How the Department of Labor creates these projections

These projections are the product of four steps:

Step 1: Project industry employment

Data from the Quarterly Census of Employment and Wages are used to determine the number of jobs for each industry during the first year, or “base year,” of the projection period.1 Certain types of public-sector employment — such as education, hospitals, rail transportation, and U.S. Postal Service — are combined with employment in private-sector industries.

The department creates projections for each industry based on historical trends and expected economic changes, Alaska and U.S. population projections, and other industry-specific variables. The projections also take into account any knowledge of specific projects and observations of the current economic climate.

Step 2: Determine the occupational makeup, or “staffing pattern,” of each industry

To estimate base year employment for each occupation, the department determines the occupational “staffing pattern” of each industry Most industries have a wide variety of occupations. The staffing pattern is the breakdown of each occupation’s share of the industry’s total employment, referred to as “staffing ratios.”

Employers in Alaska report the occupations of their workers when they submit their unemployment insurance quarterly contributions report. The reported occupations are the basis of Alaska’s Occupational Database (ODB). An analysis of the three most recent years of ODB data are used to calculate occupational staffing ratios for the majority of industries. Since the ODB does not include federal government workers, staffing ratios were developed using occupation data from public and private industries closely related to individual federal divisions or agencies. For example, for civilian employment from army commissaries, staffing patterns for Other General Merchandise Stores (NAICS 452900) was used. Anecdotal information or survey data was also used as available.

Step 3: Calculate base year and projected occupational employment

For each occupation, the department multiplies each industry’s estimated base year employment by the staffing ratio, then sums the results to get the base year estimate.

For the projections, adjustments to staffing ratios within an industry are called “change factors.” Change factors are multipliers that increase or decrease an occupation’s estimated share of industry employment based on factors other than an industry’s projected employment change. Some examples are changes in consumer demands, technology, or business practices.

Each industry’s projected employment is then multiplied by the adjusted staffing ratio for each occupation, with the results summed by each occupation to get the projections.

Step 4: Estimate job openings

Job openings for an occupation result from both job growth and replacements of workers who leave. An occupation’s growth openings are equal to its positive change over the projection period. Estimates of replacement openings use a combination of Bureau of Labor Statistics formulas and formulas derived from an analysis of historical ODB data.


Footnotes:
1/ Estimates and projections do not include self-employed workers, private household workers, most agricultural workers and fishermen, and others who are not covered by the state’s unemployment insurance program.