Urban Institute Business Patterns Data Set: Technical Documentation: Second Edition

Urban Institute Business Patterns Data Set: Technical Documentation 1 Urban Institute Business Patterns Data Set: Technical Documentation Second Edition December 2011 Beata Bajaj, Kathryn L.S. Pettit, and Randy R. Rosso The Urban Institute This document is an updated version of the “Business Patterns Data Set: Technical Documentation” by Beata Bajaj and Kathryn L.S. Pettit, published in November 2006. The Business Patterns data and the procedures for constructing them were initially developed by the Urban Institute to support www.DataPlace.org. This document is licensed under the Creative Commons Attribution Share Alike license (http://creativecommons.org/licenses/by-sa/3.0/). Urban Institute Business Patterns Data Set: Technical Documentation 2 Introduction In addition to a wide selection of demographic, housing, and mortgage lending data, the Urban Institute (UI) National Data Repository includes key economic indicators from the U.S. Census Bureau’s Business Patterns data series. Business Patterns data are available for ZIP Codes, cities, counties, and larger geographic entities, enabling users to learn about the changing spatial patterns of economic activity in their communities and regions. The data files and the procedures for constructing them were initially developed by the Urban Institute to support DataPlace. The data are licensed under the Open Database License (ODbL). This document describes the Business Patterns series source data set and the summary indicators from this set that are included in the UI data file. It also discusses technical issues associated with preparing the Business Patterns data. A companion analytic brief, Business Patterns and Trends: National Summary, is available at http://www.urban.org/publications/412248.html. Description of Business Patterns Source Data Set1 The U.S. Census Bureau’s Business Patterns series is produced annually and provides subnational economic data by industry. The series is useful for studying the economic activity of small areas; analyzing economic changes over time; and benchmarking statistical series, surveys, and databases between economic censuses. The Business Patterns series provides information on number of establishments, employment, and payroll. (The UI file includes data based on only the first two of these categories.) An establishment is a single physical location at which business is conducted or services or industrial operations are performed. It is not necessarily identical with a company or enterprise, which may consist of one or more establishments. When two or more activities are carried on at a single location under a single ownership, all activities are generally grouped together as a single establishment. The entire establishment is classified on the basis of its major activity, and all data are included in that classification. Establishment counts in the Business Patterns series represent the number of locations with paid employees at any time during the year. The Business Patterns series also provides data on paid employment for full- and part-time employees, including salaried officers and corporate executives on payroll in the pay period including March 12. Employees on paid sick leave, holidays, and vacations are included; proprietors and partners of unincorporated businesses are excluded. Self-employed individuals, employees of private households, railroad employees, agricultural production employees, and most government employees also are excluded. 1 Descriptions of the Business Patterns series, data content, and industrial sector coverage are based closely on U.S. Census Bureau, County Business Patterns: United States: 2002, CBP/02-1, issued November 2004. Urban Institute Business Patterns Data Set: Technical Documentation 3 Data Collection The Census Bureau extracts the Business Patterns data from the Business Register, a file of all known single- and multi-establishment companies. The Annual Company Organization Survey and quinquennial Economic Censuses provide individual establishment data for multi-location firms. Data for single-location firms are obtained from various programs conducted by the Census Bureau, such as the Economic Censuses, the Annual Survey of Manufacturers, and Current Business Surveys, as well as from administrative records of the Internal Revenue Service, the Social Security Administration, and the Bureau of Labor Statistics. Industry Sector Classification and Coverage Industry sector classifications of Business Patterns data currently are based primarily on the North American Industry Classification System (NAICS).2 The Business Patterns series includes the NAICS sectors listed in table 1. (Groupings of NAICS sectors used in our summary file are described below under “Business Patterns Data in the UI National Data Repository.”) Table 1. NAICS Sectors Included in Business Patterns Data Sector Description 11 For