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Household formation trends: evidence informing the DCLG 2011-based projections

Tim Lyne, Experian

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The DCLG household projections – summary of the approach

What the data available at the time of producing the projections told us about household formation

What evidence is there from current data?

Some key factors that we might want to consider for future updates to the projections

Overview

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The DCLG household projections are produced using a two-stage approach.

Stage 1 produces projections using long-term trends in household formation by age, gender and marital status drawing data from 1971, 1981, 1991, 2001 and (limited) 2011 Censuses.

The projections methodology uses time-series modelling which weights together simple and dampened logistics trends.

The assumptions about household formation are applied to trend-based projections of household population derived from ONS data.

► Assumptions about institutional population

► Marital status projections

Stage 2 splits the aggregate household projections from Stage 1 into household types using information from 2001 and 2011 Censuses.

► Estimated headship (and non-headship) rates are projected forward using a modified two-point exponential model - similar to the methodology used in other home countries.

DCLG household projections - approach

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For the update key datasets include:

► 2011-interim sub-national population projections

► Census 2011 key statistics and quick statistics

► Labour Force Survey data

Approach agreed with DCLG and Steering Group was to remain as methodologically consistent with the 2008-based projections as possible whilst making the most of the new data available.

DCLG 2011-based household projectionsData inputs and rationale

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Census 2011 households vs 2008-based projectionsHouseholds - England

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Census 2011 households vs 2008-based projectionsAdult household population - England

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Census 2011 households vs 2008-based projectionsAverage household size - England

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Census 2011 households vs 2008-based projectionsAverage household size – Greater London

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At the time of producing the 2011-based household projections Census 2011 data on households by age, gender and marital status was not available

The Stage 1 methodology used Labour Force Survey data to inform how household formation has changed by age band since the Census 2001

LFS data supported anecdotal evidence that household formation rates for younger age groups had increased more slowly than previously projected or declined more rapidly than previously projected.

Household formation by age

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Household formation by ageChange in HRRs by age between 2001 and 2011

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What does this mean for projections of AHS?

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Average household size UK - LFS

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Phase 2 splits the household projections from Phase 1 into detailed household types.

The projections are split by type and age (and gender for one person households) generated using headship rates generated from bespoke Census tables of which equivalents were not yet available for 2011.

Estimates for the each household type were generated from available Census 2011 data – largely for the totals for each household type not split by age.

Disaggregated using previous estimates for 2011 calibrated to 2011 household population data by age and gender.

Household formation by household type

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Stage 2 household typesProjected growth and the Census 2011

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Stage 2 household types (2)Projected growth and the Census 2011

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Discontinuity of the definition of households and household representatives in the Censuses

► 1971-1991 HRP=oldest male

► 2001-2011 HRP=oldest economically active person

Marital status projections – latest available 2008-based for England and Wales

Should the Labour Force Survey be given greater weighting?

► Greater weight given to household formation by age in Stage 1

► Explore whether LFS data could be used for Stage 2

Whether there are other sources of data that can reliably inform the household projections:

► Council tax statistics

► Housing stock - housing starts/ completions

The future of the Census – Beyond 2011…

Updating the household projections – points to consider

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The 2011 household projections used the best information available at the time.

Household formation slowed dramatically between 2001 and 2011 but this was not uniform across age groups and household types.

The trends captured in the 2011-household projections appear to have been played out in more detailed results from Census 2011.

Perhaps supports greater reliance on Labour Force Survey and possibly other data sources going forward?

Summary

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