Addressing the Absence of Hours Information in Linked Employer-Employee Data

The availability of tax-based payroll data has proved a blessing to labour and business economists wishing to understand workers, their jobs and their employers. Unfortunately, administrative data do not always include key variables of interest. In the case of New Zealand, linked employer-employee data do not include any information on hours worked. We implement a set of complementary methods to patch this gap, deriving an approximate measure of full-time equivalent labour input. In addition, and more specific to the New Zealand data environment, we describe a method for identifying working proprietors using annual tax-filed information, thus providing a more complete picture of total firm labour input