Employment update: a work in progress

Inspired by infographics

Lying in bed this morning, browsing through my blog reader, I stumbled upon an infographic of the best-selling make and model of car in each US state. You see this type of infographic all the time, and they typically are attempting to argue that some kind of sub-national, regional patterns of cultural, social, and economic behavior exist. I enjoy these graphics, but they are generally not terribly scientific.

This gave me the idea to try to manufacture a map showing the largest sector by employment in each of the state. My hope was to be able to identify economic specializations, or perhaps even regional patterns. I was hoping there would be considerable differences. I visited the Quarterly Workforce Indicator (QWI) by the Census online (http://ledextract.ces.census.gov/) and for each state downloaded the first quarter 2012 employment at the 4-digit NAICS level, and then extracted the largest sector into a separate spreadsheet that would contain such information for all fifty states and the District of Columbia.

By the time I got to Colorado, I had to abandon my endeavor, or at least hit the brakes. The largest sector in the first six states was NAICS 6111–elementary and secondary schools. This sector was followed usually by NAICS 6221 (hospitals) or 7221 (full-service restaurants). This was not what I expected, although it seems intuitive now. Nonetheless, I think that in itself this is interesting. Oddly enough, even though I see them everyday, it never occurred to me that schools and hospitals would take up quite so much employment. Of course, the QWI, classifying employment according to NAICS, does not suggest anything about occupational structure, just the type of economic activity that those employed are engaged in. So, hospitals employ lots of people, but the NAICS cannot tell us what the division within hospitals looks like (doctors, nurses, administration, custodial, etc), just the number of workers in them.

As I wanted to identify differences between states and regional specializations, I returned to the QWI and selected only for private-sector employment. I also retreated to the three-digit NAICS level, sacrificing a layer of specialization. This, again, was mostly exploratory, so I just looked at the first five states. In the table below, I show the top five three-digit NAICS sectors by employment in these five states.

Alabama
NAICS Employment
Food service and drinking places 132267
Administrative and support services 94136
Professional services 93134
Ambulatory health care services 84443
General merchandise stores 62209
Alaska
NAICS Employment
Food services and drinking places 17779
Ambulatory health care services 16302
Professional services 14606
Hospitals 12020
General merchandise stores 10442
Arizona
NAICS Employment
Administrative support services 192147
Food services and drinking places 179828
Ambulatory health care services 138116
Professional services 122605
Hospitals 79049
Arkansas
NAICS Employment
Crop production 75732
Animal production 48223
Forestry and logging 46388
Fishing, hunting, and trapping 43540
Support activities for agriculture and forestry 42925
California
NAICS Employment
Professional services 1080843
Food services and drinking places 1044787
Administrative support services 829147
Ambulatory health care services 660011
Hospitals 383284

In all states except Arkansas, the largest (private) employers are generally the health care system, restaurants/bars, professional services and administration support, and merchandise stores. Arkansas (finally!) is quite different–all agricultural activities.

I think the next step for me is actually to return to something I did in my doctoral dissertation, which is to compile the sectoral employment data into an index that shows the divergence of a state’s employment profile from the average. That is, it indicates the extent to which the employment profile in an area diverges due to specialization in sectors. An index like that can summarize quite a bit of information, yet it is also vital to include what those specializations are as the index is incapable of revealing that. That will be the next step, which will be in a forthcoming post.

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