Longitudinal Education Outcomes (LEO) from Scottish Colleges: 2016-2017

Annex C: Methodology

Background methodology:

Detailed information will be made available in a Methodology document alongside this release: https://www2.gov.scot/Topics/Statistics/Browse/Lifelong-learning

Additional detailed information on the LEO data is available in the Department for Education releases: https://www.gov.uk/government/collections/statistics-higher-education-graduate-employment-and-earnings

Further detailed information on college statistics in Scotland is available on the Scottish Funding Councils website: http://www.sfc.ac.uk/publications-statistics/publications-statistics.aspx

Suppression and rounding:

In line with disclosure control rules, information based on fewer than 11 individuals has been supressed. This aligns with our previous releases of LEO data. All earnings have been rounded to the nearest £100.

Data Quality:

Users should be aware of limitations around the data included in this publication;

Mode:

The employment data covers those with records submitted through the Pay As You Earn (PAYE) system and the Self-Assessed system. Neither systems collect information on the number of hours worked; therefore, whether an individual is working full-time or part-time cannot be ascertained. Work is ongoing to explore the opportunity to link the LEO data to the Annual Survey of Hours and Earnings (ASHE), which could allow for a subset of the LEO data to contain information on full-time and part-time work patterns.

Employment outcomes:

Outcomes are presented for completers that have been successfully matched to the Department for Work and Pensions' Customer Information System (CIS). In this publication these individuals are referred to as matched. Matched individuals are only included if they are in sustained employment. Individuals are considered to be in sustained employment if they were employed for at least one day for five out of six months between October and March of the tax year in question or if they had a self-employment record in that tax year.

Location of Work:

Earnings can vary greatly across different regions of the UK and Scotland. At present, the data cannot account for any regional variations. Two options to address this are being explored:

• To use the latest home address collected by DWP through their Customer Information System (CIS), which is updated whenever an individual notifies a change of address.
• To link LEO data to the Inter-Departmental Business Register (IDBR), which will allow for a subset of the LEO data to contain information on region and sector of employment.

Completion of College course:

This release only covers those who have successfully completed a full-time recognised qualification at a Scottish college in 2012/13. The SFC publishes a range of information on completion rates at college. The College Performance Indicators (CPI) publication is available here: http://www.sfc.ac.uk/publications-statistics/statistical-publications/statistics-schedule/statistical-publication-schedule.aspx

Further study at college or university:

To provide a complete LEO picture of college provision, work needs to be done to identify students who articulate from college or university. The Scottish Government and SFC will work together to identify these students and implement an appropriate methodology to estimate and compare median earnings across different college learner journeys. Further information on articulation is available from the Articulation from Scottish colleges to Scottish universities publication: http://www.sfc.ac.uk/publications-statistics/statistical-publications/statistics-schedule/statistical-publication-schedule.aspx

Time period:

The time period for which employment and earnings data is reported in this publication is three years year after completion. This refers to the full tax year three years after completion. So, for those who completed college in the 2012/13 academic year, employment and earnings outcomes relate to the 2016/17 tax year. Previous LEO releases in Scotland covering HEIs and Modern Apprenticeships have focused on a five years gap.

Career Path:

Different courses will lead to different career paths which could have greatly different earnings. Some individuals may change career entirely, and the employment they are in three years after completing college may not reflect the college course they completed.

Annualised earnings:

Earnings figures are only reported for those classified as being in sustained employment and where we have valid earnings record from the P14. A P14 is a tax return for an individual employee and must be completed by their employer. Earnings from self-assessment are not included in a P14.

For each individual, the earnings reported for them on the HMRC P14 data for a given tax year are divided by the number of days recorded in employment across that same tax year. The number of days recorded is the total number of days for which an individual was employed and not the number of days they have worked, meaning working patterns cannot be determined.

This provides an average daily wage that is then multiplied by the number of days in the tax year to calculate their annualised earnings. This calculation has been used to maintain consistency with previous LEO statistical releases and provides those who intend to go from college straight into work an indication of earnings they might receive once in sustained employment.

The annualised earnings calculated are slightly higher than the raw earnings reported in the tax year. This is because the earnings of those who did not work for the entire tax year will be higher when annualised. The difference between the annualised and raw figures decreases as time elapses after completion. Median annualised earnings three years after completion are around £400 higher than the median raw earnings.

All earnings presented are nominal. They represent the cash amount an individual was paid and are not adjusted for inflation (the general increase in the price of goods and services).

Total earnings:

Earnings in this release are presented as total earnings, which is the sum of the annualised PAYE earnings and raw self-assessment earnings. If an individual has earnings only through either PAYE or self-assessment, then their total earnings will be equal to their PAYE or self-assessment earnings. Total earnings figures are only reported for those in sustained employment through the PAYE or Self-Assessed systems.

Self-assessment earnings (SA):

Self-assessment earnings only include profits from partnership enterprises and profit from sole-trader enterprises. As the self-assessment data does not include any information on the number of days worked within a tax year, we make the assumption that the recorded earnings through self-assessment relate to the full tax year. This means that unlike the PAYE earnings, the SA earnings are not annualised.

Scottish Index of Multiple Deprivation (SIMD):

The SIMD ranks small areas (data zones) in Scotland from most deprived to least deprived. The SIMD overall rank is calculated from the individual ranks of seven domains: Income, Employment, Health, Education/skills, Housing, Geographic access, and Crime. The quintiles represent 5 equal-sized groups of the SIMD ranks, with quintile 1 representing the 20% most deprived areas, and quintile 5 representing the 20% least deprived areas.

We have used SIMD 2012 as this was the index that was available during the 2012/13 academic year which is used in this release.

Further detailed information on SIMD is available in the Scottish Government website: https://www2.gov.scot/Topics/Statistics/SIMD