average number of years that a newborn infant would live under the prevailing conditions of mortality. Gross Domestic Product (GDP) is the aggregate measure of production equal to the sum of the gross values added of all resident institutional units engaged in production. Who?
Employment includes persons aged 15 years and over, who during the reference period did any work for pay, profit or family gain for at least one hour, or were temporarily absent from their jobs. It includes employees and self-employed persons. Employees are persons who work for a private or public employer, have a contract of employment and receive compensation in the form of wages, salaries, fees, gratuities, piecework pay or remuneration in kind. Self-employed persons are the sole owners, or joint owners, of the unincorporated enterprises in which they work. They also include unpaid family workers, outworkers and workers engaged in production undertaken entirely for their own final consumption or own capital formation. Unemployed persons are those who were without work, actively seeking employment and currently available to start work during the reference period. The unemployment rate is the percentage of unemployed persons in the labour force.
Education level is based on the International Standard Classification of Education (ISCED) set up by Unesco.
• Less than secondary covers ISCED levels 1 & 2, primary and lower secondary education, usually compulsory.
• Upper secondary covers ISCED levels 3 & 4 and begins at the end of compulsory education. The entrance age is typically 15 or 16 years for a duration of two to five years. Qualifications and entry requirements are usually needed.
• Tertiary covers levels 5 & 6 and requires the successful completion of secondary education. It includes programmes with an academic or occupation orientation. Continuing Vocational Training (CVT) covers training measures or activities financed wholly or partly by enterprises for employees with employment contracts. Direct costs of CVT courses include fees and payments to external providers, travel expenses, labour costs of internal training staff, costs of premises. The Purchasing Power Standard (PPS) is an artificial currency unit that eliminates the differences in price levels between countries allowing meaningful volume comparisons. One PPS can buy the same amount of goods and services in each country. Where?
Industry sectors are based on the Classification of Economic Activities in the European Community NACE Rev 1:
- agriculture, sections A and B,
- industry, sections C to F,
- market services, sections G to K,
- non market services, sections L to Q.
Non market services are those provided free or at prices not economically significant and cover public administration, education, health, and social services.
| A foreign affiliate is an enterprise in which an investor, who is resident in another economy, owns a stake that permits a lasting interest in the management of that enterprise. The transnationality index is the average of four values: FDI (Foreign Direct Investment) inflows as a % of gross fixed capital formation for the past three years; FDI inward stock and value added of foreign affiliates as a % of GDP; and employment of foreign affiliates as a % of total employment. How long?
Working time, expressed in average annual hours actually worked per person, is the total number of hours worked over the year divided by the average number of people in employment. It covers full and part time employment. Actual working time includes hours actually worked by employees, taking into account overtime as well as paid leave. The average exit age is the average age at which active persons definitively withdraw from the labour market. How much?
Labour cost covers wage and non-wage costs less subsidies. Wage and salary costs includes direct remunerations, bonuses and allowances paid by an employer in cash or in kind to an employee in return for work done, payments to employee saving schemes, payments for days not worked and remunerations in kind such as food, drink, fuel, company cars, etc. Non-wage costs include employers’ social contributions plus employment taxes. Hourly labour costs show the total cost for employers on an hourly basis. Gross earnings are remuneration in cash paid directly to the employee before any deductions for income tax and social security contributions paid by the employee. Labour productivity is the value added per employee divided by the average number of employees during the year converted into full-time equivalents. Minimum wages are enforced by law and apply nationwide to full-time employees in each country. They are gross amounts, i.e., before the deduction of income tax and social security contributions which vary between countries. Social protection expenditure includes all interventions from public or private bodies intended to relieve households and individuals of the burden of a defined set of risks or needs fixed by convention as follows:
1) Sickness/Health care,
2) Disability,
3) Old age,
4) Survivors,
5) Family/children,
6) Unemployment,
7) Housing,
8) Social exclusion not elsewhere classified. Expenditure includes social benefits, administration costs, transfers to other schemes and other expenditure. Social contributions are the costs incurred by employers on behalf of their employees or by protected persons (employees, self-employed, pensioners) to secure entitlement to social benefits. Social security contributions are compulsory social security contributions paid by employees and employers to general government or to social security funds. |