Economic News Release

Metropolitan Area Employment and Unemployment Technical Note

Technical Note
 
 
   This release presents labor force and unemployment data from the Local
Area Unemployment Statistics (LAUS) program (tables 1 and 2) for 372
metropolitan statistical areas and metropolitan New England City and
Town Areas (NECTAs), plus 8 areas in Puerto Rico. Estimates for 34
metropolitan and NECTA divisions also are presented. Nonfarm payroll
employment estimates from the Current Employment Statistics (CES)
program (tables 3 and 4) are provided for most of the same areas. State
estimates were previously published in the news release, Regional and
State Employment and Unemployment, and are republished in this release
for ease of reference. The LAUS and CES programs are both federal-state
cooperative endeavors.
 
Labor force and unemployment--from the LAUS program

   Definitions. The labor force and unemployment data are based on the
same concepts and definitions as those used for the official national
estimates obtained from the Current Population Survey (CPS), a sample
survey of households that is conducted for the Bureau of Labor
Statistics (BLS) by the U.S. Census Bureau. The LAUS program measures
employment and unemployment on a place-of-residence basis. The universe
for each is the civilian noninstitutional population 16 years of age and
over. Employed persons are those who did any work at all for pay or
profit in the reference week (the week including the 12th of the month)
or worked 15 hours or more without pay in a family business or farm,
plus those not working who had a job from which they were temporarily
absent, whether or not paid, for such reasons as labor-management
dispute, illness, or vacation. Unemployed persons are those who were not
employed during the reference week (based on the definition above), had
actively looked for a job sometime in the 4-week period ending with the
reference week, and were currently available for work; persons on layoff
expecting recall need not be looking for work to be counted as unemployed.
The labor force is the sum of employed and unemployed persons. The 
unemployment rate is the number of unemployed as a percent of the labor 
force.
   
   Method of estimation. Estimates for states, the District of
Columbia, the Los Angeles-Long Beach-Glendale metropolitan division, and
New York City are produced using time-series models with real-time
benchmarking to national CPS totals. Model-based estimation was extended
to the following areas and their respective balances of state in 2005:
the Chicago-Joliet-Naperville, IL Metropolitan Division; Cleveland-
Elyria-Mentor, OH Metropolitan Statistical Area; Detroit-Warren-Livonia,
MI Metropolitan Statistical Area; Miami-Miami Beach-Kendall, FL
Metropolitan Division; New Orleans-Metairie-Kenner, LA Metropolitan
Statistical Area; and Seattle-Bellevue-Everett, WA Metropolitan
Division. (Model-based estimation of the New Orleans-Metairie-Kenner
metropolitan area was suspended following Hurricane Katrina; the
indirect estimation methods described below will be used for this area
until further notice.) Modeling improves the statistical basis of the
estimation for these areas and provides important tools for analysis,
such as measures of errors and seasonally adjusted series. For all
other substate areas in this release, estimates are prepared through
indirect estimation procedures using a building-block approach.
Employment estimates, which are based largely on "place of work"
estimates from the CES program, are adjusted to refer to place of
residence as used in the CPS. Unemployment estimates are aggregates of
persons previously employed in industries covered by state unemployment
insurance (UI) laws and entrants to the labor force data from the CPS.
The substate estimates of employment and unemployment, which
geographically exhaust the entire state, are adjusted proportionally to
ensure that they add to the independently estimated state or balance-of-
state totals. A detailed description of the estimation procedures is
available from BLS upon request.

   Annual revisions. Labor force and unemployment data shown for the
prior year reflect adjustments made at the end of each year, usually
implemented with January estimates. The adjusted model-based estimates
reflect updated population data from the U.S. Census Bureau, any
revisions in the other data sources, and model reestimation. All
substate estimates are reestimated and adjusted to add to the revised
model-based estimates.

Employment--from the CES program

   Definitions. Employment data refer to persons on establishment
payrolls who receive pay for any part of the pay period that includes
the 12th of the month. Persons are counted at their place of work rather
than at their place of residence; those appearing on more than one
payroll are counted on each payroll. Industries are classified on the
basis of their principal activity in accordance with the 2012 version of
the North American Industry Classification System.

   Method of estimation. CES State and Area employment data are
produced using several estimation procedures. Where possible these data
are produced using a "weighted link relative" estimation technique in
which a ratio of current-month weighted employment to that of the
previous-month weighted employment is computed from a sample of
establishments reporting for both months. The estimates of employment
for the current month are then obtained by multiplying these ratios by
the previous month’s employment estimates. The weighted link relative
technique is utilized for data series where the sample size meets
certain statistical criteria.

   For some employment series, relatively small sample sizes limit the 
reliability of the weighted link-relative estimates. In these cases, 
BLS uses the CES small domain model (SDM) to generate employment estimates. 
The SDM combines the direct sample estimates (described above) and forecasts 
of historical (benchmarked) data to decrease the volatility of the estimates. 
For more detailed information about the CES small domain model, refer to the 
BLS Handbook of Methods.

   Annual revisions. Employment estimates are adjusted annually to a
complete count of jobs, called benchmarks, derived principally from tax
reports that are submitted by employers who are covered under state
unemployment insurance (UI) laws. The benchmark information is used to
adjust the monthly estimates between the new benchmark and the preceding
one and also to establish the level of employment for the new benchmark
month. Thus, the benchmarking process establishes the level of employment, 
and the sample is used to measure the month-to-month changes in the level 
for the subsequent months.

   Seasonal adjustment. Payroll employment data are seasonally adjusted for 
states, metropolitan areas, and metropolitan divisions at the total nonfarm 
level. For states, data are seasonally adjusted at the supersector level as 
well. In some metropolitan areas deemed large enough to be subdivided into 
metropolitan divisions, the seasonally adjusted payroll employment totals 
are computed by aggregating the seasonally adjusted total nonfarm estimates 
for each of the component metropolitan divisions. Revisions of historical 
data for the most recent 5 years are made once a year, coincident with 
annual benchmark adjustments.

Reliability of the estimates

   The estimates presented in this release are based on sample surveys,
administrative data, and modeling and, thus, are subject to sampling 
and other types of errors. Sampling error is a measure of sampling
variability--that is, variation that occurs by chance because a sample
rather than the entire population is surveyed. Survey data also are
subject to nonsampling errors, such as those which can be introduced
into the data collection and processing operations. Estimates not
directly derived from sample surveys are subject to additional errors
resulting from the specific estimation processes used. The sums of
individual items may not always equal the totals shown in the same
tables because of rounding. Unemployment rates are computed from
unrounded data and thus may differ slightly from rates computed using
the rounded data displayed in the tables.

   Labor force and unemployment estimates. Measures of sampling error
are not available for metropolitan areas or metropolitan divisions.
Model-based error measures for states are available on the BLS website
at www.bls.gov/lau/lastderr.htm. Measures of nonsampling error are not
available for the areas contained in this release. Information on recent
data revisions for states and local areas is available online at
www.bls.gov/lau/launews1.htm.

   Employment estimates. Measures of sampling error are available for 
metropolitan areas or metropolitan divisions upon request. Measures of 
sampling error for states down to the supersector level are available on the 
BLS website at www.bls.gov/sae/790stderr.htm. Measures of nonsampling error 
are not available for the areas contained in this release. Information on 
recent benchmark revisions is available online at www.bls.gov/sae/. 

Area definitions

   The substate area data published in this release reflect the
standards and definitions established by the U.S. Office of Management
and Budget on December 1, 2009. Data reflect New England City and Town
Area (NECTA) definitions, rather than county-based definitions, in the
six New England States. A detailed list of the geographic definitions is
available at www.bls.gov/lau/lausmsa.htm.

Additional information
  
   More complete information on the technical procedures used to
develop these estimates and additional data appear in Employment and
Earnings Online.
   
   Estimates of unadjusted and seasonally adjusted labor force and
unemployment data for states, census regions and divisions, and seven
substate areas are available in the news release, Regional and State
Employment and Unemployment. Estimates of labor force and unemployment
for all states, metropolitan areas, labor market areas, counties, cities
with a population of 25,000 or more, and other areas used in the
administration of various federal economic assistance programs are
available on the Internet at www.bls.gov/lau/. Employment data from the
CES program are available on the BLS website at www.bls.gov/sae/.
   
   Information in this release will be made available to sensory impaired 
individuals upon request. Voice phone:  (202) 691-5200; Federal Relay 
Service:  (800) 877-8339.



Table of Contents

Last Modified Date: October 01, 2014
Recommend this page using: