Arizona Community Economic Base Studies -- Data Sources and Methodology
National and state economic data were obtained from the latest edition (2001 data released in 2003) of County Business Patterns, which is produced annually by the U.S. Department of Commerce’s Census Bureau. Data for the cities/towns came from a companion product of the Census Bureau, Zip Business Patterns; in which zip codes were combined to approximate the city/town.
County Business Patterns and Zip Business Patterns use the hierarchical North American Industry Classification System to provide data by industrial category: broad sectors, subsectors, industry groups, and specific industries. Agricultural production employees, most government employees, railroad employees, self-employed individuals, and employees of private households are not included in either Census Bureau report.
The number of establishments (by employment size: 1 to 4, 5 to 9, 10 to 19, etc.), employment, and payroll are reported in County Business Patterns by industrial category. An establishment is a physical location at which business is conducted; a company may consist of one or more establishments. When only a small number of establishments are present in an industrial category (particularly if one establishment within the category is dominant), the Census Bureau withholds the employment and payroll data to protect company confidentiality. Undisclosed data are most frequent at the industry level, but in less populous areas even sectoral data may be withheld. Unlike County Business Patterns, employment and payroll data are released only for the zip code total in Zip Business Patterns.
For industrial categories for which data were not disclosed (including all categories at the city level), employment by sector, subsector, industry group, and industry had to be estimated. For each city/town, these estimates were made using the establishment by employment-size class data for each industrial category for each zip code and average employment per establishment by employment-size class by sector for the state. The estimates by industrial category for each of a city/town’s zip codes then were forced to add to the total employment of the zip code.
The data from Zip Business Patterns were supplemented by estimates of employment in the agriculture and government sectors. No source of either agriculture or government employment by zip code or city exists.
The agriculture sector has two major parts: agricultural production (farms and ranches), and agricultural support, which consists of such activities as cotton ginning and crop harvesting. Forestry, logging, fishing, hunting and trapping activities also are included in the agriculture sector. Zip Business Patterns includes only a portion of the agricultural support category.
Agriculture employment at the county level is available for 2001 from the U.S. Bureau of Economic Analysis (BEA), divided into the categories of farm proprietors, farm workers, and agricultural support and other agricultural employment. Some figures had to be estimated in some counties because of the federal government’s disclosure restrictions. The county totals were allocated to cities and unincorporated areas within each county by a combination of methods.
To estimate farm and ranch employment in cities and unincorporated areas, the number of farms and ranches by zip code from the 1997 agricultural census (the 2002 census data are not yet available) of the U.S. Department of Agriculture were used. The zip code data were found to be incomplete, with some farms assigned to incorrect zip codes, when the sum of the zip code data by county was compared to the county total provided separately by the Department of Agriculture. Thus the zip code data were adjusted to sum to the county total. Only those farms and ranches with agricultural sales of at least $10,000 in 1997 were included, but even some of these farming operations likely do not provide the main source of income for their owners, much less employ others. Thus, average employment (proprietors and farm laborers) per farm and ranch was only 6.6 in Arizona (calculated as 2001 employment divided by the number of farms and ranches in 1997). In each county, average employment per farm and ranch was multiplied by the number of farms and ranches in each city/town or unincorporated area. The city/town and unincorporated county estimates were adjusted in some counties if farming operations with significant employment were reported by local sources in particular communities.
County employment in agricultural support and other agricultural activities reported by the BEA were allocated to cities and unincorporated areas using the ratio of BEA agricultural support employment to the agricultural support employment included in Zip Business Patterns.
For this report, the government sector was divided into several levels of government: federal (including civilian and military), state, county, municipal or tribal government, school district, and special district (such as an irrigation or fire district). Universities and community colleges are shown as a separate category; depending on the source of government data, they may be included either in state government or as a school district. The inclusion of all or a portion of tribal operations in government varies by source of data.
Several methods had to be used to estimate government employment by city and unincorporated area. The 2002 Census of Governments provides employment by level of government, but does not allocate that employment by community if the government entity crosses jurisdictional boundaries. For example, it provides no indication of federal government employment in Arizona and provides only the overall state government figure (which includes universities). Community colleges are included as a school district and tribal government is not included.
The census figures were used as the starting point for school district employment, special district employment, municipal employment, and county employment. If a school district extends across city boundaries, Arizona Department of Education employment data by individual school were used to allocate the overall school district employment by city. Most of the community colleges have multiple campuses. Data on employment at each campus was collected from the community college district office, and used to allocate the overall community college employment by community.
While most county government employment is located within the boundaries of the county seat, county offices commonly are found in other communities as well. Generally, county governments in Arizona could not provide employment by location, so county offices outside the county seat were individually contacted to obtain employment. In most counties, employment in the county seat was calculated as the difference between the county total from the 2002 census and the number tallied in other locations. This process probably understates county government employment outside the county seat and overstates it at the seat.
State government employment figures by city also are not available. County totals for 2001 were obtained from the Arizona Department of Administration (DOA). State offices were contacted across the state to obtain employment, but in most counties it was not possible to identify all of the county employment reported by the DOA. In these counties, each community’s estimate was increased so that the sum of state employment by community equaled the DOA county total.
Military employment figures at each of the major facilities were obtained from the May 2002 report “Economic Impact of Arizona’s Principal Military Operations,” prepared by the Maguire Company. Smaller military facilities were contacted directly. Similarly, federal civilian employment was collected directly from local federal offices. Like state government, it was not possible to identify all federal workers by this process. The community estimates were increased to sum to the 2001 BEA county totals.
Complete economic data for all cities/towns are available in an EXCEL file consisting of two spreadsheets. The first sheet provides the number of establishments by employment-size class for those sectors, subsectors, industry groups, and industries with at least one establishment in the city/town. Estimated employment also is shown.
The second spreadsheet compares employment in the city/town to that in Arizona and the nation. All sectors, subsectors, industry groups, and industries are included. For the United States, Arizona, and the city/town, per capita employment (expressed as employment per 1,000 residents) is calculated for each industrial category. The per capita figures for the city/town (and Arizona) are divided by the national average for each industrial category to create the location quotient. For industrial categories with location quotients greater than 1, excess employment in the city/town (and Arizona) is calculated from employment and the location quotient. For each city/town, the location quotient and excess employment by industrial category also is calculated relative to the Arizona average