Estimating population change with a two-category shift-share model

Abstract

Shift-share analysis is an accounting procedure that identifies three separate effects for regional employment change. But the analysis is ordinarily restricted to only one category: usually, industry employment. This paper presents a new shift-share model that simultaneously addresses both occupation employment and industry employment. Community-level occupation-in-industry employment effects (both mix and competitive) occurring in the 1980s are then used to estimate population change in the 1990s. Separate estimates are given for two data sets comprised of different-sized non-metropolitan U.S. communities – small towns and micropolitan centers. This expanded two-category model is shown to generate estimates that are clearly superior to those of the traditional one-category model.