The Location Quotient Calculator is a tool on the BLS website that creates, on demand, tables of private sector employment data, by industry, as measured by the Quarterly Census of Employment and Wages (QCEW) program. The calculator allows the ready comparison of relative employment levels in the United States, states, counties, and Metropolitan Statistical Areas (MSAs).
Location Quotients (LQs) are ratios that allow an area's distribution of employment by industry to be compared to a reference or base area's distribution. The reference area is usually the U.S., but it can also be a state or a metropolitan area. The reference or base industry is usually the All industry total. The discussion below assumes the defaults are used. LQs also allow areas to be easily compared to each other.
If an LQ is equal to 1, then the industry has the same share of its area employment as it does in the reference area. An LQ greater than 1 indicates an industry with a greater share of the local area employment than is the case in the reference area. For example (assuming the U.S. as the reference area), Las Vegas will have an LQ greater than 1 in the Leisure and Hospitality industry because this industry makes up a larger share of the Las Vegas employment total than it does for the country as a whole.
LQs are calculated by first, dividing local industry employment by the all industry total of local employment. Second, reference area industry employment is divided by the all industry total for the reference area. Finally, the local ratio is divided by the reference area ratio.
The location quotient calculator makes available three standard industry groups that can be used to study the entire spectrum of industries as classified by NAICS. As the location quotient calculator is currently limited to presenting private sector data, the industry groups do not include the Public Administration sector. The highest level (most aggregated) group is the SuperSector group. The second highest is the Sector group, and the most detailed is the Sub-Sector group.
The 2002 version of the North American Industry Classification System (NAICS) is the industry coding system used by the location quotient calculator.
Ratio of industry employment to base-industry employment times 100.
As an alternative to selecting one or more of the standard industry groups, users may designate one or a number of specific industries from the full range of private-sector industries defined under NAICS.
The reference year for the data.
The reference period for the data to be analyzed. This is currently limited to annual averages. The reduced detail currently available on the database for other time periods would significantly limit the location quotients that could be calculated.
This is currently limited to employment.
This is currently limited to private ownership.
This is currently limited to the aggregate category of all establishment sizes.
The location quotient tool calculates location quotients with respect to a base or reference area and from one to three analysis areas.
The default base or reference area is the United States Total. This can be readily overridden for special purposes such as intrastate analysis. Users are cautioned that if they select an area other than the U.S. Total as the base area, they may develop location quotients that have little or no economic meaning.
Up to three analysis areas may be specified. For most location quotient purposes, the analysis area(s) should be a subset or component of the base area.
The users must designate the group or groups of industries, or the specific industries they wish to have processed by the location quotient tool. The industries are defined under the 2002 version of the North American Industry Classification System.
The default base or reference industry is the All industry total. This can be readily overridden for special purposes such as sector breakdown analysis. Users are cautioned that if they select an industry other than the all industry total, they may develop location quotients that have little or no economic meaning.
At least one industry or industry group must be selected to use the location quotient tool.
Private sector QCEW data is available for areas classified by Metropolitan Statistical Area (MSA). The QCEW data used by the location quotient calculator is classified according MSA definitions released by the Office of Management and Budget as of March 2004.
BLS has defined a total of twelve SuperSectors, one of which is Public Administration. The eleven SuperSectors used for classifying private-sector activity are:
- Natural Resources and Mining
- Trade, Transportation, and Utilities
- Financial Activities
- Professional and Business Services
- Education and Health Services
- Leisure and Hospitality
- Other Services
The 20 NAICS Sectors used for classifying private sector activity are:
- NAICS 11 Agriculture, forestry, fishing and hunting
- NAICS 21 Mining
- NAICS 31-33 Manufacturing
- NAICS 23 Construction
- NAICS 44-45 Retail trade
- NAICS 42 Wholesale trade
- NAICS 22 Utilities
- NAICS 48-49 Transportation and warehousing
- NAICS 51 Information
- NAICS 52 Finance and insurance
- NAICS 53 Real estate and rental and leasing
- NAICS 54 Professional and technical services
- NAICS 55 Management of companies and enterprises
- NAICS 56 Administrative and waste services
- NAICS 61 Educational services
- NAICS 62 Health care and social assistance
- NAICS 71 Arts, entertainment, and recreation
- NAICS 72 Accommodation and food services
- NAICS 81 Other services, except public administration
- NAICS 99 Unclassified
The 93 NAICS sub-sectors used for classifying private sector activity are:
- NAICS 111 Crop production
- NAICS 112 Animal production
- NAICS 113 Forestry and logging
- NAICS 114 Fishing, hunting and trapping
- NAICS 115 Agriculture and forestry support activities
- NAICS 211 Oil and gas extraction
- NAICS 212 Mining, except oil and gas
- NAICS 213 Support activities for mining
- NAICS 236 Construction of buildings
- NAICS 237 Heavy and civil engineering construction
- NAICS 238 Specialty trade contractors
- NAICS 311 Food manufacturing
- NAICS 312 Beverage and tobacco product manufacturing
- NAICS 313 Textile mills
- NAICS 314 Textile product mills
- NAICS 315 Apparel manufacturing
- NAICS 316 Leather and allied product manufacturing
- NAICS 321 Wood product manufacturing
- NAICS 322 Paper manufacturing
- NAICS 323 Printing and related support activities
- NAICS 324 Petroleum and coal products manufacturing
- NAICS 325 Chemical manufacturing
- NAICS 326 Plastics and rubber products manufacturing
- NAICS 327 Nonmetallic mineral product manufacturing
- NAICS 331 Primary metal manufacturing
- NAICS 332 Fabricated metal product manufacturing
- NAICS 333 Machinery manufacturing
- NAICS 334 Computer and electronic product manufacturing
- NAICS 335 Electrical equipment and appliance mfg.
- NAICS 336 Transportation equipment manufacturing
- NAICS 337 Furniture and related product manufacturing
- NAICS 339 Miscellaneous manufacturing
- NAICS 423 Merchant wholesalers, durable goods
- NAICS 424 Merchant wholesalers, nondurable goods
- NAICS 425 Electronic markets and agents and brokers
- NAICS 441 Motor vehicle and parts dealers
- NAICS 442 Furniture and home furnishings stores
- NAICS 443 Electronics and appliance stores
- NAICS 444 Building material and garden supply stores
- NAICS 445 Food and beverage stores
- NAICS 446 Health and personal care stores
- NAICS 447 Gasoline stations
- NAICS 448 Clothing and clothing accessories stores
- NAICS 451 Sporting goods, hobby, book and music stores
- NAICS 452 General merchandise stores
- NAICS 453 Miscellaneous store retailers
- NAICS 454 Nonstore retailers
- NAICS 481 Air transportation
- NAICS 482 Rail transportation
- NAICS 483 Water transportation
- NAICS 484 Truck transportation
- NAICS 485 Transit and ground passenger transportation
- NAICS 486 Pipeline transportation
- NAICS 487 Scenic and sightseeing transportation
- NAICS 488 Support activities for transportation
- NAICS 491 Postal service
- NAICS 492 Couriers and messengers
- NAICS 493 Warehousing and storage
- NAICS 221 Utilities
- NAICS 511 Publishing industries, except Internet
- NAICS 512 Motion picture and sound recording industries
- NAICS 515 Broadcasting, except Internet
- NAICS 516 Internet publishing and broadcasting
- NAICS 517 Telecommunications
- NAICS 518 ISPs, search portals, and data processing
- NAICS 519 Other information services
- NAICS 521 Monetary authorities - central bank
- NAICS 522 Credit intermediation and related activities
- NAICS 523 Securities, commodity contracts, investments
- NAICS 524 Insurance carriers and related activities
- NAICS 525 Funds, trusts, and other financial vehicles
- NAICS 531 Real estate
- NAICS 532 Rental and leasing services
- NAICS 533 Lessors of nonfinancial intangible assets
- NAICS 541 Professional and technical services
- NAICS 551 Management of companies and enterprises
- NAICS 561 Administrative and support services
- NAICS 562 Waste management and remediation services
- NAICS 611 Educational services
- NAICS 621 Ambulatory health care services
- NAICS 622 Hospitals
- NAICS 623 Nursing and residential care facilities
- NAICS 624 Social assistance
- NAICS 711 Performing arts and spectator sports
- NAICS 712 Museums, historical sites, zoos, and parks
- NAICS 713 Amusements, gambling, and recreation
- NAICS 721 Accommodation
- NAICS 722 Food services and drinking places
- NAICS 811 Repair and maintenance
- NAICS 812 Personal and laundry services
- NAICS 813 Membership associations and organizations
- NAICS 814 Private households
- NAICS 999 Unclassified
Last Modified Date: March 22, 2005