Understanding changes over time in workers' compensation claim rates using time series analytical techniques

OBJECTIVE: The objective of this study is to better understand the inter-temporal variation in workers' compensation claim rates using time series analytical techniques not commonly used in the occupational health and safety literature. We focus specifically on the role of unemployment rates in explaining claim rate variations. METHODS: The major components of workers' compensation claim rates are decomposed using data from a Canadian workers' compensation authority for the period 1991-2007. Several techniques are used to undertake the decomposition and assess key factors driving rates: (i) the multitaper spectral estimator, (ii) the harmonic F test, (iii) the Kalman smoother and (iv) ordinary least squares. RESULTS: The largest component of the periodic behaviour in workers' compensation claim rates is seasonal variation. Business cycle fluctuations in workers' compensation claim rates move inversely to unemployment rates. CONCLUSIONS: The analysis suggests that workers' compensation claim rates between 1991 and 2008 were driven by (in order of magnitude) a strong negative long term growth trend, periodic seasonal trends and business cycle fluctuations proxied by the Ontario unemployment rate.