The JQI analyzes a representative sample of the economy using production and non-supervisory job (P&NS) data from 180 different industry groups spanning across all 20 super-sectors into which the BLS groups establishments. The principal data utilized is contained in the Current Employment Survey (CES, also often referred to as the establishment survey) P&NS data on average weekly hours (AWH), average hourly wage (AHW) and total employment for each given industry group (seasonally adjusted, in all cases). The JQI is updated on a monthly basis contemporaneously with the release of new CES data from the BLS.
The JQI establishes a Quality Job Benchmark for each given month. The benchmark value is indicated by the average weighted weekly wage within the set of 180 industry groups, and weighted for the number of jobs in each group. Once the benchmark is established for that given month, each industry group is sorted into low or high quality by comparing each group’s specific weekly wage to the quality benchmark. If an industry’s weekly wage for the month is below (above) the benchmark, then it is considered low (high)-quality job.
Once the data are sorted, the total number of high-quality jobs is divided by the total number of low-quality jobs for that given month. This ratio represents the preliminary JQI value. An index reading of 100 would indicate an even distribution. Readings below 100 indicate a greater concentration in/prevalence of lower-quality (those below the mean) positions, and a reading above 100 indicates greater concentration/prevalence of higher-quality positions. It should be noted that the total number of “jobs” is represented by the total number of positions, as opposed to workers, for that given industry group.
About the JQ Instant
The JQ-Instant is a snapshot index that results from the subdivision of the change in the CES calculation of all private sector jobs (not just P&NS jobs) for the subject month into high-quality and low-quality jobs, utilizing the JQI sectoral divisions for P&NS jobs. Thus, if a marginal job is created or lost in a sector that the JQI classifies as high-quality, all private sector jobs created or lost in the subject month are considered high-quality for the purposes of the JQ-Instant calculation – the reverse being the case for low-quality jobs. JQ-Instant readings are revised in subsequent months commensurate with revisions to the CES data by the BLS.
The JQ-Instant calculation utilizes 123 sectoral categories, in contrast to the 180 used in the JQI itself, because of a one month delay in the BLS reporting of more granular data. Because JQ-Instant inherently assumes that all industry categories and subcategories that are on one side or another of the Quality Job Benchmark for purposes of the JQI (which analyzes only P&NS jobs) are also on the same side when considering all jobs (i.e. P&NS as well as managerial/supervisory jobs), there may occasionally be certain industry categories that may flip from one quality designation to the other when all jobs are considered, making the JQ-Instant reading somewhat inaccurate. In general, however, industries offering high or low quality P&NS jobs (82.5% of all jobs) are generally in the same category when all jobs are considered, making the JQ-Instant reading a useful tool for a snapshot analysis of the job quality of the subject month’s level of total private sector jobs gained or lost.
Finally, the JQ-Instant reading has implications for the likely direction of the JQI itself in future months. As the JQI is reported as a three-month rolling average of actual monthly readings, significant imbalances (readings varying from an even distribution between high and low quality jobs) in the JQ-Instant results would suggest future JQI readings moving in the direction of the dominant side of such distribution.
JQ-Instant is reported on a scale of +100 to -100, reflecting the relative proportion of low quality jobs. Positive readings indicate overall net month over month gains in all U.S. private sector jobs. Negative readings indicate overall net month over month losses in all U.S. private sector jobs. A reading of +100 would indicate that all jobs gained in the subject month are low quality jobs. A reading of -100 would indicate that all jobs lost in the subject month are low quality jobs. A JQ-Instant reading of +50 would indicate that 50% of the overall jobs gained in the subject month are low quality jobs, and a reading of -50 would indicate that 50% of the overall jobs lost in the subject month are low quality jobs, and so forth.
The U.S. Private Sector Job Quality Index Slide Deck
JQI Launch Event
November 22, 2019