OVERVIEW PROJECTIONS (2004-2014) AND FORECAST (2006-2009) OF INDUSTRY EMPLOYMENT, LABOR FORCE SUPPLY AND OCCUPATIONAL DEMAND STATEWIDE AND BY REGIONAL LABOR MARKET AREA Prepared For the March 1, 2007 OCCUPATIONAL FORECASTING CONFERENCE LOCAL - PowerPoint PPT Presentation

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OVERVIEW PROJECTIONS (2004-2014) AND FORECAST (2006-2009) OF INDUSTRY EMPLOYMENT, LABOR FORCE SUPPLY AND OCCUPATIONAL DEMAND STATEWIDE AND BY REGIONAL LABOR MARKET AREA Prepared For the March 1, 2007 OCCUPATIONAL FORECASTING CONFERENCE LOCAL

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overview projections (2004-2014) and forecast (2006-2009) of industry employment, labor force supply and occupational demand statewide and by regional labor market area – PowerPoint PPT presentation

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Title: OVERVIEW PROJECTIONS (2004-2014) AND FORECAST (2006-2009) OF INDUSTRY EMPLOYMENT, LABOR FORCE SUPPLY AND OCCUPATIONAL DEMAND STATEWIDE AND BY REGIONAL LABOR MARKET AREA Prepared For the March 1, 2007 OCCUPATIONAL FORECASTING CONFERENCE LOCAL


1
OVERVIEW PROJECTIONS (2004-2014) AND FORECAST
(2006-2009) OFINDUSTRY EMPLOYMENT, LABOR
FORCE SUPPLY AND OCCUPATIONAL DEMANDSTATEWIDE
AND BY REGIONAL LABOR MARKET AREAPrepared For
the March 1, 2007OCCUPATIONAL FORECASTING
CONFERENCELOCAL REVIEW MEETING
2
DATA SOURCES
  • EMPLOYMENT DATA
  • Louisiana Department of Labor
  • (ES-202 DATA) 1990-2004
  • Bureau of Labor Statistics
  • Current Employment Statistics SurveyBenchmark
    2005 (2005 and 2006)
  • Geography State and Metropolitan Statistical
    Area
  • Quarterly Census of Employment and Wages (up to
    second quarter of 2006)
  • Geography parish and planning area
  • LABOR FORCE AND POPULATION DATA
  • U.S. Census Bureau
  • IRS Statistical Unit
  • Systems Solutions Consulting
  • Bureau of Labor Statistics

3
PROJECTIONS AND FORECAST ASSUMPTIONS
  • EMPLOYMENT
  • National Assumptions
  • Latest Bureau of Labor Statistics
  • 2004-2014 long term assumptions about labor
    productivity, GDP growth, PCE growth and industry
    growth by four-digit NAICS
  • State Assumptions
  • Short-term and long term trends in three and
    four-digit NAICS industries between 1990 and
    2004.
  • Quarterly Census of Employment and Current
    Employment Statistics Survey for 2005 and 2006
    for incremental changes in employment by two and
    three digit NAICS.
  • Year 2007 forecast heavily influenced by
    2004-2006 monthly changes. 2008 and 2009 are
    forecasts influenced by assumptions about
    short-term events
  • Years 2008 and 2009 forecast reflects assumptions
    about recovery, national growth and 2000-2006
    historical Louisiana industry growth
  • Years 2009-2014 industry employment projections
    equations reflect projected national growth rates
    and historical growth rates for selected
    industry.

4
PROJECTIONS AND FORECAST ASSUMPTIONS
  • Regional Labor Market Area Assumptions
  • Years 1990-2004 growth rates by industry
  • Monthly trends from Current Employment Statistics
    (CES) for period 1997 to 2006 to identify
    seasonal monthly employment trendsused to
    forecast Year 2007 only.
  • Quarterly Census of Employment and Wage data for
    2005 and up to second quarter 2006 updated with
    CES data
  • For MSAs Census data for trends in establishment
    births and deaths.
  • For example in 2002-2003, in the Alexandria MSA
    there were 309 establishment births and 266
    establishment deaths.
  • The establishment births added 1,796 jobs, but
    establishment deaths resulted in a loss of 2,006
    jobs.
  • Regional industry short-term forecasts and
    long-term projections follow same process as
    statewide employment forecasts and projections

5
PROJECTIONS AND FORECAST ASSUMPTIONS
  • Population and Labor Force
  • Statewide Population
  • Pre-Hurricanes Katrina and Rita, Louisiana
    population growth continued to hemorrhage
  • Between 2000 and 2004, domestic out-migration
    exceeded in-migration by 75,000 individuals
  • Post-Hurricane Katrina and Rita, Louisianas July
    1, 2006 population was estimated by the Census
    Bureau to be 182,000 lower than the 2000 Census.
  • Every Regional Labor Market in the State, except
    Baton Rouge, experienced a net out-migration
    between 2000 and 2005.
  • ASSUMPTIONS
  • Louisianas total population is not likely to
    recover to the 2000 Census level until 2010.
  • Even though population growth is slow to recover,
    overall labor force participation rates will rise
    faster than the United States. In 2006,
    Louisianas labor force participation rate was
    55.7. The United States rate was estimated at
    65.
  • The labor force assumption is an optimistic
    assumption because the percentage change in
    participation rates in Louisiana correlated above
    90 with the percentage change in participation
    rates in the United States for the 1980, 1990 and
    2000 Censuses.

6
PROJECTIONS AND FORECAST ASSUMPTIONS
  • Population and Labor Force
  • Regional Labor Market Areas
  • For all RLMAs, except the New Orleans region,
    population and labor force projections follow
    pre-Hurricane Katrina and Rita trends within each
    region. These trends cover the period 1990 to
    2005.
  • Historical statewide data for population and
    labor force and lagged by one-year labor force
    population are used independent variable to
    predict 2006-2014 labor force population.
    Pre-Hurricane statewide labor force population
    projections and the previous years projected
    labor force for planning area are used to predict
    future year labor force population.
  • Labor market participation rates are a function
    of the states historical and projected
    participation rates.

7
Louisiana Overview
8
Louisiana Overview
9
Louisiana Overview
10
Louisiana Overview
11
OCCUPATIONAL PROJECTIONS
  • Foundation For Occupational Projections
  • LDOL surveys Louisiana firms on the occupational
    composition of their workforce and wages for
    those occupations. The survey is called
    Occupational Employment Statistics Survey.
  • Occupational projections contain both industry
    employment projections and self-employed.
  • A random sample of 7,500 employers in the state,
    representing firms of all sizes, is the universe
    for occupational data.
  • Process of Projecting Occupations
  • Three data elements are included to determine
    total demand for an occupation
  • Total employment in the identified industries
  • Self-employment
  • Replacement or turn-over rates

12
OCCUPATIONAL PROJECTIONS
  • Process of Projecting Occupations
  • Example, if employment increases and for
    occupation- example --welder
  • Mining Services
  • (Initial conditions)
  • 2006 employment 100
  • 2007 employment 110
  • Total change in new growth 10
  • Occupational Information
  • Welders 10 of total workforce
  • Replacement rate of welders is 5 annually
  • Estimating Occupational Demand
  • 10 (growth) X 0.10 100 (base year employment) X
    0.05 total demand
  • (10 X 0.10 1 100 X 0.05 5) total demand
    (6) for welder occupation in 2007
  • What Have You Learned?
  • The majority of total demand in most industries
    comes from replacement demand, not growth.

13
ISSUES
  • Potential vs. Estimated Employment For Some
    Future Year.
  • This is an issue that is more or less an
    accounting problem, and has to deal with
    establishment births and deaths. Recall this
    problem
  • For MSAs Census data for trends in establishment
    births and deaths.
  • For example in 2002-2003 and in the Alexandria
    MSA, there were 309 establishment births and 266
    establishment deaths.
  • The establishment births added 1,796 jobs, but
    establishment deaths resulted in a loss of 2,006
    jobs
  • Labor Force and Jobs
  • Available labor force does overtime serve as a
    constraint in the potential vs. estimated
    realized employment.
  • Replacement Rates
  • The replacement of is low. It is important
    to recognize that replacement rates are
    annualized. Therefore, it is possible that all of
    the individuals retiring could occur (in reality)
    in a compressed period of time. As an example,
    the replacement rate for Chemical Plant and
    Systems Operators is 3 per year over the time
    frame. This might seem low on first glance.
    However, if the projection period is for ten
    years, this implies that 30 of the entire
    Chemical Plant and Systems Operators will be
    retired or replaced within that time frame.

14
ISSUES
  • Annual Demand For New Jobs
  • The annual demand for carpenters is low. We
    have a project that studies show will require
    1,000 new construction jobs.
  • There are several response to this comment.
  • First, the same issue of annualized demand
    applies to growth in occupational demand
  • Second, annualized demand, by the virtue that it
    is annualized, removes peaks and valleys in
    employment data.
  • Labor is a constraint. As noted earlier, almost
    every region of the state has had negative
    migration rate. Saying you need is very
    different from what you might get.
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