Cell Phone Usage Can Predict Unemployment Rates, MIT Researchers Find
When people lose jobs, data shows that their cell phone use declines, which can be correlated with other unemployment indicators, say the researchers.Unemployment rates are typically tracked through weekly jobless benefits claims and other indicators, but researchers at the Massachusetts Institute of Technology say they have found that cell phone usage can also be used as a method to refine and confirm the latest unemployment figures. A study co-authored by several researchers at the school found that the cell phone data "can provide rapid insight into employment levels, precisely because people's communications patterns change when they are not working," according to a June 15 announcement from MIT. Without a commute or a place to work, the researchers hypothesized, most people will make a higher portion of their calls from home, while also potentially making fewer mobile calls, which would show up in their mobile phone usage patterns. The phone data in the study was analyzed following the 2006 closure of an automotive plant in Europe that left about 1,100 workers unemployed in a town of roughly 15,000 people. To conduct the study, the researchers built an algorithm that analyzed anonymous phone-use patterns and then assigned a probability that someone has become unemployed, according to MIT. They then compared that data to eight quarters of unemployment data in 52 provinces of a European country to determine if their theory held up.
By scouring the mobile phone usage data of the former auto plant workers after the facility shut down, the researchers found that the laid-off workers made 51 percent fewer mobile calls compared with working residents, according to the study. In addition, mobile calls made by a newly unemployed worker to someone in the town where they had worked dropped by 5 percentage points, while the number of individual cell phone towers needed to transmit the calls of unemployed workers dropped by around 20 percent, the study concluded.