Business Employment Dynamics David M. Talan Branch Chief, Quarterly Census of Employment and Wages (QCEW) Program The Council for Community and Economic Research (C2ER) 52 ND Annual Conference Oklahoma City, Oklahoma Thursday June 7, 2012

Outline Background Quarterly Census of Employment Wages (QCEW) Data Business Employment Dynamics (BED) Data

Quarterly Census of Employment and Wages Quarterly census of employers covered under UI and federal employers covered under UCFE 95.3 percent of civilian wage and salary employment

QCEW – Quarterly Census of Employment and Wages Quarterly data (frequent) Released 6 months after reference period - timely 9.1 million records and growing 130 million in employment Units, employment and wages 6 digit NAICS and county, ownership  20 million data series available on the BLS website UI based, mandatory collections to run UI  Wages- 94% reported data  Employment- 98% reported data  Units- 90% reported data 4

UI Tax Rate, Actuarial Analysis and UI Benefit Rates UI-Covered Employment Local Area Unemployment Stats Personal Income (BEA) - U.S., State, County Gross Domestic Product (BEA) Economic Forecasting Current Employment Statistics Occupational Employment Statistics Job Creation/Destruction Size Class Dynamics Business Survival Rates Geocoded Establishments Occupational Employment Statistics Occupational Safety and Health Statistics Current Employment Statistics National Compensation Survey Industrial Price Program Occupational Safety and Health Statistics Programmatic Uses Benchmarking (Employment Base) General Economic Uses Quarterly Census of Employment & Wages Data (QCEW/ES-202) Analytical Uses Sampling Mass Layoff Statistics: linkages State Revenue Projections (BEA) JOLTS and Green Goods and Services JOLTS and Green Goods and Services and State Job Vacancy Surveys…..and other federal govt surveys Local Economic Development Indicators Cluster Analysis Shift Share Industry Diversity Indexes Location Quotients Federal Funds Allocation $250 Billion (HUD, USDA, HCFA/CHIP) Minimum Wage Studies Uses of Quarterly Census of Employment and Wages Data (QCEW/ES-202) Local Economic Impact Response Planning Local Government Services Planning Census Bureau Improve Economic Census Improve CPS each decennial population Census LEHD / LED Industry Code Sharing (3.3 M) County Business Patterns Local Transportation Planning Social Security Administration Updated as of 6/14/2011 Quarterly Press Releases, Annual Employment & Wages REMI and Input-Output Tables State/local industry employment & wages

Employment and Wage Data Number of establishments, monthly employment, and quarterly wages Available by: geographical area industry code size WAGES

QCEW Mapping Tool 7

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What are the BED? BED are longitudinally linked QCEW microdata – Unit of analysis is the Establishment BED Scope – Private sector, excludes private households 6.8 million establishments 107 million employment BED reveals the dynamics of the labor market BED data show gross job flows as well as net employment changes

What are the BED? A set of statistics measuring changes in employment at the establishment level on a quarterly basis  Job churn  Creative destruction

What are the BED?  Gross Job Gains – Expansions – Openings Births BED statistics break down the underlying dynamics of net employment change into the numbers and rates of gross jobs gained and gross jobs lost:  Gross Job Losses –Contractions –Closings Deaths

BED Press Release High Frequency and Timely Gross Job Flows Available 8 months after the reference quarter  Most Recent BED Press Release Most Recent BED Press Release Two week speed-up last year Data and charts available on the BLS website: 

13 Business Employment Dynamics National Total Private National NAICS Sector National Firm Size State Total Private National Size of Employment Change Annual (National/State) Birth Death National/State) 3 Digit national data Age and survival National and State 2 digit September 2003 May 2004 December 2005 August 2007 September 2008 May 19, 2009 May 20, 2010 August 19, 2010 February 1, 2012

Gross Job Gains and Losses Gross job gains Gross job losses

BED Components Expansions Contractions Openings Closings

“A lesser-known employment snapshot, based on a quarterly census of state unemployment insurance records, shows the economy created about 19,000 private-sector jobs in the third quarter of 2006, the most recent data available... ” - May 24, Job Market’s Strength May Have Been Overstated

Construction of Buildings

Real Estate

Oklahoma: Gains & Losses

Oklahoma: Construction

Oklahoma: Education and Health Services

Arizona: Gains & Losses

North Dakota: Gains & Losses

24 Small Firms Lagging, With Bulk of Job Losses “Most of the job losses at the end of last year took place at the smallest firms, underscoring how small businesses are lagging in the recovery.”  August 19, SJ_economy_LeftTopHighlights

Source: U.S. Bureau of Labor Statistics Note: Shaded area represents NBER defined recession period

Why BED data by establishment age? 26 The Committee on National Statistics recommended employment dynamics data by age. Age and survival data along will complete ‘demographic’ profile of US businesses. Unsettled debate on who creates the most jobs: young or old firms? A debate similar to the small vs. large firms contribution to employment growth. The impact of age of firm/establishment on employment growth and productivity is inconclusive. New research (Young firms, Not Small Ones, Are the Engines of Growth ) showed controlling for age, there is no systematic relationship between firm size and growth.

Source: U.S. Bureau of Labor Statistics

28 “Weak Pace of Start-Ups could hurt Recovery” “Entrepreneurs have started up the fewest new U.S. businesses in more than a decade, according to government figures that could spell more bad news for job creation.”  USATODAY June 13, business-start-ups-fewer_n.htm

Source: U.S. Bureau of Labor Statistics Note: Shaded area represents NBER defined recession period

Source: U.S. Bureau of Labor Statistics Note: Shaded area represents NBER defined recession period

Oklahoma: Births & Deaths

Source: U.S. Bureau of Labor Statistics

Accessing the QCEW and BED Macrodata BED: QCEW:

Contact Information David M. Talan Phone: (202) Website: