Category: Economy

Inclusive Economic Development in Albuquerque

New leadership at the Albuquerque Economic Development Department is refocusing efforts on local, small businesses and the City’s large population of people of color.

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Making Metro-to-Metro Partnerships Work

Creating a global partnership in name can be easy – two cities from different countries have photo ops with leaders shaking hands or news stories touting the new alliance – but making those partnerships produce real economic benefits can be difficult.

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Which is Better: Place-Based Policies or People-Based Policies?

Research finds merit in both place-based policies, economic policy that improves the economy of a location, and people-based policies, economic policy that helps people move to more prosperous areas with better jobs and quality of life. But which is more effective?

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Who Should Fix Rural Economies, State or Local Government? (Both!)

Governors are seeking to revitalize the rural areas in their states, but the differences in rural areas, from different target industries, population sizes, amenities, and more, it’s hard for states to formulate one solution.

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Know Your Labor Shed

By John Rees, Research Director, Avalanche Consulting

The national unemployment rate recently plunged to its lowest level in 50 years. The last time national unemployment was at its current rate, Nixon had just assumed the presidency, Led Zeppelin had just released its debut album, and the world’s first wide-body airplane, Boeing’s 747, had just recently taken flight. While low unemployment is cause for celebration of economic success, talent shortages across most communities in the US means that companies can’t find the workers they need to grow. With employers scrambling to find workers, economic development professionals are increasingly asked to identify pools of potential labor. Firms looking to increase existing operations or invest in new facilities, for example, must be assured that there is a sufficient workforce to support expanded operations. In such instances, a labor shed analysis can serve as an invaluable informational tool.

While several private data vendors produce detailed labor shed models, the US Census Bureau’s Longitudinal Employer-Household Dynamics (LEHD) On the Map program empowers anyone to examine local commuting patterns. The On the Map tool combines unemployment insurance records with corporate administrative information to capture the workplace destination of individual workers in all 50 states. The data set covers more than 95% of the private sector workforce. The On the Map website allows users to select virtually any geography (city, metropolitan area, state, etc.) and view the employment destination of area residents as well as the geographic origin of examined workers. Users can also explore demographic characteristics of the local workforce, including information on wages, industry composition, age, and educational attainment levels.

As impressive as the On the Map program might be, the data does come with several important caveats. Perhaps most frustratingly, On the Map’s most recent information is from the year 2015. As commuting patterns evolve at a relatively slow pace, however, the information remains relevant to today. Additionally, the On the Map data can misclassify the work location of employees employed by large companies with multiple locations. This dynamic can be especially extreme for corporate headquarters. For example, the On the Map program may assign an artificially high number of Apple workers at your local mall to the Cupertino campus in California. Despite these limitations, the program provides a remarkable comprehensive portrait of American commuting patterns. 

All which begs the question, how can you make the best use of this information? For outlying suburban locations, the results can be transformational. As traditional employment statistics only capture workers at their place of employment, bedroom communities are often home to substantial levels of hidden talent. On the Map data can highlight available labor that is too often missed. Conversely, employment centers may attract talent from a surprisingly large geography. A labor shed analysis can help pinpoint the dimensions of this area and help employers better understand the true depths of available talent. Finally, integrating commuting data with wage information can help reveal why employers are unable to attract workers from areas seemingly ripe for attraction efforts. Specifically, local wages may not be sufficiently competitive to entice prospective workers to commute long distances. 

While there’s no silver bullet in addressing workforce shortages, crafting a sophisticated labor shed analysis can complement other efforts to ensure that local employers have access to the workers necessary to thrive. 

The One the Map data is a good first step in a labor shed analysis. If your community needs more in-depth insights or a strategy on what to do about your labor shed findings, please contact us. We’re here to help!

How the Midwest Can Get More VC Funding

Despite being home to a number of great universities, lots of workers with bachelor’s degrees, and a quarter of patents filed in the US, the Midwest still only receives a fraction of the venture capital funding our country’s coastal hubs get.

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