Examining industry composition effects in state employment

Abstract

Using Current Employment Statistics data, this article examines employment for all 50 states and the District from 2007 to 2016 to determine whether an industry composition effect slowed the post-Great Recession recovery of six states—Alabama, Connecticut, Mississippi, New Mexico, West Virginia, and Wyoming. The industry composition of these states was analyzed first at a macrolevel (from goods producing to service providing) and then at a more detailed industry supersector level. Based on industry shares over a decade, the industry composition of the six states that were slower to recover was little different from the composition of the states that did recover. However, the six states had higher rates of employment in goods-producing industries before the recession and higher rates of employment in service-providing industries following the recession.