Useful Stats: Examining county-level employment and establishments by sector

Understanding the composition of local economies requires looking beyond broad statewide or national trends. County-level data reveals the unique mix, or lack thereof, of industries and businesses in each area. Policy makers, by identifying which sectors drive employment and business activity within a locality, can influence the impact and design of regional innovation strategies to reflect local realities and potential.  

The U.S. Bureau of Labor Statistics’ Quarterly Census of Employment and Wages (QCEW) allows examination of county-level employment and establishment counts across all private sectors at the 2-digit NAICS level. In this article, SSTI uses annualized private sector data for all provided 2-digit NAICS sectors at the county level for 2015 and 2024.  

The QCEW provides annualized counts of employment and establishments reported by employers, among other useful data. The dataset is comprehensive, covering more than 95% of U.S. jobs, but, due to its specificity, it also leaves much data undisclosed when viewed at the county level. The dataset has several limitations and should be interpreted with caution. For more detail, refer to the Data Limitations section at the end of this article.

A brief analysis of the data

Figure 1, below, consists of four maps which showcase the following for each county: the sector with the highest employment levels; the sector with the second highest employment levels; the sector with the highest establishment count; and the sector with the second highest establishment count.

It is very important to remember that much of the data from the QCEW is withheld to protect the anonymity of individual firms, thus making it important to interpret the data with great caution. There is a chance that, for example, one very large establishment may exist in a county, which would immediately make it clear where much of its employment is; if this establishment’s data were to be withheld, it may affect the maps within Figure 1.

From the figure below, sectoral clustering can be seen. For example, manufacturing employment is dominant around the Great Lakes region and much of the area to its south. Refer to the figure to see these trends and more. 

Figure 1: Private two-digit NAICS sector employment and establishment metrics, 2024

Next, data is broken down by sector with specific employment and establishment data. This breakdown is key, as knowing which counties have high or low employment or establishment counts within certain sectors of interest can help target limited regional innovation tools more effectively.

Exploring employment and establishment counts independently is a good way to get a feel for a region; however, considering both concurrently may also provide important insights. Counties with relatively few establishments but high employment may indicate the presence of large establishments dominating local economies, while counties with many smaller establishments but a more moderate employment count may indicate a more diversified business landscape. These distinctions impact regional strategies, as areas dominated by a single large employer often differ from those in regions with more small businesses.

Figure 2, below, maps the county-level annual average employment and establishment counts for 2024, the most recent year of available data. By default, the figure shows employment data with a dropdown for each sector. Using the arrows in the top right of the figure toggles the figure to show establishment data. 

Figure 2: Private two-digit NAICS sector annual average employment and establishment counts, 2024  

While looking at the current data establishes an important baseline, it lacks the context of change. The remainder of this article explores how employment and establishment counts have changed over time. Specifically, SSTI examines the past 10 years of data, comparing 2015 and 2024, to paint a more comprehensive picture.

Figure 3, below, shows the 10-year percentage change in private sector employment and establishments (via the arrows in the top right of the figure), with gains shaded in blue and declines in red. Note that to provide a clearer and less skewed view of the data, SSTI has limited the color scale to 200% growth despite some counties surpassing the threshold. Hovering over or clicking on any county will show its value. 

Figure 3: 10-year percentage change in private two-digit NAICS sector average annual employment and establishment counts, 2015-2024

The QCEW breaks down data far beyond the 2-digit NAICS level. For example, SSTI has previously covered the QCEW data at the 3-digit NAICS subsector level detailing the manufacturing sector over the past decade of available data. Those interested can read the article here.

Data limitations    

Note that the QCEW employment data used are calculated as the annual average of the number of covered workers who either worked during or received pay for the pay period, including the 12th day of the month. Some employment exclusions apply, such as proprietors and unpaid family members; refer to the QCEW overview for more detail.  

In addition to counties or county equivalents, the QCEW data set includes “Unknown or Undefined” geographies as catchalls for each state. These often account for sizable counts of employment and establishments and may cause certain counties to be underrepresented in the dataset.  

Due to the small geographic scale of the data used, some data are excluded from the QCEW dataset to protect the confidentiality of firms. The impact of these exclusions is difficult to estimate and likely affect many of the multi-year comparisons within this article. Data for many counties or county equivalents are also likely underrepresented due to these necessary exclusions. Impacted data are marked with a disclosure code in the data set. SSTI encourages those interested to refer to the data notes in the source for details on counties that may be affected.  

SSTI has included in this articles’ visuals counties with at least one establishment, but no employment, but excluded counties with zero establishments and zero employees.  

This page was prepared by SSTI using Federal funds under award ED22HDQ3070129 from the Economic Development Administration, U.S. Department of Commerce. The statements, findings, conclusions, and recommendations are those of the author(s) and do not necessarily reflect the views of the Economic Development Administration or the U.S. Department of Commerce.