Home Labor Market Information QCEW - About the Data

Quarterly Census of Employment and Wages
(QCEW - About the Data)

Introduction
The Quarterly Census of Employment and Wages Program (QCEW), formerly known as the ES-202 program, is a cooperative program involving the Bureau of Labor Statistics (BLS) of the U.S. Department of Labor and the State of California's Employment Development Department's (EDD) Labor Market Information Division (LMID). The QCEW program produces a comprehensive tabulation of employment and wage information for workers covered by California Unemployment Insurance (UI) laws and Federal workers covered by the Unemployment Compensation for Federal Employees (UCFE) program.

The QCEW program serves as a near census of monthly employment and quarterly wage information by 6-digit NAICS industry at the National, State, and County levels. At the National level, the QCEW program publishes employment and wage data for nearly every NAICS industry. At the State and local area level, the QCEW program publishes employment and wage data down to the 6-digit NAICS industry level, if disclosure restrictions are met. In accordance with BLS policy, data provided to the Bureau in confidence are not published and are used only for specified statistical purposes. BLS withholds publication of UI-covered employment and wage data for any industry level when necessary to protect the identity of cooperating employers.

Data from the QCEW program serve as an important input to many BLS programs. The QCEW data are used as the benchmark source for employment by the Current Employment Statistics program and the Occupational Employment Statistics program. The UI administrative records collected under the QCEW program serve as a sampling frame for BLS establishment surveys.

In addition, data from the QCEW program serves as an input to other Federal and State programs. The Bureau of Economic Analysis (BEA) of the Department of Commerce uses QCEW data as the base for developing the wage and salary component of personal income. The Employment and Training Administration (ETA) of the Department of Labor and the State of California's EDD use QCEW data to administer the employment security program. The QCEW data accurately reflect the extent of coverage of the State of California UI laws and are used to measure UI revenues; National, State and local area employment; and total and UI taxable wage trends.

BLS publishes data from the QCEW program every quarter in the County Employment and Wages press release. This is usually released 6 to 7 months after the end of the quarter. The QCEW program also publishes a subset of its quarterly data through the Create Customized Tables system, and full quarterly industry detail data at all geographic levels.

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Characteristics of the Data
These data are compiled as part of the operation of the Quarterly Census of Employment and Wages (QCEW) program. The data are derived from the quarterly tax reports submitted to the Employment Development Department (EDD) by California employers subject to State Unemployment Insurance (UI) laws and from Federal agencies subject to the Unemployment Compensation for Federal Employees (UCFE) program. Each quarter, EDD edits and processes the data and sends the information to the Bureau of Labor Statistics (BLS) in Washington, DC.

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Industrial Classification
Employment and wage data under the QCEW program have been classified by industry since 1938. An industrial code is assigned to each establishment by the State agency, based on a description provided by the employer on an Initial registration form (DE 1) filed with the EDD. If a private or government employer conducts different activities at various establishments or installations, separate industrial codes are assigned, to the extent possible, to each establishment.

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North American Industry Classification System (NAICS)
After 60 years of use, the outdated Standard Industrial Classification (SIC) system was retired and replaced by the new North American Industry Classification System (NAICS). NAICS is the product of a collaborative effort between the United States, Canada, and Mexico. Sharing a common classification system between these three countries allows, for the first time ever, direct comparison of economic data across borders in North America.

NAICS uses a production-oriented approach to categorize economic units. Units with similar production processes are classified in the same industry. NAICS focuses on how products and services are created, as opposed to the SIC focus on what is produced. This approach yields significantly different industry groupings than those produced by the SIC approach. Under the old SIC system, these units were spread across the manufacturing, communications, business services, and amusement services groups. The NAICS is updated every ten years with the newest revision occurring in November of 2007.

For more information about NAICS.

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Verification of Account Information
To ensure the highest possible quality of data, EDD verifies and updates, as necessary, the NAICS, physical location address, and ownership codes of all establishments on a three-year cycle known as the Annual Refile Survey (ARS). Each year, changes in establishment classification codes resulting from the verification process are introduced with the data reported for the first quarter.

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How to Request a NAICS Code Change
The Employer Classification Unit at LMID is responsible for assigning and reviewing NAICS codes. In the event an employer does not agree with our coding determination or has not received an assigned NAICS code, they can request an update by writing a letter on their company letterhead. The individual who signs the letter must be authorized agent of the employer.

The following information must be included in the letter:

  • State Unemployment Insurance account number (SEIN #).
  • Physical business address if it differs from the mailing address.
  • A brief statement asking for a review of your business activities and to change the assigned NAICS code or issue a newly assigned NAICS code.
  • A detailed description of the business activity and services or products provided.
  • A contact person and their phone number in the event we have additional questions.

We will review your request, make any necessary changes, and follow-up with you in writing within 10 working days. For your business purposes, all updated or newly assigned NAICS codes can be used immediately.

Please fax your written request to (916) 262-2350.

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Employment
Employment data under the Quarterly Census of Employment and Wage (QCEW) program represents the number of covered workers who worked during, or received pay for, the pay period including the 12th of the month. Excluded are members of the armed forces, the self-employed, proprietors, domestic workers, unpaid family workers, and railroad workers covered by the railroad Unemployment Insurance system. Wages represent total compensation paid during the calendar quarter, regardless of when services were performed. Included in wages is pay for vacation and other paid leave, bonuses, stock options, tips, the cash value of meals and lodging.

Workers on the payroll of more than one firm during the period are counted by each UI subject employer if they meet the employment definition noted above. Workers are counted even though, in the latter months of the year, their wages may not be subject to unemployment insurance tax. The employment count excludes workers who earned no wages during the entire applicable pay period because of work stoppages, temporary layoffs, illness, or unpaid vacations.

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Establishments
An establishment is an economic unit, such as a farm, mine, factory, or store that produces goods or provides services. It is typically at a single physical location address and engaged in one, or predominantly one, type of economic activity for which a single industrial classification may be applied. Occasionally, a single physical location address encompasses two or more distinct and significant activities. Each activity should be reported as a separate establishment if separate records are kept and the various activities are classified under different North American Industry Classification System (NAICS) codes.

Most employers have only one establishment; thus, the establishment is the predominant reporting unit or statistical entity for reporting employment and wages data. Employers who operate more than one establishment in California must file a Multiple Worksite Report (MWR) each quarter, in addition to their quarterly UI report. The MWR form is used to collect separate employment and wage data for each of the employer's establishments, which are not detailed on the UI report. When the total employment in an employer's secondary establishments (all establishments other than the largest) is 10 or more, the employer must file the MWR.

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Wages
All employers covered under the California Unemployment Insurance (UI) laws must report to the Employment Development Department (EDD) their quarterly wages using the DE 6 form. These wages are then used to populate the QCEW database. Wages are reported under the two following definitions.

Total Wages - Covered employers report total compensation paid during the calendar quarter, regardless of when the services were performed. Under California UI laws, wages include bonuses, stock options, the cash value of meals and lodging, tips and other gratuities. Employer contributions like certain deferred compensation plans such as 401(k) plans may also be included as wages paid.

Covered employer contributions for old-age, survivors, and Disability Insurance (OASDI), health insurance, Unemployment Insurance, Workers' Compensation, and private pension and welfare funds are not reported as wages. Employee contributions for the same purposes, however, as well as money withheld for income taxes, union dues, and so forth, are reported even though they are deducted from the worker's gross pay.

Wages of covered Federal workers represents the gross amount of all payrolls for all pay periods ending within the quarter. This includes cash allowances, the cash equivalent of any type of remuneration, severance pay, withholding taxes, and retirement deductions. Federal employee remuneration generally covers the same types of services as for workers in private industry.

Average Annual Wages - Average annual wages per employee for any given industry are computed by dividing total annual wages by annual average employment. Annual pay data only approximate annual earnings because an individual may not be employed by the same employer all year or may work for more than one employer at a time. Average annual pay is affected by the ratio of full-time to part-time workers as well as the number of individuals in high-paying and low-paying occupations. When comparing average pay levels between geographic area and industries, these factors should be taken into consideration. For example, industries characterized by high proportions of part-time workers will show average wage levels appreciably less than the pay levels of regular full-time employees in these industries. The opposite effect characterizes industries with low proportions of part-time workers, or industries that typically schedule heavy weekend and overtime work. Average wage data also may be influenced by work stoppages, labor turnover, retroactive payments, seasonal factors, bonus payments, and so on.

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Disclosure Restrictions
In accordance with policy, data provided to the QCEW in confidence are only published as allowed by law and are used only for specified statistical purposes and other purposes under California UI laws. EDD withholds publication of UI-covered employment and wage data for any industry level when necessary to protect the identity of cooperating employers.

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Imputed Data
To reduce the effect of data excluded because of late reporting by covered private and government employers, the Employment Development Department (EDD) imputes employment and wages for such employers and includes them in each quarterly report. Corrections to data that may be entered after a report is filed will include replacement of imputations with reported data to the extent possible. Imputations are calculated at the individual establishment level, normally using historical data reported by the employer. If a report remains delinquent for more than one quarter and Research shows that it is still active, the establishment will again be imputed.

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Comparison of ES202 Covered Employment Data With Other Series:
The Quarterly Census of Employment and Wage (QCEW) data ARE NOT the official estimates from the Employment Development Department. The official series is available through the Current Employment Statistics program on this website at Employment by Industry Data.

Differences between the QCEW and the CES include:

  • The QCEW data includes employers and their employees covered under the Unemployment Insurance programs, while the CES program makes an effort to estimate for all employment.
  • In the QCEW, Logging (NAICS 113310) is under the major industry, "Agriculture, Forestry, Fishing and Hunting". However, in the official estimates of employment by industry, they are included in the major industry, "Natural Resources and Mining" rather than "Agriculture".
  • The CES program and the QCEW program treat private households differently. In the CES program, private household workers are estimated as "non-covered" and as such are not shown by NAICS. In the QCEW, NAICS 814110 is provided.

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Uses of the Data
The Quarterly Census of Employment and Wages (QCEW) data are the most complete universe of monthly employment and quarterly wage information by detailed industry at the national, State, CMSA, MSA, and county levels. They have broad economic significance in evaluating labor market trends and major industry developments, in time series analyses, and in making industry comparisons.

The Bureau of Economic Analysis (BEA) of the Department of Commerce uses QCEW data as a base for developing the wage and salary component of personal income. This measure and other applications of QCEW data are widely used in determining Federal allocation of program grants to State and local governments.

QCEW data are used by businesses and by public and private research organizations as one of the best sources of detailed employment and wage statistics for economic forecasting, industry and regional analysis, impact studies, and other uses.

The program provides data necessary to both the Employment and Training Administration (ETA) of the U.S. Department of Labor and EDD to administer the employment security program. The information is used as an input for actuarial studies, determination of employer UI tax experience ratings, and UI benefit levels. Research using QCEW data helps ensure the solvency of the Unemployment Insurance trust funds. The QCEW data also are used to compute State and National insured unemployment rates for workers covered by UI programs.

The QCEW data also are important for a variety of other BLS programs. The Unemployment Insurance Address File, created from QCEW administrative records of UI-covered employers, serves as a sampling frame for BLS establishment-based surveys such as the National Compensation Survey, the Current Employment Statistics program, and the Occupational Employment Statistics Survey. The data also serve, for example, as the basic source of benchmark information for employment by industry and by size of establishment in the Current Employment Statistics program, the Occupational Safety and Health Statistics Survey, and the Occupational Employment Statistics Survey.

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Custom Tabulations and Confidential Data Requests
When the published Employment by Industry data does not provide the needed industry or geographic detail, customers can contact the Labor Market Information Division (LMID) to request a custom tabulation for detailed geographic areas for economic development and local labor market research. The source for these custom data tabulations is the Applied Research Group of LMID. For more information, see Custom Tabulations and Confidential Data Requests.

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