Technical Note Special technical note: This technical note describes the procedures regularly used for the Quarterly Census of Employment and Wages (QCEW) program. Due to COVID-19, some of the procedures described in this technical note have been modified. The modifications are briefly described in the box notes in this news release and are described in more detail at www.bls.gov/covid19/effects-of-covid-19-pandemic-on-county-employment-and-wages-data.htm and also at www.bls.gov/cew/additional-resources/imputation-methodology.htm. These data are the product of a federal-state cooperative program, the Quarterly Census of Employment and Wages program, also known as the ES-202 program. The data are derived from summaries of employment and total pay of workers covered by state and federal unemployment insurance (UI) legislation and provided by State Workforce Agencies (SWAs). The summaries are a result of the administration of state unemployment insurance programs that require most employers to pay quarterly taxes based on the employment and wages of workers covered by UI. QCEW data in this release are based on the 2017 North American Industry Classification System (NAICS). Data for 2020 are preliminary and subject to revision. For purposes of this release, large counties are defined as having employment levels of 75,000 or greater. In addition, data for San Juan, PR, are provided, but not used in calculating U.S. averages, rankings, or in the analysis in the text. Each year, these large counties are selected on the basis of the preliminary annual average of employment for the previous year. The 358 counties presented in this release were derived using 2019 preliminary annual averages of employment. For 2020 data, three counties have been added to the publication tables: Baldwin, AL; Iredell, NC; and Gregg, TX. One county has been dropped from the publication tables: Bay, FL. These counties will be included or excluded, respectively, in all 2020 quarterly releases. The counties in table 2 are selected and sorted each year based on the annual average employment from the preceding year. The preliminary QCEW data presented in this release may differ from data released by the individual states. These potential differences result from the states' continuing receipt of UI data over time and ongoing review and editing. The individual states determine their data release timetables. Differences between QCEW, BED, and CES employment measures The Bureau publishes three different establishment-based employment measures for any given quarter: QCEW, Business Employment Dynamics (BED), and Current Employment Statistics (CES). Each of these measures makes use of the quarterly UI employment reports in producing data; however, each measure has a somewhat different universe coverage, estimation procedure, and publication product. Differences in coverage and estimation methods can result in somewhat different measures of employment change over time. It is important to understand program differences and the intended uses of the program products. (See table.) Additional information on each program can be obtained from the program Web sites shown in the table. Summary of Major Differences between QCEW, BED, and CES Employment Measures ---------------------------------------------------------------------------------- | QCEW | BED | CES -----------|---------------------|----------------------|------------------------ Source |--Count of UI admini-|--Count of longitudi- |--Sample survey: | strative records | nally-linked UI ad- | 697,000 establish- | submitted by 10.4 | ministrative records| ments | million establish- | submitted by 8.3 | | ments in first | million private-sec-| | quarter of 2020 | tor employers | -----------|---------------------|----------------------|------------------------ Coverage |--UI and UCFE cover- |--UI coverage, exclud-|--Nonfarm wage and sal- | age, including all | ing government, pri-| ary jobs: | employers subject | vate households, and| -UI coverage, exclud- | to state and fed- | establishments with | ing agriculture, pri- | eral UI laws | zero employment | vate households, and | | | self-employed workers | | | -Other employment, | | | including railroads, | | | religious organiza- | | | tions, and other non- | | | UI-covered jobs -----------|---------------------|----------------------|------------------------ Publication|--Quarterly |--Quarterly |--Monthly frequency | -Within 5 months | -7 months after the | -Usually the 3rd | after the end of | end of each quarter| Friday after the end | each quarter | | of the week including | | | the 12th of the month -----------|---------------------|----------------------|------------------------ Use of UI |--Directly summarizes|--Links each new UI |--Uses UI file as a sa- file | and publishes each | quarter to longitu- | mpling frame and to | new quarter of UI | dinal database and | annually realign sam- | data | directly summarizes | plebased estimates to | | gross job gains and | population counts | | losses | (benchmarking) -----------|---------------------|----------------------|------------------------ Principal |--Provides a quarter-|--Provides quarterly |--Provides current mon- products | ly and annual uni- | employer dynamics | thly estimates of emp- | verse count of es- | data on establish- | loyment, hours, and | tablishments, em- | ment openings, clos-| earnings at the MSA, | ployment, and wages| ings, expansions, | state, and national | at the county, MSA,| and contractions at | level by industry | state, and national| the national level | | levels by detailed | by NAICS supersec- | | industry | tors and by size of | | | firm, and at the | | | state private-sector| | | total level | | |--Future expansions | | | will include data | | | with greater indus- | | | try detail and data | | | at the county and | | | MSA level | -----------|---------------------|----------------------|------------------------ Principal |--Detailed locality |--Business cycle |--Principal federal uses | data | analysis | economic indicator | | | (PFEI) |--Periodic universe |--Analysis of employ- |--Official time series | counts for bench- | er dynamics under- | for employment change | marking sample | lying economic ex- | measures | survey estimates | pansions and con- |--Input into other ma- |--Sample frame for | tractions | jor economic indi- | BLS establishment |--Analysis of employ- | cators | surveys | ment expansion and | | | contraction by size | | | of firm | | | | -----------|---------------------|----------------------|------------------------ Program |--www.bls.gov/cew |--www.bls.gov/bdm |--www.bls.gov/ces Web sites | | | --------------------------------------------------------------------------------- Coverage Employment and wage data for workers covered by state UI laws are compiled from quarterly contribution reports submitted to the SWAs by employers. For federal civilian workers covered by the Unemployment Compensation for Federal Employees (UCFE) program, employment and wage data are compiled from quarterly reports submitted by four major federal payroll processing centers on behalf of all federal agencies, with the exception of a few agencies which still report directly to the individual SWA. In addition to the quarterly contribution reports, employers who operate multiple establishments within a state complete a questionnaire, called the "Multiple Worksite Report," which provides detailed information on the location and industry of each of their establishments. QCEW employment and wage data are derived from microdata summaries of 10.2 million employer reports of employment and wages submitted by states to the BLS in 2019. These reports are based on place of employment rather than place of residence. UI and UCFE coverage is broad and has been basically comparable from state to state since 1978, when the 1976 amendments to the Federal Unemployment Tax Act became effective, expanding coverage to include most state and local government employees. In 2019, UI and UCFE programs covered workers in 148.1 million jobs. The estimated 142.5 million workers in these jobs (after adjustment for multiple jobholders) represented 97.1 percent of civilian wage and salary employment. Covered workers received $8.769 trillion in pay, representing 94.2 percent of the wage and salary component of personal income and 40.9 percent of the gross domestic product. Major exclusions from UI coverage include self-employed workers, most agricultural workers on small farms, all members of the Armed Forces, elected officials in most states, most employees of railroads, some domestic workers, most student workers at schools, and employees of certain small nonprofit organizations. State and federal UI laws change periodically. These changes may have an impact on the employment and wages reported by employers covered under the UI program. Coverage changes may affect the over-the-year comparisons presented in this news release. Concepts and methodology Monthly employment is based on the number of workers who worked during or received pay for the pay period including the 12th of the month. With few exceptions, all employees of covered firms are reported, including production and sales workers, corporation officials, executives, supervisory personnel, and clerical workers. Workers on paid vacations and part-time workers also are included. Average weekly wage values are calculated by dividing quarterly total wages by the average of the three monthly employment levels (all employees, as described above) and dividing the result by 13, for the 13 weeks in the quarter. These calculations are made using unrounded employment and wage values. The average wage values that can be calculated using rounded data from the BLS database may differ from the averages reported. Included in the quarterly wage data are non-wage cash payments such as bonuses, the cash value of meals and lodging when supplied, tips and other gratuities, and, in some states, employer contributions to certain deferred compensation plans such as 401(k) plans and stock options. Over-the-year comparisons of average weekly wages may reflect fluctuations in average monthly employment and/or total quarterly wages between the current quarter and prior year levels. Average weekly wages are 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 and the incidence of pay periods within a quarter. For instance, the average weekly wage of the workforce could increase significantly when there is a large decline in the number of employees that had been receiving below-average wages. Wages may include payments to workers not present in the employment counts because they did not work during the pay period including the 12th of the month. When comparing average weekly wage levels between industries, states, or quarters, these factors should be taken into consideration. Wages measured by QCEW may be subject to periodic and sometimes large fluctuations. This variability may be due to calendar effects resulting from some quarters having more pay dates than others. The effect is most visible in counties with a dominant employer. In particular, this effect has been observed in counties where government employers represent a large fraction of overall employment. Similar calendar effects can result from private sector pay practices. However, these effects are typically less pronounced for two reasons: employment is less concentrated in a single private employer, and private employers use a variety of pay period types (weekly, biweekly, semimonthly, monthly). For example, the effect on over-the-year pay comparisons can be pronounced in federal government due to the uniform nature of federal payroll processing. Most federal employees are paid on a biweekly pay schedule. As a result, in some quarters federal wages include six pay dates, while in other quarters there are seven pay dates. Over-the-year comparisons of average weekly wages may also reflect this calendar effect. Growth in average weekly wages may be attributed, in part, to a comparison of quarterly wages for the current year, which include seven pay dates, with year-ago wages that reflect only six pay dates. An opposite effect will occur when wages in the current quarter reflecting six pay dates are compared with year-ago wages for a quarter including seven pay dates. In order to ensure the highest possible quality of data, states verify with employers and update, if necessary, the industry, location, and ownership classification of all establishments on a 3-year cycle. Changes in establishment classification codes resulting from this process are introduced with the data reported for the first quarter of the year. Changes resulting from improved employer reporting also are introduced in the first quarter. QCEW data are not designed as a time series. QCEW data are simply the sums of individual establishment records and reflect the number of establishments that exist in a county or industry at a point in time. Establishments can move in or out of a county or industry for a number of reasons that reflect economic events or administrative changes. For example, economic change would come from a firm relocating into the county; administrative change would come from a company correcting its county designation. The over-the-year changes of employment and wages presented in this release have been adjusted to account for most of the administrative corrections made to the underlying establishment reports. This is done by modifying the prior-year levels used to calculate the over-the-year changes. Percent changes are calculated using an adjusted version of the final 2019 quarterly data as the base data. The adjusted prior-year levels used to calculate the over-the-year percent change in employment and wages are not published. These adjusted prior-year levels do not match the unadjusted data maintained on the BLS Web site. Over-the-year change calculations based on data from the Web site, or from data published in prior BLS news releases, may differ substantially from the over-the-year changes presented in this news release. The adjusted data used to calculate the over-the-year change measures presented in this release eliminate the effect of most of the administrative changes (those occurring when employers update the industry, location, and ownership information of their establishments). The most common adjustments for administrative change are the result of updated information about the county location of individual establishments. Included in these adjustments are administrative changes involving the classification of establishments that were previously reported in the unknown or statewide county or unknown industry categories. Adjusted data account for improvements in reporting employment and wages for individual and multi-unit establishments. To accomplish this, adjustments were implemented to account for: administrative changes caused by multi-unit employers who start reporting for each individual establishment rather than as a single entity (first quarter of 2008); selected large administrative changes in employment and wages (second quarter of 2011); and state verified improvements in reporting of employment and wages (third quarter of 2014). These adjustments allow QCEW to include county employment and wage growth rates in this news release that would otherwise not meet publication standards. The adjusted data used to calculate the over-the-year change measures presented in any County Employment and Wages news release are valid for comparisons between the starting and ending points (a 12-month period) used in that particular release. Comparisons may not be valid for any time period other than the one featured in a release even if the changes were calculated using adjusted data. County definitions are assigned according to Federal Information Processing Standards Publications (FIPS PUBS) as issued by the National Institute of Standards and Technology, after approval by the Secretary of Commerce pursuant to Section 5131 of the Information Technology Management Reform Act of 1996 and the Computer Security Act of 1987, Public Law 104-106. Areas shown as counties include those designated as independent cities in some jurisdictions and, in Alaska, those designated as census areas where counties have not been created. County data also are presented for the New England states for comparative purposes even though townships are the more common designation used in New England (and New Jersey). The regions referred to in this release are defined as census regions. Additional statistics and other information Employment and Wages Annual Averages Online features comprehensive information by detailed industry on establishments, employment, and wages for the nation and all states. The 2019 edition of this publication, which was published in September 2020, contains selected data produced by Business Employment Dynamics (BED) on job gains and losses, as well as selected data from the first quarter 2020 version of this news release. Tables and additional content from the 2019 edition of Employment and Wages Annual Averages Online are now available at www.bls.gov/cew/publications/employment-and-wages-annual-averages/2019/home.htm. The 2020 edition of Employment and Wages Annual Averages Online will be available in September 2021. News releases on quarterly measures of gross job flows also are available from BED at www.bls.gov/bdm, (202) 691-6467, or data.bls.gov/cgi-bin/forms/bdm. Information in this release will be made available to sensory impaired individuals upon request. Voice phone: (202) 691-5200; TDD message referral phone number: (800) 877-8339.