U. S. Bureau of Labor Statistics
Business Employment
Dynamics: State Gross Flows
Eric Simants and David M. Talan
International Conference on Establishment Surveys
Montreal, QC
21 June 2007
The views expressed here are those of the authors and do not
necessarily reflect the official policy of the U.S. Bureau of
Labor Statistics.
Overview


Business Employment Dynamics
(BED)
State-level BED time series data
• Recession
• Recovery
• Gross Job Gains and Gross Job Losses
and its impact on Job Growth
2
What is Business Employment
Dynamics?



Longitudinal data series constructed
from quarterly cross-sectional data
Analyzes quarterly gross job flows
Unit of analysis is the
Establishment
• An establishment is defined as an
economic unit, typically located at a
unique physical site and engaged in
predominately one type of production
activity
3
BED Data Elements

Gross job gains
• Sum of job gains at Expanding and
Opening establishments

Gross job losses
• Sum of job losses at Contracting and
Closing establishments
4
State-level BED
Time Series Data



Data reveal some states began downturn
in job growth about one year prior to the
recession
Jobless recovery is evident for most states
6 quarters into the recovery
Job growth occurring in most states since
2003Q3
• Are more establishments expanding or
opening, or are less establishments contracting
or closing?
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Recession
6
Recession


2001Q1 shows the first time in the
national-level BED time series where gross
job losses greater than gross job gains
21 states had gross job losses in excess to
gross job gains in 2000Q3
• Declining trends for gross job gains coupled
with increasing trends for gross job losses in
most states may have been masked in
national-level time series data
7
Influence of larger states
on national BED time series


Four largest states in regards to total
employment (California, Texas, New York
and Florida) comprise nearly 1/3 of total
gross job gains and gross job losses
nationally
Gross job gains well above gross job
losses in these 4 states until 2001Q1
8
Influence of larger states
on national BED time series

CA, TX, NY, FL combined 2000Q3
data
• Gross job gains = 2,804,989
• Gross job losses = 2,553,053
• Difference
= 251,936

National 2003Q3 data
• Gross job gains = 8,724,000
• Gross job losses = 8,578,000
• Difference
= 146,000
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Influence of larger states
on national BED time series
10
Peak of Gross Job Losses



Gross job losses peak at over 9.1
million for the entire nation in
2001Q3
8 states (Arizona, Colorado, Florida,
Georgia, Hawaii, Nevada, Texas and
Utah) do not peak until 2001Q4
Result of backlash from Sept 11th
tragedies or consumers tightening
spending?
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Peak of Gross Job Losses
12
Peak of Gross Job Losses
13
Great Lake States



5 (IL, IN, MI, OH and WI) states
have gross job losses greater than
gross job gains in 2000Q3 – NY and
PA only 2 that didn’t
Began showing negative job growth
2 quarters prior to national data
3 (IN, MI, WI) have gross job losses
greater than gross job gains 2000Q3
through 2001Q4
14
Great Lake States
15
Recovery



Gross job losses declined rapidly in most
all states after 2001Q4
Only 13 (AZ, GA, HI, ID, KS, LA, MS, NE,
NV, SC, TX, UT, WY) states show gross job
gains in 2006Q3 greater than gross job
gains in 1996Q3
Since 2003Q3 less than half of all states
show gross job gains less than gross job
losses in 2 quarters or more
16
Recovery
17
Recovery

29 states have gross job losses
greater than gross job gains in
2006Q3
• CA, MO, NY, OH and PA show lowest
levels of gross job gains ever in 2006Q3

On the brink of another recession or
just temporary adjustment from
extremely low levels of gross job
losses seen in 2006Q1?
18
Trends in Gross Job Gains
and Gross Job Losses



Difference between summed gross job
gains and summed gross job losses from
2002Q1 – 2006Q3 is positive in all but 5
states
However, 22 states have declining trends
for gross job gains
Trends for gross job losses showing faster
declines than trends for gross job gains is
how many states are realizing job growth
19
Trends in Gross Job Gains
and Gross Job Losses
20
Regional Trends

Mid-Atlantic (DE, MD, NJ, PA, VA,
WV)
• Only 6 states nationally have larger
difference between gross job gains and
gross job losses than VA over the past 5
years
• PA has not had a quarter where gross
job losses exceed gross job gains since
2003Q3 and has only happened in 2
quarters in MD since 2003Q1 (2006Q2
and 2006Q3)
21
Regional Trends

Northeast and Midwest
• Only 5 (CT, IA, MN, NE and SD) states
have positive trends for gross job gains
and declining trends for gross job losses
since 2002Q1
• Only 4 (IA, MN, NY and WI) states are
in the top half of states in regards to
differences of summed gross job gains
and summed gross job losses since
2002Q1
22
Regional Trends

West and Southeast
• Six (AZ, CA, FL, NV, TX and WA) states
showing the largest positive differences
between summed gross job gains and
gross job losses since 2002Q1
• Only 7 (AK, CA, KS, KY, MO, NC and TN)
states out of 27 showing declining
trends in both gross job gains and gross
job losses since 2002Q1
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Summary


Short-run ebbs and flows of
economic activity and job growth are
unavoidable
State level BED time series data will
prove useful in understanding the
underlying labor market forces
driving employment dynamics
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Contact Information

Eric Simants
• [email protected]
• 202/691-5193

Dave Talan
• [email protected]
• 202/691-6467

Group Email: [email protected]
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