Shift stock
National Growth Rate x Number of Regional Industry Jobs= National Growth Effect To measure the national growth effect, we simply multiply the growth rate of the overall economy to the number of jobs in your region that are part of the industry. These phenomena can be explained by competitive effect (see below). It’s important to remember, however, that sometimes one of these “boats” (which are industries, in this case) may be pulled down deeper in the water, or may be experiencing higher tides on its own. This rising and falling is the national growth effect. If the tide begins to rise, each boat will rise with the tide–just as each boat will lower when the water lowers. This is sometimes explained as “the rising tide that lifts all boats.” Imagine several boats floating near the shore. So if the industry sees national net job growth, you can expect to see job growth in most regions within the country as well. National Growth Effect – The national growth effect shows the number of jobs an industry is expected to gain or lose according to the industry’s national job growth.Industry Premium x Number of Regional Industry Jobs = Industrial Mix Effect This rate (a percentage) is then applied to the number of the industry’s regional jobs: Industry Growth Rate – National Economy Growth Rate = Industry Premium This gives us a national industry premium which is an indication of how much that industry outperformed or underperformed the economy as a whole nationwide. We start by subtracting the national growth rate of the overall economy from the national growth rate of the specific industry. Industrial mix effect is calculated by applying the job growth of the industry at the national level to the same industry at the regional level. If the industry is growing or declining at the national level, it can dependably grow or decline in smaller regions.
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Industrial Mix Effect – The industrial mix effect is the number of jobs we would expect to see added (or lost) within an industry in your region, based on the industry’s national growth/decline.Note: For the following definitions and example, we will use shift share analysis at the industry level, but note that it can also be done at the occupation level. Shift-share analysis includes four components: (1) industrial mix effect, (2) national growth effect, (3) expected change, and (4) regional competitive effect.
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In this article, we’ll define the four components of shift-share analysis, and then show you how to apply it. But if it grew more than it did across the nation, this means the industry is probably growing due to your region’s particular strengths, and indicates that it is a competitive industry for your region. If the industry grew roughly the same in your region as it did nationally, it might not be particularly competitive, because it stands to reason that it’s growing in your region simply because it is growing everywhere. Based on this national growth, it then calculates how much the industry is likely to grow in your region, and compares this estimation with how much the industry actually grew. Shift share shows you the national growth (in terms of jobs) of a particular industry. Shift share is an economic indicator that tells you which industries (or occupations) are competitive in your region. Shift share can be found in the Industry Table, Occupation Table, and Program Table in Analyst.