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Quarterly Workforce Indicators: Concepts and Construction

This workshop provides an overview of the concepts and construction of the LEHD infrastructure and processing for the Quarterly Workforce Indicators (QWI). It covers the underlying concepts, QWI measures, and the data used in LED products.

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Quarterly Workforce Indicators: Concepts and Construction

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  1. Quarterly Workforce Indicators:Concepts and Construction C2ER Training Workshop June 4, 2012 Stephen Tibbets LEHD Program US Census Bureau

  2. Underlying Concepts:Construction of the LEHD Infrastructure • Goals: • Understand concepts, basics of construction of LEHD infrastructure and processing • Understand QWI measures, how data is used in LED products

  3. Reference Materials • QWI 101 • Overview of terms and measures • http://lehd.did.census.gov/led/doc/QWI_101.pdf • QWI Cheatsheet • Reference for the structure of the public release QWI files • http://vrdc.cornell.edu/qwipu/QWI-cheatsheet.txt • QWI Comprehensive Index • Provides crosswalk between various naming conventions • Indicates how measures are used in online products • Comparison of employment definitions • CPS vs. QCEW vs. LED

  4. Additional References • The LEHD Infrastructure Files and the Creation of the Quarterly Workforce Indicators • Primary reference for LEHD methodology • Technical papers also available in the LEHD and CES working paper series on various topics • Resources on the VirtualRDC for the Quarterly Workforce Indicators, OnTheMap, and the LEHD Infrastructure File System

  5. Background: LEHD/LED • LEHD: Longitudinal Employer-Household Dynamics • Program at Census • Data infrastructure (restricted use) • LED: Local Employment Dynamics • Partnership between Census and States • States voluntarily submit quarterly data • Public use data products • QWI (QWI Online, Industry Focus) • LODES(OnTheMap)

  6. Unemployment Insurance (UI)Earnings Records • Core data input file of LEHD infrastructure • Collected for operation of state UI program • UI benefits are based on historical earnings • Report earnings for all covered jobs • Total quarterly earnings for each job • Firm identified by State UI Account number (referred to as SEIN) • Worker identified by Protected Identification Key (PIK - Census identifier based on SSN)

  7. Unemployment Insurance Coverage • Most private sector jobs covered • for-profit and not-for-profit classified together (as per QCEW standard) • State and local government also in system, though some reporting inconsistencies • Federal data not available • Data based on Office of Personnel Management under development • Self-employed not available • Data derived from tax records under development • Massachusetts data not available yet

  8. LEHD Processing:Merging Data Quarterly Census of Employment and Wages (QCEW) Firm and Establishment (Single/Multi-unit) Geography Industry Ownership Unemployment Insurance Wage Records Firm-Worker (most states) OR Establishment-Worker (Minnesota only) Earnings Job history UI Account Number (SEIN) PIK (encoded SSN) Federal EIN Census, Surveys, Other Administrative Records Demographics Place of Residence Business Dynamics Statistics (BDS) Firm age and size

  9. Basic Concepts and Definitions • Employer (SEIN - firm) • single Unemployment Insurance (UI) account in a given state’s UI wage reporting system • Workplace location (SEINUNIT - establishment) • Not available on UI earnings records, except for MN • Employee (PIK) • at least one employer reports earnings of at least one dollar of UI-covered earnings for an individual • Dates • Year and quarter • UI earnings records reported on a quarterly basis • Boundary between quarters is the employment reference date • Beginning (and sometimes end) of QWI time series vary between states • Earliest start in 1990

  10. Job: Definition • Job (PIK-SEIN-SEINUNIT) • coupling of specific individual with specific employer and location in a given year/quarter • An individual may have multiple jobs within a quarter • The “primary job” (job with greatest earnings) is not defined separately in QWI, though it does appear in OnTheMap • Thejob is the basic unit of analysis within the LEHD Infrastructure • National longitudinal job frame • Jobs are linked across years and quarters to develop measures

  11. QWI Measure Aggregation • Measures are calculated at the job level, referencing the full employment history of the individual • Measures are all built from linearly aggregable components • For averages, means are used, rather than medians • Jobs are aggregated to generate estimates of QWI measures at desired levels

  12. QWI Aggregation Levels: Establishment • Establishment level characteristics • Geography • State totals • County, Metro, Workforce Investment Board areas • Industry • All industries • NAICS Sectors, Sub-sectors (3-digit), Industry groups (4-digit) • Ownership • All (1-5) • Public + private, as available • Private-only (5) • All crossings of these characteristics reported

  13. QWI Aggregation Levels: Firm • Characteristics of the national level firm • Firm Age (years) • 0-1, 2-3, 4-5, 6-10, 11+ • Firm Size (employees) • 0-19, 20-49, 50-249, 250-499, 500+ • Private ownership (5) only • Reduced detail on geography/industry tabulations

  14. QWI Aggregation Levels: Employee1. Age/Sex • Employee level characteristics • Age (years) • 14-18, 19-21, 22-24, 25-34,35-44, 45-54, 55-64, 65-99 • Sex • Male, Female • Age categories from Workforce Investment Act (WIA)

  15. QWI Aggregation Levels: Employee2. Race/Ethnicity • Employee level characteristics • Race • White alone • African-American or Black alone • Asian or Pacific alone • Native Hawaiian or Other Pacific Islander alone • American Indian or Alaska Native alone • Two or More Races • Ethnicity • Hispanic or Latino • Not Hispanic or Latino • OMB categories

  16. QWI Aggregation Levels: Employee3. Education • Employee level characteristics • Education • Less than a High School Diploma • High School Diploma, No College • Some college or Associate’s Degree • Bachelor’s Degree or Above • Valid only for individuals age 25and up • Reflects person’s maximum education level • Crossed by Sex in QWI tabulations

  17. QWI Production Process:Key Stages

  18. QWI Measures • The QWI public use files contain a series of 30 measures • Employment • Stock and flow measures (individual) • Job creation/destruction (firm/establishment) • Earnings • Average earnings • Change in earnings • Periods of non-employment

  19. QWI Measures • Measures are reported for all of the aggregations listed in the earlier slides • A broader range of theoretical measures are defined in the technical papers, though many are not estimated in regular production • The entire time series is re-estimated in every data release • Data updates, modifications to algorithms, stochastic imputations may change historical data

  20. Employment History • Jobs are linked across years and quarters to develop an individual’s employment history with a firm • PIK-SEIN-SEINUNIT level • Some measures reference all jobs for individual • The reference quarter is noted at t • Earlier quarters are negative, later positive • For calculation of measures, • RED indicates positive earnings in quarter • BLACK indicates zero earnings in quarter • GREY indicates time period not referenced

  21. QWI Measures:Employment Stock

  22. Details: Jobs • See m and M on comprehensive index • This variable is turned on (m=1) for every wage record in a state’s UI system that reports earnings of at least $1 in t • This is a job for m (PIK-SEIN-SEINUNIT) • This is a count of all persons ever paid by an employer at a location • By itself, it is not comparable to any other job-based statistic in the US system • Captures many short-term jobs not picked up elsewhere • Released in QWI public use files as “EmpTotal” and labeled as “Employment reference quarter: Counts” • Not reported in QWI Online, Industry Focus

  23. Details: Employment – Beginning of Period • See b and B on comprehensive index • This variable is turned on whenever an individual has positive earnings in both the previous and current quarters • m=1 for last quarter (t-1) and this quarter (t) • b=1 means an individual was employed at a particular employer and location (PIK-SEIN-SEINUNIT) on the first calendar day of the quarter • B is the count of beginning of quarter employment for an employer location (SEIN-SEINUNIT) • This is the main employment measure used in QWI and OnTheMap

  24. Beginning of Period Employment • Will reference as “b” or “B” • lowercase b – job level • uppercase B – jobs aggregated to establishment or higher level • Primary measure of employment for QWI and OnTheMap • Defined when job is present in previous and current quarter • If earnings are received in consecutive quarters, individual is considered to be employed at firm on first day of the quarter • Conceptually and empirically similar to QCEW Month 1 employment (Mon1) • Precise definitions, data sources, and methodology result in differences

  25. Comparison ofEmployment Definitions • See Employment Definitions handout • Originally prepared by George Putnam at the Illinois Department of Employment Security • Compares household definitions (CPS) with employer-based definitions (QCEW) and UI wage-record-based definitions (QWI, OnTheMap, LED, generally) • Caveat: • The description of the “allocation” process under LED in this handout is a simplification of the multiple imputation process actually used. It should not be taken as definitive.

  26. Beginning of Period Employment:Use in LEHD Data Products • In QWI Online reported as “Total Employment” • In Industry Focus reported as “Employment” and used to calculate “Growth in Employment” • In QWI public use files reported as “Emp” and labeled as “Employment: Counts” • In OnTheMap reported as “All Jobs” or “All Private Jobs” in all reports

  27. Beginning of Period Employment: QWI-OnTheMap Comparison • In QWI, each job is counted separately, even if a worker has multiple jobs • In OnTheMap, the beginning-of-quarter employment variable for the second quarter (April 1 reference date) is further refined • Primary job: b=1 and (SEIN-SEINUNIT) were the largest source of wage earnings for the second quarter among all employers for a given individual • All jobs: b=1

  28. Details: Employment –End of Period • See e and E on comprehensive index • This variable is turned on whenever an individual has positive earnings in both the current and next quarters • m=1 for this quarter (t) and next quarter (t+1) • e=1 means an individual was employed at a particular employer and location (PIK-SEIN-SEINUNIT) on the last calendar day of the quarter • E is the count of end of quarter employment for an employer location (SEIN-SEINUNIT) • This variable is reported in only the QWI public use files, as EmpEnd.

  29. Details: Employment – Full Period • See f and F on comprehensive index • This variable is turned on whenever an individual has positive earnings in the last, current and next quarters • m=1 for last quarter (t-1), this quarter (t) and next quarter (t+1) • f=1 means an individual was employed at a particular employer and location (PIK-SEIN-SEINUNIT) throughout the current quarter • F is the count of full quarter employment for an employer location (SEIN-SEINUNIT) • This variable is reported in the QWI public use files as EmpS and on OnTheMap as “Employment, Stable Jobs”

  30. QWI Measures:Employment Stock

  31. Graphs of QWI Measures • Totals have been aggregated across all states • Weighted averages recalculated based on public data, where necessary • Source: QWI R2012Q1 (production quarter release) • 47 states represented (including DC) • LA, RI, VA skipped production • Massachusetts data not yet available • Data for 2006Q1-2011Q2, as available • Not all measures available in all quarters • For percentage change, symmetric calculation used • (Mt-Mt-4)/((Mt+Mt-4)/2) • References current quarter and same quarter in previous year • Private sector only

  32. QWI Estimates:Employment Measures

  33. QWI Estimates:Employment MeasuresYear-to-Year Percent Change

  34. QWI Measures:Earnings (Stock measures)

  35. QWI Measures:Earnings (Stock measures)

  36. Basic Concepts: Earnings • Point in time earnings • Defined for a reference group meeting a particular employment definition at a point in time (End-of-quarter employment) • Full-quarter earnings • Defined for a reference group of full-quarter employment (Full-quarter employment, Full-quarter hires, Full-quarter new hires, Full-quarter separations) • Average earnings based on wage record earnings for the indicated quarter divided by 3 (monthly estimate) • In graphics, dollar sign ($) indicates reference quarter for earnings

  37. Details: Earnings – End-of-Quarter • See Z_W2 on comprehensive index • Earnings in quarter t are accumulated into W2 whenever an individual has positive earnings in the current and next quarter • m=1 for this quarter (t) and next quarter (t+1) • Z_W2 is the average monthly earnings of end-of-quarter employees for an employer location (SEIN-SEINUNIT) • This variable is reported in the QWI public use files as “EarnEnd”

  38. Details: Earnings – Full Quarter • See Z_W3 on comprehensive index • Earnings in quarter t are accumulated into W3 whenever an individual has positive earnings in the last, current and next quarters m=1 for last quarter (t-1), this quarter (t) and next quarter (t+1) • Z_W3 is the average monthly earnings of full quarter employees for an employer location (SEIN-SEINUNIT) • This variable is reported in the QWI public use files as “EarnS”, on QWI Online as “Avg Monthly Earnings”, in Industry Focus as “Average monthly earnings for all workers” (and for growth), and on OnTheMap as “Average Monthly Earnings, Stable Jobs”

  39. Details: EarningsTotal Payroll • See w1 and W1 on comprehensive index • Earnings in quarter t are accumulated into W1 whenever an individual has positive earnings current quarter m=1 for this quarter (t) • W1 is the total quarterly earnings of employees for an employer location (SEIN-SEINUNIT) • This variable is reported in the QWI public use files as “Payroll”

  40. QWI Estimates:Average Monthly Earnings

  41. QWI Measures:Employment Flow

  42. QWI Measures:Employment Flows

  43. Job-Based Measures: Employment Flow and Earnings • Measures use longitudinal job history to identify changes in employment status • Average earnings are calculated for some full-quarter measures • Turnover is as a composite measure based on aggregates of flow measures

  44. Details: Employment Flows-Accessions • See a1 and A on comprehensive index • An accession (a1) is turned on whenever an individual has positive earnings in the current and not in the previous quarter m=0 for last quarter (t-1) and m=1 this quarter (t) • a1=1 means an individual was newly employed at a particular employer and location (PIK-SEIN-SEINUNIT) during the current quarter • A is the count of all accessions for an employer location (SEIN-SEINUNIT) • This variable is reported in the QWI public use files as HirA

  45. Details: Employment Flows-New Hires • See h1 and H on comprehensive index • A new hire (h1) is turned on whenever an individual has an accession, with no earnings from the employer during the previous four quarters m=0 for last four quarters (t-4 to t-1) and m=1 this quarter (t) • h1=1 means an individual was newly hired at a particular employer and location (PIK-SEIN-SEINUNIT) during the current quarter • H is the count of all new hires for an employer location (SEIN-SEINUNIT) • This variable is reported in the QWI public use files as “HirN” and on QWI Online as “New Hires”

  46. Details: Employment Flows-Recalls • See r1 and R on comprehensive index • A recall (r1) is turned on whenever an individual has an accession, and also received earnings from the employer during the earlier three quarters m=1 for at least one of quarters (t-4, t-3, t-2), m=0 for last quarter (t-1) and m=1 this quarter (t) • r1=1 means an individual was recalled at a particular employer and location (PIK-SEIN-SEINUNIT) during the current quarter • R is the count of all recalls for an employer location (SEIN-SEINUNIT) • This variable is reported in the QWI public use files as “HirR”

  47. Details: Employment Flows-Separations • See s1 and S on comprehensive index • A separation (s1) is turned on whenever an individual has no wage record in the next quarter but is present this quarter m=1 for current quarter (t) and m=0 next quarter (t+1) • s1=1 means an individual was separated at a particular employer and location (PIK-SEIN-SEINUNIT) during the current quarter • S is the count of all separations for an employer location (SEIN-SEINUNIT) • This variable is reported in the QWI public use files as “Sep,” and on QWI Online as “Separations”

  48. QWI Estimates:Accessions and Separations

  49. QWI Estimates:Accessions and SeparationsYear-to-Year Percent Change

  50. QWI Estimates:Accessions, Separations, and New Hires

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