Wednesday, February 19, 2014Tweet
[IWS] BLS: MEASURING OCCUPATIONAL CONCENTRATION BY INDUSTRY [19 February 2014]
IWS Documented News Service
Institute for Workplace Studies----------------- Professor Samuel B. Bacharach
School of Industrial & Labor Relations-------- Director, Institute for Workplace Studies
16 East 34th Street, 4th floor---------------------- Stuart Basefsky
New York, NY 10016 -------------------------------Director, IWS News Bureau
BEYOND THE NUMBERS, February 2014, Vol. 3, No. 3
EMPLOYMENT & UNEMPLOYMENT
MEASURING OCCUPATIONAL CONCENTRATION BY INDUSTRY [19 February 2014]
[full-text, 13 pages]
Although some occupations are found in nearly every industry in the United States, others are specific to one or only a few industries. For example, several of the most concentrated occupations in the coal mining industry are found primarily in that industry, and are uncommon outside of the mining and extraction sector. As a result, job mobility for these workers might be extremely limited in the face of an industry downturn, particularly one affecting the extraction industries in general. On the other hand, although over a quarter of computer systems analysts are found in the computer systems design and related services industry, this occupation was distributed relatively evenly across sectors, potentially allowing displaced workers to move more easily into other industries. Understanding the relationship between industry and occupation may provide important insights into workers’ ability to cope with job loss by moving across industries.
This BEYOND THE NUMBERS article uses two tools—the Herfindahl-Hirschman index (HHI) and industry quotients—to measure occupational specialization by industry. Although some industries use specialized labor highly intensively, others rely on less specialized occupations that are also prevalent elsewhere in the economy. These differences in industry staffing patterns may affect workers’ ability to respond effectively and flexibly to changes in the economy. Occupations concentrated in a single industry, such as travel agents or shoe machine operators and tenders, may require skills that are highly specific to that industry. If workers in these occupations become unemployed, it may be difficult for them to use their skills in other industries. However, workers in more widely distributed occupations may find it easier to transfer their skills in response to job loss. Occupational composition also may affect a growing industry's ability to attract workers from elsewhere in the economy. For example, industries that rely on specialized, highly qualified workers may find that the high skill and training requirements act as a barrier to entry for displaced workers from other sectors.
Several different measures are available for examining the industry and occupation relationship. Traditional tools include measuring the share of total occupational employment found in a given industry, as well as the share of total industry employment made up of a specific occupation. For instance, 62 percent of registered nurses were employed in hospitals in May 2012, and registered nurses made up 29 percent of total hospital employment, showing a strong relationship between this industry and occupation.
However, these statistics provide only a partial picture of the relationship between occupation and industry. For example, they don’t offer a convenient way of comparing which occupations are most and least concentrated by industry, nor do they allow for easy identification of industries that use specific occupations intensively. The HHI and industry quotients are additional tools that provide a complementary perspective on the industry and occupation relationship.
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