David M. Talan

Window on Washington: Business Employment Dynamics

Column Editors Note: David M. Talan, James R. Spletzet, and Richard L. Clayton, all of the Bureau of Labor Statistics, describe the new BLS Business and Employment Dynamics data series. Based on the Quarterly Census of Employment and Wage, this new data series provides important information on job churn at the establishment level that is often hidden by focusing on statistics on net employment change. Further, through use of this data series, changes in the rate ofjob growth can be better tracked by source job creation in new businesses, job creation or loss in established businesses, or loss ofjobs in failing businesses. One interesting complication in producing these statistics is that it is difficult to determine when the unemployment insurance identification number for a business changes due to ownership turnover instead ofa complete reformulation ofthe business. Failure to ascertain when this has happened can result in serious overestimation ofjob churn. Fellegi-Sunters exact match techniques are used to identify these instances. One very important application of this work is to help identify business cycles and their underlying causes.