Data Sources and Limitations for QCEW - Data Sources and Limitations for QCEW
Data Sources and Limitations
for Employment and Wages By Industry (QCEW)
Nature and Limitations of the Data
The information published in Employment and Wages by Industry (QCEW) is based on unemployment insurance tax reports submitted quarterly by employers subject to Employment Department law. Employment is reported by each firm for each month using the payroll period that includes the 12th of each month. For example, if a company pays its employees twice a month – on the 15th and the 30th – the employment reported would be the number of employees who worked during the first payroll period of each month.
Wages are reported for the entire quarter, and are the sum of all pay periods for each of the three months in the quarter. The annual average wage is the total of all covered wages paid during the year divided by the monthly average number of covered jobs during the year. Wages include tips, commissions, bonuses, vacation, and holiday pay, but do not include benefits. Most employees are included in these QCEW records, but notable exceptions include the self-employed, workers paid solely by commission, and some agricultural workers.
Employment and payroll data are ordinarily classified on the basis of the primary business activity and physical location of the employer in Oregon. Employers operating at more than one location in Oregon must report employment and payroll by each location, and each location is classified according to its primary activity and physical location. This detailed level of reporting makes it possible to identify and publish employment and wages in the area in which the work takes place and where economic impact of the jobs is the greatest. Summary level employment and payroll data in this publication are based on county and North American Industry Classification System (NAICS) codes assigned by the Oregon Employment Department.
Two changes that impact how we can publish data or data available to be published took effect in 2005. The law governing what we can publish was changed to allow us to publish the number of establishments in an industry regardless of how many establishments there are in that industry. Previously, if there were fewer than three establishments, we could not publish any information. Employment and wage data for those industries where there are fewer than three establishments is still classified as confidential.
The second change has to do with state employment data and home care workers (see section on changes in unemployment insurance coverage). Adding home care workers into the state worker totals has a significant impact on the count of state workers and their wages. (Most home care workers are part-time positions.) A more accurate calculation of the number of state workers and their wages can be made by subtracting out the employment and wages reported under NAICS industry 624120 from statewide totals.
Data presented in this report include employment and wages covered by Oregon Employment Department law and by the program of Unemployment Compensation for Federal Employees (UCFE). Employment and wage data on interstate railroad workers, who are covered under a separate unemployment insurance law administered by the Railroad Retirement Board, are not included in this report. Also excluded from the report are:
- Agricultural labor performed for a farm with a quarterly payroll of less than $20,000 or not employing at least 10 persons in each of 20 separate weeks during any calendar year.
- Domestic service in a home, sorority or fraternity, providing the quarterly payroll at no time exceeds $1,000.
- Casual labor not in the course of an employer's trade or business.
- Service performed as an officer or member of the crew of any American vessel primarily engaged in interstate, foreign, or high seas navigation, which does not maintain an office within Oregon from which the operations of the vessel are regularly managed and controlled, and service performed on any vessel of foreign registry. Officers and crews of vessels engaged in inland navigation on the Willamette and Columbia Rivers are covered.
- Service performed by a person in the employ of a son, daughter, or spouse, and service performed by a child under the age of 18 in the employ of his father or mother.
- Service performed by certain part-time, irregular and emergency employees of state or local government.
- Service performed by elected officials.
- Service by an appointed policymaking official of state or local government provided he or she works less than eight hours a week.
- Service performed by an individual in the delivery of newspapers or shopping news.
- Service performed by a real estate broker, real estate salesman, real estate agent, insurance agent, insurance solicitor or securities salesperson to the extent that compensation is solely by commission.
- Service performed by an individual or partnership in the distribution of petroleum products with remuneration for service primarily consisting of the difference between the amount the individual pays or is obligated to pay for the petroleum products and the amount the individual receives.
- Commission sales of home improvements and in-home sales of consumer goods.
- The 1999 Legislature passed legislation that impacted a certain segment of the fishing industry. Effective October 23, 1999, House Bill 3308 excluded from unemployment insurance fishing services performed by workers on boats with crews of less than 10 individuals where the payment is based on the share of the catch.
- Wages paid to corporate officers of closely held family corporations may elect to exclude from UI coverage those corporate officers who are directors of the corporation, have a substantial ownership interest in the corporation and are members of the same family.
Time Series Analysis
Limiting Factors in Year-To-Year Comparisons
Probably the most valuable use of the data printed in this publication is the ability they give the user to observe year-to-year trends of Oregon employment. However, there are certain restrictions that make strict year-to-year comparisons misleading or impossible. Technical changes in the unemployment insurance program, changes in the industrial classification system, or OED's ongoing review of assigned industry and location codes can sometimes cause the appearance of gains and losses in employment and wage tables. Such changes do not accurately reflect changes in the structure of Oregon's economy and as such may limit the legitimacy of year-to-year comparisons of data. This should be kept in mind when analyzing employment and payroll trends over many years.
Noneconomic Code Changes
The primary causes of noneconomic changes in employment and wages are industry or county reclassifications and/or changes in the level of employer reporting. Since these changes are not directly attributable to economic activities, they are referred to as noneconomic changes. Summary tables of noneconomic code changes are made available at the back of this publication.
An annual refiling survey that reviews industry, location and other demographic identifiers is the major source of noneconomic code changes. One-third of all Oregon employers are surveyed each year with the changes incorporated in the publication the following year. Beginning with the 1998 survey cycle, the selection criteria for the tri-annual survey of employers was changed. The criteria for selection is now based on the sixth and seventh digits of the Federal Employer Identification Number (EIN) assigned to each employer. Studies done by the Bureau of Labor Statistics (BLS) in conjunction with the states determined that using these two digits of the EIN resulted in a statistically valid random sample of employers' current industry classification. An added benefit to those employers doing business in multiple states is that they receive survey forms only once every three years rather than some survey forms from different states each year (if the industrial activity for the company differed from one state to another).
Changes in the level of detail reported by some employers is the other primary cause of noneconomic employment and/or wage variations. Beginning in 1989, BLS, in conjunction with the states, initiated the Business Establishment List (BEL) project to obtain a more accurate representation of employment at the local level. As a result, employers that operate in more than one location and have at least 10 employees outside their primary location are required to report employment and payroll by separate location. When the county or industry code of the individual location is different than the master account, the effect on the data is the same as the industry reclassifications described above. The incorporation of establishment based reporting was, for the most part, a one-time, two-year process. Thus, 1989 and 1990 had a greater than usual number of employment and payroll shifts that were due to reclassifications.
NAICS manual revisions, which occur every five years, are a third source of noneconomic code changes. Industry code changes resulting from the most recent (NAICS 2017) manual revision are introduced beginning with the first quarter of 2018.
Changes in Unemployment Insurance Coverage
The following is a list of coverage changes with the year such changes were made effective. Unless noted, changes became effective January 1.
- 1936 – Oregon covered employment data included only employment and payrolls of private industry employers hiring four or more persons.
- 1956 – Coverage was extended to private firms hiring two or more employees and to employees of federal government installations.
- 1958 – State government workers were added to covered employment totals.
- 1960 – Coverage was extended to all private industry employers with one or more employees.
- 1972 – Employees of nonprofit institutions other than religious and primary and secondary schools, share-of-the-catch fishermen, employees of commercial plants engaged in handling, grading, shipping, etc., of farm commodities, and faculty members of Oregon higher education were covered.
- 1974 – Coverage was extended to include local government.
- 1978 – Some farm workers and domestic employees were added as well as coverage of primary and secondary private schools. The coverage of agricultural and domestic employment was limited by size of payroll and/or number of employees. At the same time, the exemption of commission sales was expanded to exclude all in-home sales.
- 1987 – The Oregon Legislature introduced two minor changes. Food product demonstrators not employed by the product manufacturer, distributor or retailer were excluded. Also excluded was transportation performed by motor vehicle for a certified common carrier by any person who leases their equipment to a certified common carrier and who personally operates, furnishes and maintains the equipment.
- 1989 – All churches and religious organizations must provide unemployment insurance for all lay employees. Members of the clergy remain exempt.
- 1995 – Closely held family corporations are granted the option to exclude from UI coverage payments for services to corporate officers who are directors of the corporation, have a substantial ownership interest in the corporation and are members of the same family. Effective with the first quarter of 2004, the legislature expanded the definition of members of the same family.
- 1996 – Members of the clergy and religious organizations, formerly exempt, are now covered beginning with fourth quarter, 1996, quarterly tax reports.
- 1999 – Fishing services performed by workers on boats with crews of less than 10 individuals where the payment is based on the share of the catch are no longer covered beginning with fourth quarter, 1999 tax reports.
- 2005 – Changes made by the Oregon Legislature resulted in the reporting of Home Care Workers as state employees for Unemployment Insurance reporting purposes only. Inclusion of these workers has a significant impact on state employment statistics.
- 2016 – Public universities in the state of Oregon were previously classified under state government ownership. In 2011 and 2013 state legislation was passed which created a new legal entity called “universities with governing boards.” Public universities in Oregon were reorganized in 2014 and 2015 under this new legal entity and they are now independent public bodies. Beginning with data for the first quarter of 2016, these establishments are now classified in local government ownership. The industry classification for these institutions has not changed.
- 2018 – Beginning with the first quarter 2018 home care workers are now classified as private sector employees for Labor Market Information purposes. Home care workers paid through the Oregon Department of Human Resources, Seniors and People with Disabilities (DHS SPD) were previously classified as state workers for Unemployment Insurance purposes only.
These changes present difficulties in the analysis of time series data. If, in your analysis, something appears unusual, or you simply wish to confirm your conclusions, please feel free to contact the Workforce and Economic Research Division of the Oregon Employment Department. We will be glad to assist where we can.
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