Understanding Alternative Employment Estimates for Kentucky Counties: Use in Community Analysis and Community Development
In conducting a community analysis, such as asset-based development or community economic analysis, employment data are a critical piece of information. Communities may wish to know what types of jobs exist, in what industries and how have those numbers changed over time. There exist a number of sources of employment for Kentucky counties. In some cases, one may find conflicting numbers on the number and type of jobs in a community. There are a number of reasons of these discrepancies including different data collection methods, different measures of employment and different time periods. This article will step through the different sources of employment data for Kentucky counties and suggest recommendations for appropriate data use.
The U.S. Bureau of Economic Analysis (www.bea.gov) and U.S. Bureau of Census (www.census.gov) both provide county level employment estimates. Employment data can be divided into two types: by place of residence and by place of work. The place of residence number adjusts for the fact that many people live in one county and work in another. In this case, persons who have a job somewhere (either in their county of residence or not) are counted as an employed person in their home county.
Place of work employment data is based on the actual number of jobs in a county. These jobs are measured regardless of where the person in the job resides. Some of these jobs may be taken by people whom do not reside in the county or even the state. Part-time jobs are aggregated and measured as full-time equivalent positions. Self-employed people are not counted in place of work jobs.
The Bureau of Economic Statistics has a dataset called Regional Economic Information System (REIS) (www.bea.gov/regional/reis). This is most comprehensive data source for county place of work and place of residence employment data. The place of work job figure is determined using state unemployment insurance data. It measures jobs by industry (agriculture, construction, manufacturing, transportation wholesale, retail, finance, services and government) using the U.S. Standard Industrial Code system (http://www.census.gov/epcd/www/sic.html) for the years 1969 through 2000 on an annual basis. The REIS system also measures self-employed persons using data from the Internal Revenue Service (IRS). The combination of place of work jobs and self-employed persons is called Total full-time and part-time employment by industry.
The Census Bureau has an employment dataset called County Business Patterns (http://www.census.gov/epcd/cbp/view/cbpview.html). This dataset also measures place of work jobs, but does not measure place of residence jobs. It is based on a survey of employees that takes place in early March of every year. The advantage of the County Business patterns data is that employment figures are provided for very detailed levels of industries. For example, employment by different types of manufacturers are presented in a county. Because it is based on a survey, County Business Patterns does not capture self-employed persons or place of residence employed persons data.
This article has reviewed two sources of county level employment data: U.S. Bureau of Economic Statistics REIS system and the U.S. Bureau of Census County Business Patterns data. Due to the different data collection methods, a county may appear to have different numbers of jobs. However, this is due to differences in what is being measured and at what level of detail. The REIS system is the most reliable and comprehensive employment data source, particularly for historical data. County Business Patterns is useful in understanding employment at very detailed level of industries (such as durable versus nondurable manufacturing), while REIS is confined to very aggregated industry levels such as construction or manufacturing.
Finally, an example may help clarify differences in datasets. In comparing Adair County manufacturing employment, one finds large discrepancies between REIS and County Business Patterns. REIS reports that Adair County had 628 manufacturing jobs by place of work in 2000. County Business Patterns reports only 361 jobs in Adair County by place of work in 2000. The discrepancy may due to the fact that employment picked up later in the year, while County Business Patterns only measured employment as of early March and REIS measures employment over the entire year. Further investigation would be required to understand the differences. The critical point is that employment must be used with caution and the source of the data must be checked and clarified when using it in community analysis and reports.
For More Information
For additional information please contact, Eric Scorsone or visit the Community Economic Analysis Website at http://www.uky.edu/Ag/CEA/ for additional information. .