Economic Thinking In Action

Using U.S. BLS location quotient to study job concentration within a given labor market

Job location quotients are ratios that compare the concentration of a particular job in a defined area to that of a larger area. For example, job location quotients compare MSA employment to that of the nation.

For instance, the BLS shows that employment per thousand jobs for JOB 1 is 0.41 in AREA 1. In the nation as a whole, the employment per thousand for JOB 1 is 0.13. The job title location quotient in this example is 3.09 = (0.41)/(0.13) .

The location quotient in this example is the ratio of the area concentration of occupational employment to the national average concentration. A location quotient greater than one indicates that the occupation has a higher share of employment than average, and a location quotient less than one indicates the occupation is less prevalent in the area than average.

Just move already…geographic mobility and economic opportunity

In Chapter 6 of Moretti’s book ‘Geography of Jobs’, he argues that geographic mobility is a key to economic prosperity. The ability and willingness to move from an economically depressed area to a more robust one benefits not only the individual who moves but also the individuals and businesses in both areass.

Prof. Moretti points out that a number of countries that have low geographic mobility rates also have low economic activity measures. He uses his home country Italy as an example of a country where people do not move. Most interesting he makes the case for national mobility voucher program in the U.S.. The idea is that subsidizing a person’s move will help equalize economic opportunities across the nation. He closes the chapter discussing gentrification which he views as a good thing given all the pluses that arise from it.

Statistical analysis of VA wait times on the way

The number of military Veterans requesting care from the VA is at a historic high.

In the coming weeks, we will be publishing a series of post describing the work we have performed on VA wait times data obtained from the LA Times.

The underlying VA data was obtained from the June 2014 government audit of the VA. In our study we look at:

– The different types of wait times experienced by military veterans

– Socio-economic factors related to VA times such as percentage of vets and poverty rates in the surrounding area

– Detailed look at vets receiving mental health care and the wait times that they experience

Texas job openings increased from May 2014 to June 2014

The number of job openings in Texas increased from 342,800 in May 2014 to 343,517 in June 2014. The median number of job searchers per job opening across all MSAs (metropolitan statistical areas) and occupations in Texas was 1.29 in May 2014 and 1.47 in June 2014.

Both Crude Oil and Natural Gas Prices Decreased from June 2014 to July 2014

prices_2014_07

Crude oil price decreased from $106.07 per barrel in June 2014 to $98.23 per barrel in July 2014. Natural gas price went down from $4.39 per million BTU (one million BTU is approximately 974 cubic feet) in June 2014 to $3.78 per million BTU in July 2014.

production_2014_05

Texas crude oil production for May 2014 was 66,235,787 barrels, down from 66,731,327 barrels reported in April 2014. Texas natural gas production was 617,988,757 Mcf (thousand cubic feet) of gas in May 2014, up from the April 2014 gas production total of 624,551,008 Mcf.

Medical Care Commodities Inflate at a Higher Rate than General Inflation from May 2014 to June 2014

The consumer price index (CPI) went up from 37.083 in May 2014 to 237.693 in June 2014, an annualized rate of 3.09%.

The price index for medical care commodities went up at an annualized rate of 8.36% from May 2014 to June 2014. During the same period, the price index for medical care services and professional services went down at an annualized rate of 0.16% and 1.31%, respectively, whereas hospital and related services went up at 2.06%.

Image source: http://www.shutterstock.com/pic-54762670/stock-photo-background-concept-illustration-consumer-price-index.html

Significant new government compensation data reporting requirements on the way from the OFCCP

Seyfarth Shaw LLP and a number of other OFCCP watchers reported recently on Office of Federal Contract Compliance Programs (“OFCCP”) notice of proposed rulemaking (“NPRM”) that would require most Federal contractors and first-tier subcontractors to submit compensation data to the OFCCP through a web-based filing system on an annual basis. The stated goal of the new data is to provide the OFCCP better data to monitor and analyze the pay of men and women in the workforce.

According to Federal Register, Vol. 79, No. 153, August 8, 2014, the OFCCP’s new data requirement will require contractors and subcontractors to provide:

The total number of workers within a specific EEO-1 job category by race, ethnicity and sex;
Total W-2 wages for all workers in the EEO-1 job category by race, ethnicity and sex; and
Total hours worked by all employees in the EEO-1 job category by race, ethnicity and sex.

The Department of Labor estimates that the the total cost of the rule change is $50,009,885, $46,250,189 will be first year cost.

Texas Nurses, Therapists, and Physician Assistants See Increase in both Job Openings and Searchers per Job Opening from April 2014 to May 2014

The number of job openings and searcher-to-job opening ratio in Texas for nurses, therapists, and physician assistants increased from 9,292 and 0.95, respectively, in April 2014 to 9,612 and 1.09, respectively, in May 2014.

Image Source: http://www.carrollhs.org/s/1253/index.aspx?pgid=877

Median Rent Rises in Three Largest MSAs Near Eagle Ford Shale from April 2014 to May 2014

Median rent rose in all three MSAs (metropolitan statistical areas) from April 2014 to May 2014.

Median house prices for San Antonio and Laredo rose from April 2014 to May 2014. Median house prices for Corpus Christi fell from March 2014 to April 2014.

Moretti’s economic tale of two cites: where Microsoft is now and Albuquerque

In Moretti’s book, he provides a detail study of how innovation jobs can be economic driver and dictate the economic future of a town, city or region.

Moretti discusses where Microsoft (MSFT) is now , Seattle, and Albuquerque, NM. These two cities embody the natural experiment that he suggest shows the impact of innovation jobs. In short he shows how one town has grown and blossomed and the other has not.

He points to three factors that have lead to the drastic divergence.

1 Job Creation. The sheer number of innovation jobs created by Microsoft both directly and the tradition jobs that were created indirectly.

2. The MSFT millionaires. These millionairies changed the landscape of Seattle as they started their own companies in around the city (and the industry).

3. The Hubs. According to Moretti cities like Seattle have become ‘Hubs’ that attract other businesses. Many businesses find that the existence of other companies both in their industry (competitors) and related companies attracts other companies and makes it easier for them to do business