Economic News Release

Regional and State Unemployment, 2013 Annual Average Technical Note

Technical Note

   This release presents labor force and unemployment data for census regions
and divisions and states from the Local Area Unemployment Statistics (LAUS)
program. The LAUS program is a federal-state cooperative endeavor.


   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 house-
holds 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 noninstitu-
tional 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-manage-
ment 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 unemploy-
ment rate is the number of unemployed expressed as a percent of the labor
force. The employment-population ratio is the proportion of the civilian
noninstitutional population 16 years of age and over that is employed.

   Method of estimation. Estimates for 48 of the 50 states, the District of
Columbia, the Los Angeles-Long Beach-Glendale metropolitan division, New York
City, and the balances of California and New York State are produced using
estimating equations based on regression techniques. This method, which under-
went substantial enhancement at the beginning of 2005, utilizes data from
several sources, including the CPS, the Current Employment Statistics (CES)
survey of nonfarm payroll employment, and state unemployment insurance (UI)
programs. Estimates for the State of California are derived by summing the
estimates for the Los Angeles-Long Beach-Glendale metropolitan division and
the balance of California. Similarly, estimates for New York State are derived
by summing the estimates for New York City and the balance of New York State.
Estimates for all nine census divisions are based on a similar regression
approach that does not incorporate CES or UI data. Estimates for census
regions are obtained by summing the model-based estimates for the component
divisions and then calculating the unemployment rate. Each month, census
division estimates are controlled to national totals; state estimates are
then controlled to their respective division totals. Estimates for Puerto Rico
are derived from a monthly household survey similar to the CPS. A detailed
description of the estimation procedures is available from BLS upon request.

   Annual revisions. Labor force and unemployment data for prior years reflect
adjustments made at the end of each year. The adjusted estimates incorporate
updated population data from the U.S. Census Bureau, any revisions in the
other data sources, and model reestimation. The population data (except for
Puerto Rico) reflect, for the first time, the results of the 2010 Census. In
most years, historical data for the most recent 5 years (both seasonally
adjusted and not seasonally adjusted) are revised near the beginning of each
calendar year, prior to the release of January estimates. Though the labor
force estimates are changed for 5 years, the population estimates are adjusted
back to the new decennial estimates base of April 2010.

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. In table 1, level estimates for states may not sum to level
estimates for regions and divisions because of rounding. Unemployment rates
and employment-population ratios are computed from unrounded levels and thus
may differ slightly from rates and ratios computed using the rounded level
estimates displayed in table 1.

   Use of error measures. In 2005, the LAUS program introduced several
improvements to its methodology. Among these was the development of model-
based error measures for the monthly estimates and the estimates of over-
the-month changes. Annual average model-based error measures became avail-
able for the first time after 2006. The introductory section of this release
preserves the long-time practice of highlighting the direction of the move-
ments in regional and state unemployment rates and employment-population
ratios regardless of their statistical significance. The remainder of the
analysis in the release--other than historical highs and lows--takes statis-
tical significance into consideration. Model-based error measures are avail-
able online at BLS uses 90-percent confidence
levels in determining whether changes in LAUS unemployment rates or employment-
population ratios are statistically significant. The average magnitude of the
over-the-year change in an annual state unemployment rate that is required in
order to be statistically significant at the 90-percent confidence level is
about 0.5 percentage point. The average magnitude of the over-the-year change
in an annual state employment-population ratio that is required in order to
be statistically significant at the 90-percent confidence level is about 0.6
percentage point. Measures of nonsampling error are not available.

Additional information

   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: February 28, 2014
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