Technical Note for Nonagricultural Wage
and Salary Employment/Hours and Earnings Estimates

Monthly employment estimates for New Jersey and its metropolitan areas historically have been developed by labor market analysts of the New Jersey Department of Labor and Workforce Development through a cooperative agreement with the United States Bureau of Labor Statistics (BLS). The estimates were based on a monthly survey of New Jersey businesses combined with analysts’ input and knowledge of New Jersey’s local economies. In March 2011, the responsibility for developing monthly estimates for New Jersey and for all other states is solely the responsibility of the BLS. The process for developing these estimates will rely less on local economic knowledge as input in the estimation process and may result in greater monthly volatility for industry employment numbers, particularly for New Jersey’s smaller metropolitan areas.

More detailed information on the changes to procedures for producing CES state estimates is available on the BLS web site at http://www.bls.gov/sae/cesprocs.htm.

Estimation Procedure

Preliminary monthly estimates are based on reports submitted by a sample of New Jersey employers.  The estimates are benchmarked each year based on more complete and accurate counts of data, which are obtained primarily from employer reports required by the State’s unemployment insurance system. Revisions due to the new 2010 benchmark have been made to statewide not seasonally adjusted estimates back to 2006. The employment data are grouped by industry according to the 2007 North American Industry Classification System (NAICS).

The Sum of Labor Areas Compared to Statewide (Not Seasonally Adjusted Series)

The sum of labor areas, not seasonally adjusted estimates, may not precisely equal the State total because each area estimate is independently computed.

Historical Comparability

Estimates of nonfarm payroll employment by industry, produced from the Current Employment Statistics (CES) program, were converted from the 1987 Standard Industrial Classification (SIC) system to the 2002 North American Industry Classification System (NAICS) in January 2003. The NAICS conversion resulted in major changes to most of the previously published SIC-based series in the private sector. The CES program converted to the NAICS 2007 industry coding structure in early 2008.

NAICS estimates are published at the supersector, sector and lower levels. The supersector level roughly corresponds to the division level breakout previously available under the SIC.

NAICS is a production-oriented approach to categorize industries as opposed to the SIC focus on the products or services produced. This approach yields significantly different industry groupings than under SIC. For example, the NAICS supersector industry information brings together businesses that turn information into a commodity with businesses that distribute the commodity and businesses that provide information services. Under SIC, these establishments would have been spread across manufacturing, communications, business services and amusement services. Other industries, while keeping the same name, such as manufacturing, differ significantly. Previously, a manufacturing headquarters was classified under SIC in manufacturing; in NAICS, it is classified under management of companies and enterprises, a NAICS service-providing sector. For this reason, manufacturing represents a smaller share of the economy under NAICS than under SIC.

Upon converting from the SIC system to NAICS, historical time series for not seasonally adjusted employment were reconstructed on NAICS-based classifications of industries. The reconstructed series run from 1990 until 2002. Starting with 2003, historical NAICS-based employment series are the result of applying CES procedures for monthly estimating and annual benchmarking. The complete historical record of employment series now runs continuously from 1990 until 2010. This information may be obtained from our website at http://lwd.dol.state.nj.us/labor/lpa. Hours and earnings data are available back to 2001.

With the introduction of the 2006 benchmark, series breaks that had existed in the historical employment series record for New Jersey and its substate areas from 1990 until 2002 were eliminated. (A series break is any lasting change in the estimated level of a time series resulting from a non-economic event such as an area redefinition or an industry coding error.) These breaks were mostly artifacts of the reconstruction process during the conversion to NAICS or due to area redefinition based on the 2000 Census, or a combination at the time both were implemented beginning with 2003 employment estimates.

Where known series breaks existed in the previous historical tables, they were notated to let the data user know that data prior to the break were not comparable to the data after the break. Under the policy of eliminating series breaks, the complete set of historical tables from 1990 now through 2010 reissued with the 2010 benchmark allows the user to make comparisons on a continuous basis over this period.

This new policy to eliminate breaks is a recommendation of the CES Policy Council to be adopted by all States, and it is comparable to the BLS policy in effect for the CES national series. Currently, BLS does not maintain any national CES series with breaks.

Seasonally Adjusted Series

Seasonally adjusted statewide estimates for supersector and sector nonfarm all-employee series have been revised back to January 1990 due to the introduction of revised seasonal factors that now incorporate employment changes through 2010.  Seasonally adjusted estimates are not available at this time for labor areas.

Users needing further information on these estimates should contact Dung Nguyen at 609.984.0103 or email: Dung.Nguyen@dol.state.nj.us , Users may also write to the following address:  N.J. Department of Labor and Workforce Development, Labor Market and Demographic Research, Current Employment Statistics, Labor Building, P.O. Box 935, Trenton, N.J.  08625. 

N.J. Department of Labor and Workforce Development
Office of Research and Information
Labor Market & Demographic Research
Bureau of Labor Force Statistics
Current Employment Statistics

February 2013