There is a growing demand in Great Britain for accurate economic and social information at sub-regional levels. This comes from the needs of both national and local government to target resources at areas which need them most. One of the foremost indicators of the health of an area is the unemployment rate. Traditionally, estimates of unemployment have been calculated direct from survey samples. However, whilst survey estimates of unemployment are acceptable for large government office regions, they are too unreliable to be published for over 80% of local authority areas.

To achieve more reliable estimates, the Office for National Statistics has developed a model-based approach to estimating unemployment for these smaller areas. Using this approach we have calculated estimates which are reliable enough to be published for nearly 100% of areas.

This paper will focus on our processes - including the validation procedures and plans for publication - as much as the model, or the estimates themselves. Thus we hope not only to give an introduction to small area estimation methods, but also the steps the Office for National Statistics takes in tackling a project such as this.