Home Labor Market Information Methodology for Generating Industry Employment Data

Methodology for Generating Industry Employment Data

The employment by industry method is a nationally recognized system of reporting monthly employment. Employment by industry data reflect jobs by "place of work". That is, jobs located in the county or the Metropolitan Statistical Area (MSA) that pay wages and salaries are counted although workers may live outside the area. Jobs are counted regardless of the number of hours worked. Multiple jobholders (i.e., individuals who hold more than one job) may be counted more than once. Self-employed, unpaid family workers, and private household employees are not included. Industries are classified according to the North American Industry Classification System (NAICS).

Visit the North America Industry Classification System (NAICS) for more information.

Methodology

These data are based on the Current Employment Statistics (CES) survey. The CES survey summarizes monthly employment, hours, and earnings data from a sample of California employers. (This survey is also referred to as the establishment, payroll, or wage and salary employment survey). The estimates are revised in the following month as job information is received from additional employers.

Final revisions to the statewide and local area data, called a "Benchmark", are made each March for the current and previous year. These revisions are based on payroll tax reports submitted to the State by California employers covered by the Unemployment Insurance program.

The CES survey, like other sample surveys, is subject to two types of errors - sampling and non-sampling. The size of the sampling error, or variance, depends on the size of the sample and how much of the universe is covered in the survey. For more information and measurements of error, see "Reliability of State and Area Estimates" at the Bureau of Labor Statistics (BLS) website.

Annual average data are derived by adding up the monthly data for each industry and dividing by 12.

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Using the Data

The "Total, All Industries" employment number is not directly comparable to "Employment" that is shown under "Labor Force" on these and other data files. A complete description of the Methodology for Generating Labor Force Data is also available.

Data adjusted for seasonal changes are only available for California at the major industry level. Monthly job estimates for areas below the state level are not adjusted for seasonal changes in employment. Month-to-month changes may be due to regular seasonal patterns in an industry. For example, during the holiday shopping season, retail jobs will typically show an increase, while the construction industry generally shows more growth during the summer. On the other hand, growth or decline may be due to new businesses, expansions, or closings that are not related to seasonal patterns. Therefore, comparison of monthly changes for the same period in prior years will provide a better understanding of whether the change is seasonal or atypical.

Monthly fluctuations in the wage and salary employment data are an essential part of the changes that occur in a dynamic economy of the county or region. It is important to study the data over time to evaluate the strength of the local economy.

Annual average data, over time, tend to be a better indicator of employment trends for the various industries in an area. Data may reflect major business openings, expansions, and closings. Or, these data may reflect trends affecting an entire industry, such as economic conditions and structural or technological changes.

Wage and salary employment data identify which industries have the largest number of jobs. It is important to note, however, that an industry with a large number of workers may not necessarily be expanding. It may, in fact, be downsizing. While new and expanding industries may not have large numbers of existing jobs, they may be a good source for new job opportunities.

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Data Users

Industry Employment data is used by Economic developers, firms considering relocation, government agencies, grant writers, universities, and anyone preparing reports on employment use wage and salary employment information to identify local industry trends. Job seekers, career counselors, or placement agencies/entities may learn about prospects for employment in various industries. Anyone seeking background information may use the wage and salary industry employment tables to look at the county's economy as a whole, at one industry, and/or at related industries for a firm's suppliers or for potential markets.

Visit the Current Employment Statistics(CES) from the Bureau of Labor Statistics for more information.

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