JobQual
i
t
y:2004Updat
e

Mar
c
h2006

TOM R.REX,MBA

Associ
at
eDi
r
ect
or
,Cent
erf
or
Compet
i
t
i
venessandPr
osper
i
t
y
Resear
ch

JOB QUALITY: 2004 UPDATE
A Report from the Productivity and Prosperity Project (P3)

March 2006

Tom R. Rex
Associate Director, Center for Competitiveness and Prosperity Research

Center for Competitiveness and Prosperity Research
L. William Seidman Research Institute
W. P. Carey School of Business
Arizona State University
Box 874011
Tempe, Arizona 85287-4011
(480) 965-5362
FAX: (480) 965-5458
EMAIL: Tom.Rex@asu.edu
www.wpcarey.asu.edu/seid

CONTENTS
Summary
Introduction
Data
Methodology
Results for the United States
Change in Industrial Job Quality, 2001-04
Change in Occupational Job Quality, 2001-04
Results for Arizona
Industrial Mix, 2004
Occupational Mix, 2004
Change in Industrial Job Quality, 2001-04
Change in Occupational Job Quality, 2001-04
Results for All States
Industrial Job Quality
Occupational Job Quality
Overall Job Quality
Average Wage After Adjusting for Job Quality
Tables
1. 2001-04 Change in Job Quality Scores by Sector: United States
2. 2001-04 Change in Job Quality Scores by Industry: United States
3. 2001-04 Change in Job Quality Scores by Occupational Group: United States
4. 2001-04 Change in Job Quality Scores by Occupation: United States
5. 2004 Industrial Mix by Sector: Arizona
6. 2004 Industrial Mix by Industry: Arizona
7. 2004 Occupational Mix by Occupational Group: Arizona
8. 2004 Occupational Mix by Occupation: Arizona
9. 2001-04 Change in Industrial Job Mix and Change in Industrial Job Quality Relative to
the Nation by Sector: Arizona
10. 2001-04 Change in Industrial Job Mix by Industry: Arizona
11. 2001-04 Change in Job Quality Scores By Industry: Arizona and the United States
12. 2001-04 Change in Occupational Job Mix and Change in Occupational Job Quality
Relative to the Nation by Occupational Group: Arizona
13. 2001-04 Change in Occupational Job Mix by Occupation: Arizona
14. 2001-04 Change in Job Quality Scores by Occupation: Arizona and the United States
15. Industrial Job Quality by State
16. 2004 Industrial Mix Ranked by State
17. 2001-04 Change in Industrial Mix Ranked by State
18. Occupational Job Quality By State
19. 2004 Occupational Mix Ranked by State
20. 2001-04 Change in Occupational Mix Ranked by State
21. 2004 Overall Job Quality Ranked by State
22. 2001-04 Change in Overall Job Quality Ranked by State
23. 2004 Average Wage and Job Quality by State
24. 2001-04 Change in Average Wage and Job Quality by State

1

2
4
4
5
8
8
8
13
13
16
19
23
27
27
33
38
41

9
10
11
12
14
15
17
18
20
21
22
24
25
26
28
30
32
34
36
37
39
40
42
44

SUMMARY
The long-term trend toward lower-quality jobs in the United States continued between
2001 and 2004. Industrial job quality fell 1.6 percent nationally between 2001 and 2004. The
decrease in occupational job quality was not quite as great at 0.9 percent. Thus, overall U.S. job
quality dropped 2.5 percent during the three years, causing the U.S. average wage to be 2.5
percent less than it otherwise would have been.
Historically, most of the losses in job quality have occurred during economic recessions
and in the recovery phase following recessions. The economic recession of 2001 was followed
by a slow recovery that extended into 2003. In conjunction with this economic cycle, job quality
nationally decreased at a relatively rapid rate in 2002 and 2003, but the rate of decline slowed in
2004.
The decrease in national job quality between 2001 and 2004 was widespread industrially.
Job quality fell in 16 of the 20 sectors, was flat in two sectors, and rose only marginally in the
other two sectors. The most significant decreases occurred in accommodation and food services
(a low-paying sector whose employment grew faster than average), information (a high-paying
sector whose employment sectoral share fell), and manufacturing (a somewhat high-paying
sector whose employment dropped substantially).
In contrast to the widespread but small decreases in job quality by industrial sector, the
reduction in national occupational job quality between 2001 and 2004 was concentrated in just
one of the 22 major occupational groups. The decrease in the management group was greater
than the decline in the overall occupational figure. The highest paying of the groups,
management had the largest decrease in employment share.
Arizona’s job quality fell between 2001 and 2004 at a pace worse than the national
average. Relative to the national average, the industrial and occupational job mixes each slipped
a bit more than 0.3 percent during the three years, for an overall decline of 0.7 percent. Among
the states, Arizona ranked 42nd on the change in industrial mix, 30th on the change in
occupational mix, and 44th overall. Historically, the state usually falls further behind the nation
during periods of economic weakness, as experienced in 2002 into 2003. However, job quality
also fell by more than the national average in 2004.
A loss of jobs in the high-paying semiconductor manufacturing industry was primarily
responsible for Arizona’s weakening industrial mix between 2001 and 2004, both overall and in
relation to the national average. Even in 2004, a disproportionate amount of the decline in
industrial job quality relative to the U.S. average originated in this industry. Despite its recent
problems, semiconductor manufacturing remained a large positive force on the state’s 2004 job
mix.
In Arizona, job quality in 2004 was 2.0 percent below the national average, but Arizona
ranked 23rd among all states. The level of industrial job quality in 2004 was 1.6 percent less than
the national average, ranking 23rd, and occupational job quality was 0.5 percent below average,
also ranking 23rd. Thus, Arizona’s job mix being tilted toward low-paying industries and
occupations accounted for 2 percentage points of the nearly 7 percent shortfall in Arizona’s
average wage from the national average.
Three sectors largely were responsible for the state’s subpar industrial mix. The shares of
employment in the low-paying administrative support sector and the very low-paying
accommodation and food services sector were larger in Arizona than the U.S. average, while the
high-paying professional, scientific and technical services sector was disproportionately smaller
in Arizona than nationally. Occupationally, the higher-than-average proportion of workers in
3

2

Arizona in the very low-paying food preparation and serving group had the greatest negative
effect on the state’s job quality.
Only the District of Columbia and Rhode Island experienced an improvement in overall
job quality between 2001 and 2004. However, 31 states did better than the national average,
having a positive change in overall job quality relative to the U.S. average between 2001 and
2004. In only 16 states was the change at least 1 percent more than the national average. Six
states had a decrease at least 1 percent more than the national average. The change in job quality
did not have a strong regional pattern, though most of the northern tier of states did better than
the national average while decreases were considerably greater than the national average in the
area encompassing Louisiana, Texas, New Mexico, Colorado, and Arizona.
The level of job quality in 2004 was greater than the national average in only 18 states.
The strongest job quality was in the District of Columbia and seven states that border the
Atlantic Ocean from Massachusetts to Virginia, each with job quality raising the state’s average
wage by at least 6 percent relative to the national average. Outside of this region, the strongest
job quality was in Illinois and Colorado. In the West and the Great Lakes regions, job quality
varied by state from below to above the national average. Job quality was almost uniformly weak
in the Great Plains and South.

3

INTRODUCTION
The methodology and datasets used to produce the measures of job quality presented in
this report are summarized in this section. For a more complete discussion, including a literature
review, see the original job quality reports produced in 2005, available at
www.wpcarey.asu.edu/seid/reports.cfm
Data
The Bureau of Labor Statistics (BLS), part of the U.S. Department of Labor, is the main
source of workforce data. The BLS produces various employment series.
A limitation to all government data is the withholding of data that violates the federal
government’s disclosure restrictions. To prevent the identification of data for a specific
company, data are withheld if too few companies are represented in a given industry or
occupation or if one company dominates the category. Data for a second category must be
withheld, even if its disclosure restriction is not violated, so that the data for the first category
cannot be calculated from available data.
For this project, categories with withheld data were combined by sector or occupational
group — the data for these aggregations of withheld categories could be calculated from the
figures at the next higher level of industrial or occupational detail and figures for other categories
at the same level.
The withholding of data has two significant effects on the calculation of job quality. First,
the quality of the results is compromised as missing industries (or occupations) have to be
combined with other missing industries that may have considerably different average wages
and/or changes in employment. The disclosure restriction has little effect on national data but a
considerable impact on published data for most subnational areas. For example, more than half
of the industrial or occupational data are withheld in the least populous states. By metropolitan
area, the proportion withheld is even greater except in the largest areas.
Second, processing time is very substantially increased due to the withholding of data.
The dataset for every state in every year is unique in terms of the industries (or occupations)
disclosed, limiting the degree to which the processing of the data can be fully computerized. In
order to accurately compare each state to the national average, the national dataset is adjusted for
every state in every year so that the undisclosed categories match those in the state. For this
report, 51 industrial datasets were created for each of two years for the states. This number is
doubled for the matching national dataset and doubled again for the occupational datasets,
resulting in a total of 408 individual datasets.
Thus, while it would be desirable to produce year-by-year data (annual industrial data
back to 1990 could be examined), the man-hours required for such an analysis are tremendously
large. Similarly, no attempt has been made to calculate job quality by metro area, both because
of the time requirements and because of the very substantial amount of undisclosed data in most
metro areas.
Occupational Data
Occupational data generally are perceived to be superior to industrial data when
examining job quality. The Occupational Employment Statistics program (OES) is the only
source of occupational data by state and metropolitan area other than the decennial census. OES
data are adjusted to full-time-equivalent status, but are based on a sample of employers.
Moreover, a limited history of occupational data is available by state, with a discontinuity in

4

1999 when the Standard Occupation Classification (SOC) system was adopted. The BLS
currently conducts the OES survey semiannually; previously the data were collected annually.
However, since employers are contacted only once every three years, fully comparable data exist
only for three-year comparisons. Thus, the latest data for 2004 — which were released in
November 2005 — were compared to those for 2001 for this project.
The SOC defines 733 occupations, which are combined into 22 major occupational
groups. However, some data are withheld even at the national level, so that the national number
of occupations (including aggregations of withheld occupations by occupational group) available
in both 2001 and 2004 was 721. The number by state ranged from 681 in California to 377 in
Alaska and 336 in the District of Columbia.
Industrial Data
The Quarterly Census of Employment and Wages (CEW) — previously referred to as the
unemployment insurance or ES-202 program — provides data for the nation, states, metropolitan
areas and counties. The CEW data are a census of all workers covered by the unemployment
insurance program and provide the most detailed industrial data. However, the wages of parttime workers or those who work more than 40 hours per week are not adjusted to full-timeequivalent status. Annual data for 2004 were released in October 2005.
Industrially, workforce data currently are categorized by the North American Industry
Classification System (NAICS). The NAICS presents data hierarchically. The most detailed data
are for industries (5- or 6-digit NAICS code). These are totaled into industry groups (4-digit),
then into subsectors (3-digit), and finally into 20 (2-digit) sectors. To match the data available by
occupation, the latest industrial data for 2004 were compared to those for 2001 for this project.
For the nation and Arizona, the three-year analysis was supplemented by a comparison of 2003
and 2004 data.
Full industrial detail is available from the CEW program, but considerable data are
withheld and workers not covered by the unemployment insurance program are not included.
The national CEW dataset includes 1,170 industries, but the number available by state in both
2001 and 2004 ranged from 1,076 in California to only 334 in Alaska and Wyoming and 297 in
the District of Columbia. The number by state includes an aggregation of multiple industries
with withheld data within each of the 20 sectors.
The goal of this project was to retain as much detail as possible, so six-digit industries are
the unit of analysis. However, because of the intensive data collection and manipulation that was
necessary, a compromise was made in that all withheld six-digit industries were combined for
each two-digit NAICS sector, rather than using the intermediate three-digit and four-digit
subsector and industry group data.
In a few states, even 2-digit sectoral data were withheld. In these states, the undisclosed
sectoral total was combined with the unclassified category (which also was withheld). Otherwise,
the unclassified category was excluded from the analysis.
Methodology
In this report, job quality is presented both as a level as of a given year (for 2004, the
latest year) and as a change over time (between 2001 and 2004). By state, the level — referred to
as the “job mix” — is expressed relative to the national average; the level cannot be calculated
for the nation. The change over time in job quality can be calculated in various ways. Regardless
of the method used, results can vary substantially depending on the amount of categorical detail

5

used (for example, 6-digit industries versus 2-digit sectors). Conceptually, the more detailed the
data, the more robust the results will be.
Job quality is calculated independently from the industrial and occupational datasets.
Using industrial data, the job mix is referred to as the “industrial mix” and the change over time
is the change in industrial job quality. Using occupational data, the job mix is referred to as the
“occupational mix” and the change over time is the change in occupational job quality. The
occupational and industrial results are combined to create an overall measure of job quality.
Subnational Job Mix (Level of Job Quality)
The job mix (either industrial mix or occupational mix) is calculated from formula 1,
which is applied to every industry or occupation. Sectoral totals are the cumulation of all
industries within the sector; occupational group totals are the cumulation of all occupations
within the group. The overall job mix is calculated by summing over all categories (industries or
occupations):
1
(difference in share of employment between subnational area and nation)
* (ratio of national categorical average wage to overall national average
wage – 1) * 100.
To isolate the effect of geographic differences in the employment structure, the average wage is
held constant in the calculation of job mix by using national wage data. Since local wages are not
used, geographic differences in living costs and other factors that affect local wage levels do not
distort the analysis.
The job mix value of individual occupations or industries can be used to identify the
major contributors to the overall level of job quality. A larger share of employment in the local
area than the national average in a higher-than-average-paying category results in a positive job
mix value, as does a smaller-than-average share in a lower-than-average-paying category.
The overall job mix value indicates the impact of differences in job quality on the
average wage. A job mix value of 2.5, for example, indicates that the job mix in the local area
raises the area’s average wage by 2.5 percent relative to the national average.
Change in National Job Quality Over Time
The change in job quality (sometimes referred to as the “score” in this report) for the
nation is calculated from formula 2, summing over all categories (industries or occupations):
2
(change over time in categorical share of national employment) * (ratio of
national categorical average wage to overall national average wage – 1) *
100.
The mid-point of the change in job quality score is zero; that is, categorical employment change
that is exactly proportionate to employment shares results in a score of zero. A negative score
indicates a deterioration in job quality while a positive score signals an improvement in job
quality. The multiplication by 100 in the formula converts the results to percentages. For
example, a job quality score of -0.5 indicates that deterioration in job quality had a downward
effect of 0.5 percent on the overall average wage.
The wage data used in this calculation can be for either the first or last year of the time
period being analyzed. (The first year has been used in this paper.) For short time periods (such
as the three-year period reported in this paper), the choice of year has only a modest effect on the
results, but the differences may be significant when analyzing a long time period. An alternative
for longer time periods in which annual data are available is to calculate the annual change in job

6

quality, then to cumulate the annual scores. When annual data exist, the cumulation of annual
scores is the preferred method since it allows the average wage data to be updated each year,
rather than held constant.
The job quality scores of individual categories can be used to identify the major
contributors to the overall change in job quality. Faster-than-average growth in a higher-thanaverage-paying category results in a positive score, as does slower-than-average growth in a
lower-than-average-paying category.
Change in Subnational Job Quality Over Time
The change in subnational job quality over time can be computed using any of three
calculations. The simplest technique is to calculate the difference in job mix over time by using
formula 1 to calculate the job mix value in each of two years and taking the difference between
the two job mix values. Geographic differences in living costs and other factors that affect local
wage levels do not distort this calculation. Thus, it is the preferred method when the focus is to
compare states.
An alternative is to calculate the change in subnational job quality using formula 2,
substituting subnational employment for national employment. Since national wages are used,
geographic differences in living costs and other factors that affect local wage levels also do not
distort this calculation. The advantage of this alternative is that the change in subnational job
quality can be compared directly to the change in national job quality. The difference in change
in job quality between the local area and the nation using formula 2 is not the same as that
calculated from formula 1 in part because formula 2 uses the average wage in just one year while
formula 1 uses the wage data in each year.
A third alternative can be employed if the focus is to examine one subnational area’s
performance over time. This alternative also uses formula 2 to calculate the change in
subnational job quality, substituting both the subnational employment and subnational average
wage for the national figures. When looking at only one geographic area, this method has the
advantage of acknowledging the unique wage structure of the area. However, this technique
should not be used to compare job quality across geographic areas because differences in living
costs and other factors implicit in the local wage structure distort the results. In addition,
especially in categories with little employment in a subnational area, the mix of jobs within the
category (even at the industrial or occupational level) may be substantially different from that of
other areas, causing the local average wage to be different from that in the comparison area.

7

RESULTS FOR THE UNITED STATES
Job quality fell at a relatively fast pace nationally between 2001 and 2004, related to the
economic cycle: though the recession ended in 2001, little recovery was recorded in 2002 and
economic growth as measured by employment remained slow well into 2003. Historically, job
quality has dropped the most during the recessionary and early recovery phases of the cycle.
Declines in industrial job quality caused the average wage to fall 1.6 percent between
2001 and 2004. The decrease in occupational job quality was not quite as great at 0.9 percent.
Thus, overall U.S. job quality dropped 2.5 percent during the three years.
Industrial data for 2003 and 2004 indicate that job quality fell 0.3 percent in 2004, a
lesser rate of decline than the 1.3 percent drop in the two prior years combined — in line with the
historical record. During the expansionary phase of the cycle, annual changes in industrial job
quality typically range from marginal improvements to declines of about 0.3 percent.
Change in Industrial Job Quality, 2001-04
The decrease in national industrial job quality between 2001 and 2004 was widespread
across the industries. Aggregating the changes at the industrial level to the 20 sectors reveals that
job quality fell in 16 of the sectors, was flat in two sectors, and rose only marginally in the other
two sectors (see Table 1). Most of the sectors, however, experienced only a modest change in job
quality. The most significant decreases occurred in accommodation and food services (a lowpaying sector whose employment grew faster than average), information (a high-paying sector
whose employment sectoral share fell), and manufacturing (a somewhat high-paying sector
whose employment dropped substantially).
Only three industries experienced a change in job quality of at least 0.1 over the three
years. The largest decline was in securities brokerage, part of the finance and insurance sector.
The other two industries with the greatest drops were full-service and limited-service restaurants.
Three industries in the information sector had a decrease in job quality score of at least 0.05:
wired telecommunications carriers, software publishers, and internet service providers. Two
manufacturing industries were on the list: semiconductors and related devices, and electronic
computers (see Table 2).
Change in Occupational Job Quality, 2001-04
In contrast to the widespread but small decreases in job quality by industrial sector, the
reduction in national occupational job quality between 2001 and 2004 was centered on just one
of the 22 major occupational groups. The management group had a score of –1.0, a greater
decline than the overall occupational figure (see Table 3). The highest paying of the groups,
management had the largest decrease in employment share. Otherwise, the most significant
decrease occurred in food preparation and serving (a low-paying group whose employment grew
faster than average). This decline largely was offset by a gain in business and financial
operations (a high-paying group whose employment sectoral share rose).
Only four occupations experienced a change in job quality of at least 0.1 over the three
years. The three largest declines all were in very high-paying occupations within the
management group: general and operations managers, chief executives, and management
occupations not specified. Financial managers, another management occupation, experienced a
slightly lesser decrease. The other occupation with a drop of 0.1 was low-paying waiters and
waitresses. The combined food preparation and serving occupation also was on the list of largest
negative values (see Table 4).

8

TABLE 1
2001-04 CHANGE IN JOB QUALITY SCORES BY SECTOR: UNITED STATES

Sector
Retail Trade
Real Estate and Rental and Leasing
Agriculture, Forestry, Fishing and Hunting
Administrative and Support and Waste Mgt
Mining
Arts, Entertainment, and Recreation
Management of Companies
Utilities
Educational Services
Government
Transportation and Warehousing
Wholesale Trade
Other Services
Construction
Finance and Insurance
Health Care and Social Assistance
Professional, Scientific and Technical Services
Accommodation and Food Services
Information
Manufacturing
TOTAL

Score*
0.02
0.01
0.00
0.00
-0.01
-0.02
-0.02
-0.03
-0.03
-0.03
-0.05
-0.05
-0.06
-0.08
-0.09
-0.10
-0.11
-0.28
-0.28
-0.39
-1.59

2001 Average
Wage Ratio**
0.63
0.91
0.56
0.67
1.65
0.70
1.90
1.81
0.89
1.01
1.00
1.35
0.64
1.06
1.76
0.91
1.62
0.38
1.58
1.19

2001-04
Change in
Sectoral
Share**/***
-0.06
0.04
0.00
0.09
-0.01
0.06
-0.02
-0.02
0.15
0.40
-0.09
-0.06
0.07
0.12
0.15
0.83
-0.06
0.42
-0.38
-1.61

*

Formula 2: (Change over time in industrial share of national employment) * (ratio of national industrial
average wage to overall national average wage – 1) * 100. The sectoral figures are calculated as the
sum of the industrial scores within each sector.
** The average wage and change in sectoral share are for the entire sector, but calculations of the job
quality score used the average wage and change in employment share of each industry. In some
sectors, the average wage and the change in share vary widely by industry. This variation makes it
possible, for example, for a high-wage sector with an increase in share, such as finance and
insurance, to post a negative score.
*** The sectoral shares are presented as percentages (multiplied by 100).
Source: Calculated from U.S. Department of Labor, Bureau of Labor Statistics, Census of Employment
and Wages.

9

TABLE 2
2001-04 CHANGE IN JOB QUALITY SCORES BY INDUSTRY: UNITED STATES
Industries with a Score of at Least 0.05
2001-04
Change in
Sectoral
Share**

Industry
Positive Score
Real Estate Credit
Offices of Physicians
Wholesale Trade Agents
Department Stores except Discount Stores
Negative Score
Securities Brokerage
Full-Service Restaurants
Limited-Service Restaurants
Wired Telecommunications Carriers
Warehouse Clubs and Superstores
Semiconductor & Related Devices Manufacturing
Computer Equipment & Software Merchant Whlsl
Electronic Computer Manufacturing
Software Publishers
Internet Service Providers

Score*

2001
Average
Wage Ratio

0.07
0.07
0.06
0.06

1.80
1.64
1.60
0.49

0.08
0.11
0.09
-0.11

-0.17
-0.16
-0.10
-0.09
-0.07
-0.06
-0.06
-0.05
-0.05
-0.05

4.38
0.36
0.29
1.64
0.49
2.18
2.44
2.62
2.89
2.31

-0.06
0.25
0.14
-0.14
0.13
-0.06
-0.04
-0.03
-0.03
-0.04

Subtotal of Industries with a Score of >= 0.05
Subtotal of Industries with a Score of <= -0.05
Industries Not Shown
TOTAL

0.26
-0.86
-0.99
-1.59

* Formula 2: (Change over time in industrial share of national employment) * (ratio of national industrial
average wage to overall national average wage – 1) * 100.
** The sectoral shares are presented as percentages (multiplied by 100).
Source: Calculated from U.S. Department of Labor, Bureau of Labor Statistics, Census of Employment
and Wages.

10

TABLE 3
2001-04 CHANGE IN JOB QUALITY SCORES BY OCCUPATIONAL GROUP:
UNITED STATES

Occupational Group
Business and Financial Operations
Production
Education, Training, and Library
Computer and Mathematical
Life, Physical, and Social Science
Legal
Office and Administrative Support
Health Practitioners and Technical
Arts, Design, Entertainment, Sports and Media
Construction and Extraction
Farming, Fishing, and Forestry
Building, Grounds Cleaning and Maintenance
Community and Social Services
Installation, Maintenance, and Repair
Protective Service
Transportation and Material Moving
Architecture and Engineering
Healthcare Support
Sales and Related
Personal Care and Service
Food Preparation and Serving
Management
TOTAL

Score*
0.22
0.17
0.09
0.09
0.05
0.04
0.03
0.02
0.02
0.02
-0.00
-0.00
-0.00
-0.01
-0.02
-0.03
-0.04
-0.05
-0.09
-0.12
-0.25
-1.03
-0.91

2001 Average
Wage Ratio**
1.49
0.81
1.15
1.77
1.46
2.03
0.80
1.47
1.17
1.04
0.58
0.60
1.01
1.03
0.96
0.78
1.66
0.64
0.85
0.62
0.49
2.08

2001-04
Change in
Occupational
Share**/***
0.41
-0.91
0.19
0.06
0.05
0.04
-0.30
0.23
0.10
0.01
-0.01
0.01
0.11
-0.10
0.06
0.08
-0.10
0.12
0.13
0.25
0.49
-0.92

*

Formula 2: (Change over time in occupational share of national employment) * (ratio of national
occupational average wage to overall national average wage – 1) * 100. The occupational group
figures are calculated as the sum of the occupational scores within each group.
** The average wage and change in occupational share are for the entire group, but calculations of the
job quality score used the average wage and change in employment share of each occupation.
*** The sectoral shares are presented as percentages (multiplied by 100).
Source: Calculated from U.S. Department of Labor, Bureau of Labor Statistics, Occupational Employment
Statistics.

11

TABLE 4
2001-04 CHANGE IN JOB QUALITY SCORES BY OCCUPATION: UNITED STATES
Occupations with a Score of at Least 0.05
2001-04
Change in
Occupational
Share**

Occupation
Positive Score
Miscellaneous Production
Computer Software Engineers, Applications
Computer Software Engineers, Systems
Negative Score
General and Operations Managers
Chief Executives
Miscellaneous Management
Waiters and Waitresses
Retail Salespersons
Financial Managers
Miscellaneous Architects and Engineers
Hand Laborers
Combined Food Preparation and Service
Computer Programmers
Personal Aides

Score*

2001
Average
Wage Ratio

0.08
0.07
0.05

0.79
2.13
2.19

-0.38
0.06
0.05

-0.34
-0.21
-0.19
-0.10
-0.09
-0.08
-0.08
-0.08
-0.07
-0.07
-0.06

2.16
3.17
1.96
0.45
0.62
2.22
1.76
0.62
0.44
1.85
0.49

-0.29
-0.10
-0.20
0.18
0.24
-0.07
-0.10
0.21
0.11
-0.08
0.11

Subtotal of Occupations with a Score of >= 0.05
Subtotal of Occupations with a Score of <= -0.05
Occupations Not Shown
TOTAL

0.20
-1.37
0.26
-0.91

* Formula 2: (Change over time in occupational share of national employment) * (ratio of national
occupational average wage to overall national average wage – 1) * 100.
** The sectoral shares are presented as percentages (multiplied by 100).
Source: Calculated from U.S. Department of Labor, Bureau of Labor Statistics, Occupational Employment
Statistics.

12

RESULTS FOR ARIZONA
In 2004, job quality in Arizona was inferior to the national average. The industrial job
mix caused the state’s average wage to be nearly 1.6 percent less than the U.S. average, while the
occupational job mix had a negative effect on the average wage of 0.5 percent. Thus, Arizona’s
average wage was 2 percent less than the national average due to its job mix being tilted toward
low-paying industries and occupations. Though Arizona’s job mix was below the national
average, Arizona ranked among the middle of the states at 23rd on each measure: industrial mix,
occupational mix, and total job mix.
Arizona’s job mix fell further behind the national average between 2001 and 2004. The
industrial and occupational job mixes each slipped a bit more than 0.3 percent during the three
years (using formula 1), for an overall decline of 0.7 percent relative to the national average.
Arizona ranked 42nd on the change in industrial mix, 30th on the change in occupational mix,
and 44th overall. Historically, the state usually falls further behind during periods of economic
weakness as experienced in 2002 into 2003. An examination of 2003 and 2004 industrial data
reveals that the industrial job mix in Arizona slipped 0.1 percent relative to the national average
in 2004, about the same rate of decline as in the two prior years.
Declines between 2001 and 2004 in Arizona’s job quality as measured by formula 2 were
not quite as great as those from formula 1, with industrial job quality falling 0.1 percent and
occupational job quality dropping 0.2 percent. Thus, the state’s overall job quality score went
down 0.3 percent relative to the national average during the three years. Not expressed relative to
the national average, job quality in Arizona fell 2.8 percent between 2001 and 2004, with an
industrial job quality score of –1.7 and an occupational score of –1.2. Looking only at the 2003to-2004 change calculated by formula 2, industrial job quality in Arizona dropped 0.3 percent,
the same as the national average. Thus, while job quality in 2004 eroded at a lesser pace than in
the two prior years, nationally and in Arizona, the state’s performance relative to the national
average was hardly different in 2004 than in the two prior years.
Industrial Mix, 2004
Aggregating the job mix values at the industrial level to the 20 sectors reveals that nearly
half of the sectors had a positive industrial mix value in 2004 despite the overall figure being
–1.6 (see Table 5). Among the nine sectors with a positive value, only two were significant,
exceeding 0.4 in the health care and social assistance sector and in the manufacturing sector.
Three sectors had an industrial mix value worse than –0.4. The share of total employment
in the very low-paying accommodation and food services sector was larger in Arizona than the
U.S. average. The low-paying administrative support sector was considerably larger in Arizona
than the U.S. average. In contrast, the high-paying professional, scientific and technical services
sector was smaller in Arizona than nationally.
Industries with a job mix value in 2004 of at least 0.1 (positive or negative) are listed in
Table 6, divided into four groupings dependent on the size of their sectoral share relative to the
U.S. average and whether their average wage was greater or less than the overall average wage
(using national wages). Only two low-paying industries that had an employment sectoral share
smaller in Arizona than the national average made the list of positive contributors: nursing care
facilities and private households (for example, a butler employed by a family).
The job mix value of the semiconductor manufacturing industry stands out, a result of its
high wages and strong presence in Arizona. Two other high-paying high-technology industries
had job mix values greater than 0.2: search and navigation instrument manufacturing and

13

TABLE 5
2004 INDUSTRIAL MIX BY SECTOR: ARIZONA

Job Mix
Value*
0.49
0.42
0.24
0.17
0.12
0.09
0.06
0.01
0.01
-0.02
-0.04
-0.07
-0.18
-0.19
-0.21
-0.22
-0.34
-0.46
-0.63
-0.78
-1.55

Sector
Health Care and Social Assistance
Manufacturing
Other Services
Arts, Entertainment and Recreation
Transportation
Wholesale Trade
Real Estate
Utilities
Mining
Government
Educational Services
Retail Trade
Construction
Finance and Insurance
Information
Agriculture
Management of Companies
Accommodation and Food Services
Professional, Scientific and Technical Services
Administrative Support
TOTAL

Ratio of
Average
Wage to
Total, U.S.**
0.93
1.22
0.64
0.70
0.99
1.35
0.95
1.84
1.69
1.03
0.90
0.62
1.03
1.78
1.54
0.57
2.03
0.37
1.59
0.61

Arizona –
U.S. Sectoral
Share**/***
-1.38
-3.53
-0.57
-0.15
-0.36
-0.30
0.33
0.05
-0.05
-0.20
-0.29
0.64
2.80
0.53
-0.36
0.34
-0.36
0.77
-0.59
2.66

*

Formula 1: (Arizona – U.S. industrial employment share) * (ratio of national industrial average wage to
overall U.S. average wage - 1) * 100. The sector totals are calculated as the sum of the industrial
values within each sector.
** The average wage and change in sectoral share are for the entire sector, but calculations of the job
quality score used the average wage and change in employment share of each industry. In some
sectors, the average wage and the change in share vary widely by industry. This variation makes it
possible, for example, for a high-wage sector with an increase in share, such as finance and
insurance, to post a negative score.
*** The sectoral shares are presented as percentages (multiplied by 100).
Source: Calculated from U.S. Department of Labor, Bureau of Labor Statistics, Census of Employment
and Wages.

14

TABLE 6
2004 INDUSTRIAL MIX BY INDUSTRY: ARIZONA
Industries with a Job Mix Value of at Least 0.1

Job Mix
Industry
Value*
Sectoral Share Larger in Arizona & Above Average Wage
Semiconductor Manufacturing
0.92
Search and Navigation Instrument Manufacturing
0.27
Electronics Parts Wholesale
0.21
Management Consulting Services
0.19
Real Estate Credit
0.16
Aircraft Engine Manufacturing
0.15
Sports Teams
0.14
Financial Transactions Processing
0.14
Credit Card Issuing
0.14
Other Credit Intermediation
0.12
Sectoral Share Smaller in Arizona & Below Average Wage
Nursing Care Facilities
0.28
Private Households
0.18
Sectoral Share Larger in Arizona & Below Average Wage
Professional Employer Organizations
-0.37
Hotels and Motels
-0.31
Temporary Help Services
-0.21
Farm Labor Contractors
-0.19
Limited Service Restaurants
-0.16
Sectoral Share Smaller in Arizona & Above Average Wage
Corporate and Regional Managing Offices
-0.36
Investment Banking
-0.27
Research & Development in Sciences
-0.26
Portfolio Management
-0.24
Offices of Lawyers
-0.19
Pharmaceutical Preparation Manufacturing
-0.16
Custom Computer Programming
-0.14
Motion Picture Production
-0.10
Subtotal with a Positive Job Mix Value
Subtotal with a Negative Job Mix Value
Industries Not Shown
TOTAL

2.90
-2.96
-1.49
-1.55

Ratio of
Average
Wage to
Total, U.S.

Arizona –
U.S.
Sectoral
Share**

2.23
2.03
1.83
1.97
1.86
1.70
3.89
1.37
1.77
1.38

0.75
0.26
0.25
0.19
0.19
0.21
0.05
0.38
0.18
0.33

0.62
0.39

-0.75
-0.30

0.73
0.55
0.54
0.35
0.29

1.39
0.69
0.45
0.29
0.23

1.98
4.58
2.05
4.63
1.75
2.16
2.05
1.86

-0.37
-0.08
-0.25
-0.07
-0.25
-0.14
-0.13
-0.12
1.74
1.64
-3.38
0.00

* Formula 1: (Arizona – U.S. industrial employment share) * (ratio of national industrial average wage to
overall U.S. average wage - 1) * 100.
** The sectoral shares are presented as percentages (multiplied by 100).
Source: Calculated from U.S. Department of Labor, Bureau of Labor Statistics, Census of Employment
and Wages.

15

wholesaling of electronic parts. Aircraft engine manufacturing also had a positive value. These
high-tech manufacturing industries were responsible for the positive industrial mix value for the
manufacturing sector, offsetting the small size of most manufacturing industries in Arizona.
Several industries had a job mix value of –0.2 or worse, including the low-paying
tourism-related industry of hotels and motels. This industry along with the limited-service
restaurants industry accounted for the low job mix value in the accommodation and food services
sector. Much of the low value in the administrative support sector resulted from the belowaverage-paying professional employer organizations (previously called employee leasing) and
temporary help services industries. Arizona employers utilize contract and temporary workers
more than the national average.
Industries paying above-average wages but of relatively small size in Arizona included
corporate and regional managing offices. Research and development in the sciences and offices
of lawyers accounted for much of the negative job mix value in the professional, scientific and
technical services sector. Two very high-paying finance industries — investment banking and
portfolio management — also appear on the list.
Occupational Mix, 2004
Thirteen of the 22 major occupational groups had a negative job mix value in 2004; the
overall figure was –0.5. The largest negative effect came from the large size in Arizona of the
low-paying food preparation and serving group. The smaller-than-average sizes of the highpaying health practitioners and technical group and computer and mathematical group also
contributed to the overall negative value. In contrast, the larger-than-average size of the highpaying architecture and engineering group and the relatively small size of the below-averagepaying production group had sizable positive effects on the state’s occupational job mix (see
Table 7).
No occupation had a job mix value as large as 0.15 in 2004 (see Table 8). Electrical and
electronics engineers were primarily responsible for the positive impact of the architecture and
engineering group. Three occupations had a negative value worse than 0.2. General and
operations managers had a value of –0.4, but this was largely offset by the positive contributions
of three other occupations in the management group: sales managers, financial managers, and
chief executives. The negative value in the registered nurses occupation partially explained the
negative value in the health practitioners group.

16

TABLE 7
2004 OCCUPATIONAL MIX BY OCCUPATIONAL GROUP: ARIZONA

Job Mix
Value*
0.49
0.47
0.16
0.14
0.13
0.09
0.07
0.05
0.03
-0.01
-0.06
-0.07
-0.07
-0.10
-0.10
-0.11
-0.12
-0.13
-0.18
-0.29
-0.39
-0.52
-0.50

Occupational Group
Architecture and Engineering
Production
Healthcare Support
Transportation and Material Moving
Management
Personal Care and Service
Sales and Related
Business and Financial Operations
Community and Social Services
Protective Service
Installation, Maintenance, and Repair
Arts, Design, Entertainment, Sports and Media
Building, Grounds Cleaning and Maintenance
Office and Administrative Support
Farming, Fishing, and Forestry
Education, Training, and Library
Legal
Life, Physical, and Social Science
Construction and Extraction
Computer and Mathematical
Health Practitioners and Technical
Food Preparation and Serving
TOTAL

Ratio of
Average
Wage to
Total, U.S.**
1.68
0.79
0.63
0.75
2.33
0.59
0.86
1.53
0.99
0.94
1.01
1.17
0.58
0.79
0.55
1.14
2.17
1.54
1.01
1.77
1.56
0.47

Arizona –
U.S. Sectoral
Share**/***
0.56
-2.64
-0.34
-0.90
0.19
-0.01
0.11
0.05
-0.25
0.31
0.03
-0.22
0.22
0.98
0.17
-0.55
-0.10
-0.24
2.67
-0.20
-0.75
0.91

*

Formula 1: (Arizona – U.S. occupational employment share) * (ratio of national occupational average
wage to overall U.S. average wage - 1) * 100. The occupational group totals are calculated as the
sum of the occupational values within each group.
** The average wage and change in occupational share are for the entire group, but calculations of the
job quality score used the average wage and change in employment share of each occupation. This
variation makes it possible, for example, for a group with an above average wage and an increase in
share, such as construction and extraction, to post a negative score.
*** The sectoral shares are presented as percentages (multiplied by 100).
Source: Calculated from U.S. Department of Labor, Bureau of Labor Statistics, Occupational Employment
Statistics.

17

TABLE 8
2004 OCCUPATIONAL MIX BY OCCUPATION: ARIZONA
Occupations with a Job Mix Value of at Least 0.1

Job Mix
Occupation
Value*
Occupational Share Larger in Arizona & Above Average Wage
Sales Representatives, Technical and Scientific
0.14
Sales Managers
0.13
Electrical Engineers
0.13
Financial Managers
0.11
Chief Executives
0.11
Electronics Engineers
0.11
Management Analysts
0.10
Occupational Share Smaller in Arizona & Below Average Wage
Miscellaneous Production Occupations
0.14
Nursing Aides
0.14
Janitors
0.12
Occupational Share Larger in Arizona & Below Average Wage
Customer Service Representative
-0.18
Landscapers, Groundskeepers
-0.15
Combined Food Preparation and Serving
-0.14
Food Preparation
-0.13
Farm Workers
-0.11
Occupational Share Smaller in Arizona & Above Average Wage
General and Operations Managers
-0.41
Registered Nurses
-0.23
Miscellaneous Business and Financial Operations
-0.21
Miscellaneous Education, Training and Library
-0.15
Lawyers
-0.12
Computer Systems Analysts
-0.10
Subtotal with a Positive Job Mix Value
Subtotal with a Negative Job Mix Value
Occupations Not Shown
TOTAL

1.23
-1.93
0.20
-0.50

Ratio of
Average
Wage to
Total, U.S.

Arizona –
U.S.
Occupational
Share**

1.81
2.59
2.02
2.52
3.76
2.10
1.96

0.17
0.08
0.12
0.07
0.04
0.10
0.11

0.76
0.58
0.56

-0.57
-0.33
-0.27

0.78
0.59
0.41
0.48
0.46

0.81
0.37
0.24
0.25
0.21

2.50
1.49
1.57
1.32
2.95
1.86

-0.27
-0.47
-0.37
-0.48
-0.06
-0.12
-0.48
0.11
0.37
0.00

* Formula 1: (Arizona – U.S. occupational employment share) * (ratio of national occupational average
wage to overall U.S. average wage - 1) * 100.
** The occupational shares are presented as percentages (multiplied by 100).
Source: Calculated from U.S. Department of Labor, Bureau of Labor Statistics, Occupational Employment
Statistics.

18

Change in Industrial Job Quality, 2001-04
Between 2001 and 2004, Arizona’s industrial job mix fell 0.3 percent relative to the
nation even though not quite half of the 20 sectors had a negative value. The manufacturing
sector was the cause of the decline, with a decrease of more than 0.5 in its job mix value. The
next largest change was the positive value in accommodation and food services, resulting from
the slump in this low-paying sector.
The job mix value (relative to the national average, calculated from formula 1) is
compared to the difference in the job quality score between Arizona and the nation (calculated
from formula 2) in Table 9. The difference in the value is slight in each of the sectors. Also
shown in Table 9 is Arizona’s job quality score not compared to the national average.
Manufacturing accounted for half of the overall decrease, with most of the other sectors also
having a negative value, but of a small magnitude.
Looking only at the 2003-to-2004 change, none of the 20 sectors had a change in
industrial mix value (relative to the national average) as large as 0.1 in either direction in
Arizona. The value for manufacturing still was negative. Manufacturing accounted for the
majority of the decrease in job quality score (not relative to the nation) both in Arizona and
nationally.
The industries with the largest change in job mix (positive or negative) between 2001 and
2004 are shown in Table 10. The only industry with a value greater than +-0.2 was
semiconductor manufacturing, which accounted for all of the negative value in the
manufacturing sector. Despite its decline of –0.6, the semiconductor industry’s job mix value in
2004 still was a strong 0.9 (as shown in Table 6).
The 2001-04 change in the alternative measure of the job quality score (using formula 2)
is shown in Table 11 for those industries with a difference of at least 0.05 between the Arizona
and national score. The decrease in the semiconductor industry was far greater in Arizona than
nationally. Otherwise, no industry had a difference from the national average of much more than
0.1 (the –0.2 value in the warehouse clubs industry was offset by the positive score in the
discount department store industry). Between 2003 and 2004, the semiconductor industry had a
decline in score of more than 0.1, accounting for more than one-third of the overall decrease,
both nationally and in Arizona.

19

TABLE 9
2001-04 CHANGE IN INDUSTRIAL JOB MIX AND CHANGE IN INDUSTRIAL
JOB QUALITY RELATIVE TO THE NATION BY SECTOR: ARIZONA

Arizona
Job Mix*
0.23
0.13
0.13
0.07
0.05
0.04
0.02
0.02
0.02
0.02
0.01
-0.01
-0.01
-0.02
-0.04
-0.05
-0.05
-0.17
-0.17
-0.55
-0.34

Sector
Accommodation and Food Services
Professional, Scientific, Technical
Administrative Support
Other Services
Finance and Insurance
Management of Companies
Real Estate and Leasing
Information
Agriculture
Utilities
Government
Arts, Entertainment and Recreation
Transportation and Warehousing
Educational Services
Wholesale Trade
Health Care and Social Assistance
Mining
Retail Trade
Construction
Manufacturing
TOTAL

Arizona –
U.S. Job
Quality
Score**
0.22
0.14
0.08
0.08
0.05
0.09
0.01
0.01
0.01
0.02
-0.00
-0.02
0.00
-0.01
-0.02
0.00
-0.05
-0.15
-0.13
-0.48
-0.12

Arizona Job
Quality
Score***
-0.06
0.03
0.08
0.03
-0.04
0.07
0.02
-0.26
0.02
-0.00
-0.03
-0.03
-0.04
-0.04
-0.07
-0.10
-0.06
-0.13
-0.21
-0.85
-1.66

*

The difference in the 2001 and 2004 job mix values, with the value for each year calculated from
formula 1: (difference in industrial share of employment between Arizona and the nation) * (ratio of
national industrial average wage to U.S. overall average wage – 1) * 100. The sector totals are
calculated as the sum of the industrial values within each sector.
** The difference between the value in the third column and the value calculated for the nation from
formula 2: (Change over time in industrial share of national employment) * (ratio of national industrial
average wage to U.S. overall average wage – 1) * 100. The sector totals are calculated as the sum of
the industrial values within each sector.
*** Formula 2: (Change over time in industrial share of Arizona employment) * (ratio of national industrial
average wage to U.S. overall average wage – 1) * 100. The sector totals are calculated as the sum of
the industrial values within each sector.

Source: Calculated from U.S. Department of Labor, Bureau of Labor Statistics, Census of Employment
and Wages.

20

TABLE 10
2001-04 CHANGE IN INDUSTRIAL JOB MIX BY INDUSTRY: ARIZONA
All Industries with a Change in Job Mix of at Least 0.05

Industry
Gain in Sectoral Share & Above Average Wage
Search and Navigation Instrument Manufacturing
Management Consulting
Offices of Non-Bank Holding Companies
Real Estate Credit
Credit Card Issuing
Investment Banking
Custom Computer Programming
Computer and Software Wholesale
Loss in Sectoral Share & Below Average Wage
Discount Department Stores
Temporary Help Services
Full-Service Restaurants
Food Service Contractors
Hotels and Motels
Gain in Sectoral Share & Below Average Wage
Warehouse Clubs
Grocery Stores
Loss in Sectoral Share & Above Average Wage
Semiconductor Manufacturing
Securities Brokerage
Other Electronic Parts Wholesale
Corporate and Regional Managing Offices
Portfolio Management
Direct Health Insurance Carriers
Human Resources Consulting
Subtotal with a Positive Change in Job Mix
Subtotal with a Negative Change in Job Mix
Industries Not Shown
TOTAL

Change in
Job Mix*

Ratio of
2004
Average
Wage to
Total, U.S.

Change in
Sectoral
Share,
Difference
from U.S.

0.14
0.14
0.10
0.08
0.08
0.07
0.07
0.07

2.04
1.97
3.23
1.86
1.77
4.58
2.05
2.32

0.12
0.14
0.04
0.09
0.08
0.01
0.05
0.05

0.16
0.11
0.08
0.07
0.06

0.46
0.54
0.36
0.46
0.55

-0.28
-0.25
-0.13
-0.13
-0.11

-0.20
-0.05

0.51
0.51

0.39
0.10

-0.58
-0.10
-0.09
-0.06
-0.06
-0.05
-0.05

2.23
4.20
1.83
1.98
4.63
1.52
1.65

-0.53
-0.03
-0.09
-0.01
-0.01
-0.04
-0.08

1.23
-1.24
-0.33
-0.34

-0.32
-0.30
0.62
0.00

* The difference in the 2001 and 2004 job mix values, with the value for each year calculated from
formula 1: (difference in industrial share of employment between Arizona and the nation) * (ratio of
national industrial average wage to U.S. overall average wage – 1) * 100.
Source: Calculated from U.S. Department of Labor, Bureau of Labor Statistics, Census of Employment
and Wages.

21

TABLE 11
2001-04 CHANGE IN JOB QUALITY SCORES BY INDUSTRY:
ARIZONA AND THE UNITED STATES
All Industries with a Difference in Score of at Least 0.05
Between the Nation and Arizona
Industry
Positive Difference
Discount Department Stores
Management Consulting
Temporary Help Services
Search and Navigation Instrument Manufacturing
Offices of Non-Bank Holding Companies
Miscellaneous Manufacturing
Full-Service Restaurants
Real Estate Credit
Food Service Contractors
Computer and Software Wholesale
Custom Computer Programming
Investment Banking
Hotels and Motels
Negative Difference
Semiconductor Manufacturing
Warehouse Clubs
Professional Employer Organizations
Securities Brokerage
Other Electronic Parts Wholesale
Other Credit Intermediation
Grocery Stores
Miscellaneous Mining
Human Resources Consulting
Subtotal with a Positive Difference
Subtotal with a Negative Difference
Industries Not Shown
TOTAL

Arizona*

Nation**

Difference

0.16
0.15
0.11
0.11
0.08
-0.04
-0.08
0.14
0.06
0.02
0.02
0.02
0.06

-0.00
0.00
-0.01
0.00
-0.02
-0.14
-0.16
0.07
-0.01
-0.06
-0.05
-0.05
0.01

0.16
0.15
0.12
0.11
0.10
0.10
0.08
0.07
0.07
0.07
0.06
0.06
0.05

-0.69
-0.27
-0.10
-0.27
-0.11
-0.06
-0.02
-0.06
-0.06

-0.06
-0.07
-0.01
-0.17
-0.03
0.00
0.03
-0.01
-0.01

-0.62
-0.20
-0.10
-0.10
-0.08
-0.06
-0.05
-0.05
-0.05

0.81
-1.64
-0.83
-1.66

-0.42
-0.33
-0.79
-1.54

1.20
-1.31
-0.01
-0.12

* Formula 2: (Change over time in industrial share of Arizona employment) * (ratio of the national
industrial average wage to U.S. overall average wage – 1) * 100.
** Formula 2: (Change over time in industrial share of U.S. employment) * (ratio of the national industrial
average wage to U.S. overall average wage – 1) * 100. Since the list of industries was limited to those
available for Arizona, these figures do not match those from the section “Results for the United States.”
Source: Calculated from U.S. Department of Labor, Bureau of Labor Statistics, Census of Employment
and Wages.

22

Change in Occupational Job Quality, 2001-04
None of the 22 major occupational groups had much of a change in the occupational job
mix between 2001 and 2004 (see Table 12). Twelve of the groups had a decrease, contributing to
the overall decline of –0.35. The computer and mathematical group had the largest decrease,
with management posting the greatest increase.
The slightly lower overall job mix value (calculated from formula 1) than difference from
the nation in the job quality score (calculated from formula 2) largely resulted from lower job
mix values in the construction and extraction and health practitioners and technical groups. Not
compared to the nation, Arizona’s overall job quality score was –1.2, with most of the decline
occurring in the management group (which relative to the nation had the strongest change in job
mix and change in job quality). The food preparation and serving group had the next worst job
quality score, but it was largely offset by the gain in business and financial operations.
The management group’s increase in job mix between 2001 and 2004 resulted from
several of its occupations posting gains, most notably financial managers and sales managers. In
contrast, the change in job mix was negative in the general and operations managers occupation
(see Table 13). The job mix decline in the computer and mathematical group largely resulted
from the systems analysts and systems software engineers occupations. Despite an overall
decrease in the job mix in the food preparation and serving group, combined food preparation
and serving — a part of this group — had the largest gain in value of any occupation. Its positive
value was offset by three other food group occupations shown in the table: food preparation,
counter attendants, and fast-food cooks.
Table 14 compares the change in job quality scores (calculated from formula 2) by
occupation in Arizona and the nation. As with the job mix calculation, the largest difference was
in the combined food preparation and serving occupation.

23

TABLE 12
2001-04 CHANGE IN OCCUPATIONAL JOB MIX AND CHANGE IN
OCCUPATIONAL JOB QUALITY RELATIVE TO THE NATION BY OCCUPATIONAL
GROUP: ARIZONA

Arizona Job
Mix*
0.25
0.11
0.09
0.07
0.07
0.02
0.01
0.01
-0.01
-0.01
-0.01
-0.02
-0.02
-0.02
-0.04
-0.06
-0.07
-0.11
-0.12
-0.14
-0.14
-0.20
-0.35

Occupational Group
Management
Business and Financial Operations
Healthcare Support
Health Practitioners and Technical
Farming, Fishing, and Forestry
Personal Care and Service
Building, Grounds Cleaning and Maintenance
Community and Social Services
Education, Training, and Library
Arts, Design, Entertainment, Sports and Media
Transportation and Material Moving
Protective Service
Life, Physical, and Social Science
Legal
Architecture and Engineering
Installation, Maintenance, and Repair
Construction and Extraction
Food Preparation and Serving
Sales and Related
Office and Administrative Support
Production
Computer and Mathematical
TOTAL

Arizona –
U.S. Job
Quality
Score**
0.23
0.09
0.09
0.14
0.07
0.03
0.00
0.01
0.00
-0.01
-0.03
-0.02
-0.00
-0.01
-0.06
-0.06
0.04
-0.09
-0.11
-0.13
-0.20
-0.18
-0.20

Arizona Job
Quality
Score***
-0.81
0.31
0.04
0.15
0.07
-0.09
0.00
0.01
0.05
0.01
-0.09
-0.03
0.04
0.03
-0.12
-0.07
0.06
-0.34
-0.21
-0.09
-0.04
-0.09
-1.18

*

The difference in the 2001 and 2004 job mix values, with the value for each year calculated from
formula 1: (difference in occupational share of employment between Arizona and the nation) * (ratio of
national occupational average wage to U.S. overall average wage – 1) * 100. The occupational group
totals are calculated as the sum of the occupational values within each group.
** The difference between the value in the third column and the value calculated for the nation from
formula 2: (Change over time in occupational share of national employment) * (ratio of national
occupational average wage to U.S. overall average wage – 1) * 100. The occupational group totals
are calculated as the sum of the occupational values within each group.
*** Formula 2: (Change over time in occupational share of Arizona employment) * (ratio of national
occupational average wage to U.S. overall average wage – 1) * 100. The occupational group totals
are calculated as the sum of the occupational values within each group.

Source: Calculated from U.S. Department of Labor, Bureau of Labor Statistics, Occupational Employment
Statistics.

24

LE 13
2001-04 CHANGE IN OCCUPATIONAL JOB MIX BY OCCUPATION: ARIZONA
All Occupations with a Change in Job Mix of at Least 0.05

Occupation
Gain in Occupational Share & Above Average Wage
Financial Managers
Miscellaneous Health Professionals and Technicians
Miscellaneous Managers
Elementary School Teachers
Mechanical Engineers
General Physicians
Insurance Sales Agents
Sales Managers
Electrical Engineers
Loss in Occupational Share & Below Average Wage
Combined Food Preparation and Serving
Farmworkers
Home Health Aides
Child Care Workers
Team Assemblers
Security Guards
Amusement and Recreation Attendants
Landscaping and Groundskeeping
Gain in Occupational Share & Below Average Wage
Hand Laborers
Food Preparation Workers
Customer Service Representatives
Counter Attendants, Food Services
Personal and Home Care Aides
Shipping Clerks
Cooks, Fast Food
Miscellaneous Construction Workers
Loss in Occupational Share & Above Average Wage
Computer Systems Analysts
General and Operations Managers
Sales Representatives, Technical and Scientific
Construction Supervisors
Registered Nurses
Computer Software Engineers, Systems
Miscellaneous Architects and Engineers
Industrial Engineers
Subtotal with a Positive Change in Job Mix
Subtotal with a Negative Change in Job Mix
Occupations Not Shown
TOTAL

Change in
Job Mix*

Ratio of 2004
Average
Wage to Total,
U.S.

Change in
Occupational
Share,
Difference
from U.S.

0.10
0.08
0.08
0.08
0.08
0.07
0.06
0.06
0.06

2.52
2.81
2.17
1.24
1.86
3.69
1.50
2.59
2.02

0.06
0.08
0.07
0.32
0.09
0.03
0.13
0.02
0.05

0.22
0.06
0.06
0.06
0.06
0.05
0.05
0.05

0.41
0.46
0.51
0.48
0.69
0.60
0.45
0.59

-0.40
-0.12
-0.13
-0.12
-0.18
-0.13
-0.10
-0.15

-0.10
-0.09
-0.08
-0.08
-0.07
-0.07
-0.06
-0.05

0.51
0.48
0.78
0.44
0.47
0.70
0.41
0.91

0.25
0.17
0.32
0.16
0.15
0.25
0.11
0.31

-0.11
-0.09
-0.08
-0.07
-0.07
-0.06
-0.05
-0.05

1.86
2.50
1.81
1.46
1.49
2.23
1.68
1.81

-0.12
-0.00
-0.11
-0.15
-0.08
-0.05
-0.10
-0.06

1.28
-1.18
-0.45
-0.35

-0.48
1.05
-0.57
0.00

* The difference in the 2001 and 2004 job mix values, with the value for each year calculated from
formula 1: (difference in occupational share of employment between Arizona and the nation) * (ratio of
national occupational average wage to U.S. overall average wage – 1) * 100.
Source: Calculated from U.S. Department of Labor, Bureau of Labor Statistics, Occupational Employment
Statistics.

25

TABLE 14
2001-04 CHANGE IN JOB QUALITY SCORES BY OCCUPATION:
ARIZONA AND THE UNITED STATES
Occupations with a Difference in Score of at Least 0.05
Between the Nation and Arizona
Occupation
Positive Difference
Combined Food Preparation and Serving
Miscellaneous Health Professionals and Technicians
Elementary School Teachers
Mechanical Engineers
Miscellaneous Management
Financial Managers
General Physicians
Farmworkers
Child Care Workers
Landscaping and Groundskeeping
Electrical Engineers
Home Health Aides
Team Assemblers
Insurance Sales Agents
Amusement and Recreation Attendants
Security Guards
Negative Difference
Computer Systems Analysts
Hand Laborers
Food Preparation Workers
Counter Attendants, Food Services
Sales Representatives, Scientific and Technical
Personal and Home Care Aides
Shipping Clerks
Construction Supervisors
Janitors and Cleaners
Computer Software Engineers, Systems
Customer Service Representatives
Cooks, Fast Food
Miscellaneous Architects and Engineers
Industrial Engineers
Subtotal with a Positive Difference
Subtotal with a Negative Difference
Occupations Not Shown
TOTAL

Arizona*

Nation**

Difference

0.16
0.11
0.08
0.09
-0.11
-0.01
0.01
0.06
0.02
0.03
0.05
0.04
0.04
0.06
0.04
0.06

-0.07
0.01
-0.01
0.01
-0.19
-0.08
-0.05
-0.01
-0.04
-0.03
-0.00
-0.02
-0.01
0.00
-0.01
0.00

0.23
0.10
0.09
0.08
0.07
0.07
0.06
0.06
0.06
0.06
0.06
0.06
0.05
0.05
0.05
0.05

-0.08
-0.18
-0.09
-0.11
-0.08
-0.13
-0.06
-0.06
-0.07
-0.01
-0.08
-0.08
-0.16
-0.04

0.03
-0.08
-0.00
-0.02
0.01
-0.06
0.01
0.01
-0.01
0.05
-0.02
-0.02
-0.10
0.01

-0.11
-0.10
-0.09
-0.08
-0.08
-0.07
-0.07
-0.07
-0.06
-0.06
-0.06
-0.06
-0.06
-0.05

0.73
-1.23
-0.68
-1.18

-0.50
-0.19
-0.30
-0.99

1.20
-1.02
-0.38
-0.20

* Formula 2: (Change over time in occupational share of Arizona employment) * (ratio of the national
occupational average wage to U.S. overall average wage – 1) * 100.
** Formula 2: (Change over time in occupational share of U.S. employment) * (ratio of the national
occupational average wage to U.S. overall average wage – 1) * 100. Since the list of occupations was
limited to those available for Arizona, these figures do not match those from the section “Results for the
United States.”
Source: Calculated from U.S. Department of Labor, Bureau of Labor Statistics, Occupational Employment
Statistics.

26

RESULTS FOR ALL STATES
This section presents the overall results for industrial, occupational, and total job mix,
both for 2004 and the change between 2001 and 2004. The states (including the District of
Columbia) are ranked on each of these measures. The U.S. average is quite different from the
value for the median (26th) state on some of the measures because of the wide differences in size
among the states. For example, employment in California is greater than the combined
employment of the 21 smallest states.
Industrial Job Quality
The various measures of industrial job quality are summarized by state in Table 15. The
values in the three columns related to industrial mix — all expressed relative to the national
average — are calculated from formula 1 while the values in the other three columns are
calculated from formula 2. The change in industrial mix and difference in score from U.S.
columns — both expressed relative to the U.S. average — represent the alternative ways of
measuring the change in industrial job quality relative to the nation between 2001 and 2004. In
40 of the states, the values are within 0.3 of each other. The two columns providing the state
score are not expressed relative to the nation. They show the total change in the industrial job
quality score over the three years. As seen in the state score (U.S. wage) column, only two states
— Wyoming and Nebraska — experienced an improvement in industrial job quality between
2001 and 2004. Since the calculation of the state score (state wage) is affected by factors other
than the change in job quality (such as living costs), the last column of the table should not be
used to compare states on job quality.
Industrial Mix in 2004
The states are ranked on industrial mix in 2004 (expressed relative to the national
average) in Table 16. Only 14 states — including several of the most populous — had an
industrial mix in 2004 that had a positive effect on the state’s average wage relative to the
national average. The median state — Alabama — had a value of –2.0.
The seven states with the strongest industrial mixes in 2004 are located along the
northern-to-central Atlantic Coast stretching from Massachusetts to Virginia. Maryland, ranked
11th, also is in this region. The only other states with a positive industrial mix value were
Colorado, Texas, California and Utah in the West; and Illinois and Minnesota in the mid-section
of the country. States with the weakest industrial mixes were scattered around the country. The
states with the lowest job quality were Nevada and Hawaii, both with a high percentage of lowpaying tourism-related jobs. Other states with weak figures were in the northern Rocky
Mountains, northern Great Plains, northern New England, and the South.
The impact on the overall industrial mix varied widely among the 20 sectors. The median
industrial mix value among the 51 states was positive in only six of the 20 sectors. Most of the
sectors with an average wage close to the overall average wage — including construction,
educational services, transportation, and real estate — accounted for little of the state-to-state
variation in the overall industrial job mix. However, if a wide range in average wage by industry
within a sector existed and if the geographic distribution of jobs was not evenly distributed
across the country, even these sectors with an average wage close to the overall figure could
account for some of the geographic variation in the industrial mix. This was true of the
government sector, due to the geographic clustering of high-wage federal government
employment, and of the health practitioners and technical sector, due to a wide disparity in
27

TABLE 15
INDUSTRIAL JOB QUALITY BY STATE
Industrial Mix*

Alabama
Alaska
Arizona
Arkansas
California
Colorado
Connecticut
Delaware
District of Columbia
Florida
Georgia
Hawaii
Idaho
Illinois
Indiana
Iowa
Kansas
Kentucky
Louisiana
Maine
Maryland
Massachusetts
Michigan
Minnesota
Mississippi
Missouri
Montana
Nebraska
Nevada
New Hampshire
New Jersey
New Mexico
New York
North Carolina
North Dakota
Ohio
Oklahoma
Oregon
Pennsylvania
Rhode Island
South Carolina
South Dakota
Tennessee
Texas
Utah
Vermont
Virginia
Washington
West Virginia
Wisconsin
Wyoming
32B

2001
-2.72
-2.24
-1.20
-4.13
2.15
3.01
4.00
4.76
17.25
-5.49
0.61
-9.78
-3.46
1.72
-3.66
-6.13
-0.63
-3.32
-2.03
-4.83
0.89
8.56
-1.19
1.53
-7.13
-1.50
-8.46
-4.08
-9.97
-0.45
6.37
-3.87
6.55
-3.40
-3.77
-2.36
-2.56
-2.77
-0.89
-3.12
-6.00
-6.18
-3.56
1.44
1.04
-6.45
3.00
-0.89
-3.69
-4.28
-4.82

2004
-1.97
-1.98
-1.55
-2.85
1.06
1.79
4.61
5.90
21.37
-4.76
-0.05
-8.56
-3.75
1.68
-2.78
-4.62
-0.59
-2.61
-1.79
-4.86
1.55
6.51
-0.67
1.62
-6.43
-0.94
-7.59
-2.34
-9.66
-1.31
5.16
-3.58
5.41
-2.66
-2.32
-1.58
-1.25
-3.22
-0.30
-1.99
-5.56
-5.13
-2.60
1.34
0.73
-6.21
3.34
-1.25
-2.62
-2.93
-2.60

2001-04
Change
0.76
0.26
-0.34
1.28
-1.08
-1.22
0.62
1.15
4.12
0.73
-0.66
1.22
-0.30
-0.04
0.88
1.50
0.04
0.72
0.24
-0.03
0.66
-2.06
0.53
0.10
0.70
0.57
0.88
1.74
0.31
-0.87
-1.21
0.29
-1.14
0.74
1.44
0.77
1.31
-0.45
0.59
1.13
0.44
1.05
0.96
-0.10
-0.31
0.23
0.34
-0.36
1.06
1.35
2.22

Difference
in Score
from U.S.**
0.73
-0.08
-0.12
1.13
-0.93
-0.76
0.09
0.33
1.24
0.89
-0.33
1.17
-0.22
-0.15
0.51
1.37
-0.13
0.58
0.37
-0.19
0.76
-2.19
0.39
-0.00
0.72
0.36
0.85
1.66
0.64
-0.51
-1.24
0.23
-1.15
0.76
1.20
0.54
1.20
-0.42
0.32
0.99
0.52
0.55
0.71
0.07
-0.09
0.38
0.62
0.31
0.82
1.10
2.36

(continued on next page)

28

State Score
(U.S.
Wage)***
-0.82
-1.31
-1.66
-0.27
-2.52
-2.34
-1.42
-1.08
-0.18
-0.70
-1.91
-0.24
-1.74
-1.75
-1.05
-0.15
-1.62
-0.94
-1.18
-1.61
-0.82
-3.76
-1.18
-1.55
-0.76
-1.16
-0.58
0.17
-0.84
-2.05
-2.81
-1.23
-2.71
-0.77
-0.23
-1.04
-0.29
-2.01
-1.25
-0.37
-0.92
-0.87
-0.81
-1.52
-1.65
-0.96
-0.95
-1.27
-0.59
-0.48
1.00

State Score
(State
Wage)****
-1.01
-2.46
-1.23
-0.01
-2.44
-2.20
-0.87
-3.92
-1.78
-0.45
-1.74
-0.14
-2.06
-1.53
-0.99
-0.33
-1.43
-1.17
-1.42
-1.39
-0.74
-3.25
-1.46
-1.32
-0.77
-1.36
-0.81
0.33
0.12
-1.79
-2.44
-0.85
-3.15
-1.17
-0.02
-1.12
-0.58
-1.38
-1.12
-1.88
-1.23
-0.98
-0.60
-1.87
-1.19
-1.29
-1.12
-1.22
-1.59
-0.66
-3.20

TABLE 15 (continued)
*

Formula 1: Sum over all industries of ((state – U.S. employment share) * (ratio of U.S. average wage
to overall U.S. average wage – 1) * 100).

** The figures in this column are an alternative to those in the column to the left (2001-04 change in
industrial mix). This column is calculated as the difference between the value in the column to the
right (the state score calculated using national wages) and the national score calculated from formula
2: Sum over all industries of ((change over time in sectoral share of U.S. employment) * (ratio of U.S.
average wage to overall U.S. average wage – 1) * 100).
*** Formula 2: Sum over all industries of ((change over time in sectoral share of state employment) *
(ratio of U.S. average wage to overall U.S. average wage – 1) * 100).
**** States should not be compared on the basis of this column, calculated from formula 2: Sum over all
industries of ((change over time in sectoral share of state employment) * (ratio of state average wage
to overall state average wage – 1) * 100).
Source: Calculated from U.S. Department of Labor, Bureau of Labor Statistics, Census of Employment
and Wages.

29

TABLE 16
2004 INDUSTRIAL MIX* RANKED BY STATE
1.
2.
3.
4.
5.
6.
7.
8.
9.
10.
11.
12.
13.
14.
15.
16.
17.
18.
19.
20.
21.
22.
23.
24.
25.
26.

District of Columbia
Massachusetts
Delaware
New York
New Jersey
Connecticut
Virginia
Colorado
Illinois
Minnesota
Maryland
Texas
California
Utah
Georgia
Pennsylvania
Kansas
Michigan
Missouri
Washington
Oklahoma
New Hampshire
Arizona
Ohio
Louisiana
Alabama

21.4
6.5
5.9
5.4
5.2
4.6
3.3
1.8
1.7
1.6
1.6
1.3
1.1
0.7
-0.1
-0.3
-0.6
-0.7
-0.9
-1.3
-1.3
-1.3
-1.6
-1.6
-1.8
-2.0

27.
28.
29.
30.
31.
32.
33.
34.
35.
36.
37.
38.
39.
40.
41.
42.
43.
44.
45.
46.
47.
48.
49.
50.
51.

Alaska
Rhode Island
North Dakota
Nebraska
West Virginia
Tennessee
Wyoming
Kentucky
North Carolina
Indiana
Arkansas
Wisconsin
Oregon
New Mexico
Idaho
Iowa
Florida
Maine
South Dakota
South Carolina
Vermont
Mississippi
Montana
Hawaii
Nevada

-2.0
-2.0
-2.3
-2.3
-2.6
-2.6
-2.6
-2.6
-2.7
-2.8
-2.9
-2.9
-3.2
-3.6
-3.8
-4.6
-4.8
-4.9
-5.1
-5.6
-6.2
-6.4
-7.6
-8.6
-9.7

* Formula 1: Sum over all industries of ((state – U.S. employment share) * (ratio of U.S. average
wage to overall U.S. average wage – 1) * 100).
Source: Calculated from U.S. Department of Labor, Bureau of Labor Statistics, Census of
Employment and Wages.

30

wages within the sector and the geographic clustering of some of the very highly paid specialty
jobs.
Some sectors with an average wage considerably different from the national average had
little effect on the state-to-state variation in the overall industrial mix because of a small sectoral
share of employment that did not vary substantially across states. Agriculture; other services; and
arts, entertainment and recreation were low-paying sectors with little impact, while utilities was a
high-paying sector with little effect, on the variation in the overall industrial mix.
Those sectors with a strong geographic concentration and with wages considerably
different from the overall average were largely responsible for the state-to-state variations in
industrial mix. The low-paying administrative support, retail trade, and accommodation and food
services sectors had a moderate effect on the geographic variation in the overall industrial mix.
Most of the extreme state values in the administrative support sector were positive, indicating
that a number of states had relatively little employment in this low-paying sector. The highpaying wholesale trade and mining sectors also had a moderate effect. Other high-paying sectors
had a larger effect: manufacturing; information; management of companies; professional,
scientific and technical services; and finance and insurance. In each of these, far more states had
a large negative value than a large positive value, showing that many states have little
employment in these high-paid sectors. It is these high-paying sectors — which employ many
highly educated workers, many in high-technology positions — that account for most of the
geographic variation in the industrial job mix.
Change in Industrial Mix between 2001 and 2004
Thirty-six states experienced an increase in industrial mix value between 2001 and 2004,
as seen in Table 17; several populous states were among the minority with a decline. Most of the
states with the greatest improvement over the three years still had below-average values in 2004
while many of the states with a negative change in job quality over the three years still had a
positive industrial mix in 2004. Some significant exceptions to this general pattern of inverse
change in industrial mix relative to level included Maine, Idaho and Oregon, each with an
industrial mix considerably below average but without improvement between 2001 and 2004. In
contrast, some states with the strongest industrial mixes had a positive change over the three
years, including the District of Columbia, Delaware, Connecticut and Virginia. Nearly every
state not in the West or along the East Coast experienced a gain in industrial mix.
A half-dozen high-paying mostly high-technology sectors caused most of the state-tostate variation in the 2001-04 change in industrial mix: manufacturing; information; finance and
insurance; professional, scientific and technical services; management of companies; and mining.
The very low-paying accommodation and food services sector also added noticeably to the
geographic variation.

31

TABLE 17
2001-04 CHANGE IN INDUSTRIAL MIX* RANKED BY STATE
1.
2.
3.
4.
5.
6.
7.
8.
9.
10.
11.
12.
13.
14.
15.
16.
17.
18.
19.
20.
21.
22.
23.
24.
25.
26.

District of Columbia
Wyoming
Nebraska
Iowa
North Dakota
Wisconsin
Oklahoma
Arkansas
Hawaii
Delaware
Rhode Island
West Virginia
South Dakota
Tennessee
Montana
Indiana
Ohio
Alabama
North Carolina
Florida
Kentucky
Mississippi
Maryland
Connecticut
Pennsylvania
Missouri

4.1
2.2
1.7
1.5
1.4
1.4
1.3
1.3
1.2
1.2
1.1
1.1
1.1
1.0
0.9
0.9
0.8
0.8
0.7
0.7
0.7
0.7
0.7
0.6
0.6
0.6

27.
28.
29.
30.
31.
32.
33.
34.
35.
36.
37.
38.
39.
40.
41.
42.
43.
44.
45.
46.
47.
48.
49.
50.
51.

Michigan
South Carolina
Nevada
Virginia
New Mexico
Alaska
Louisiana
Vermont
Minnesota
Kansas
Maine
Illinois
Texas
Idaho
Utah
Arizona
Washington
Oregon
Georgia
New Hampshire
California
New York
New Jersey
Colorado
Massachusetts

0.5
0.4
0.3
0.3
0.3
0.3
0.2
0.2
0.1
0.0
-0.0
-0.0
-0.1
-0.3
-0.3
-0.3
-0.4
-0.5
-0.7
-0.9
-1.1
-1.1
-1.2
-1.2
-2.1

* Formula 1: The difference in the two years of the sum over all industries of ((state – U.S.
employment share) * (ratio of U.S. average wage to overall U.S. average wage – 1) * 100).
Source: Calculated from U.S. Department of Labor, Bureau of Labor Statistics, Census of
Employment and Wages.

32

Occupational Job Quality
The various measures of occupational job quality are summarized by state in Table 18.
The values in the three columns related to occupational mix — all expressed relative to the
national average — are calculated from formula 1 while the values in the other three columns are
calculated from formula 2. The change in occupational mix and difference in score from U.S.
columns — both expressed relative to the U.S. average — represent the alternative ways of
measuring the change in occupational job quality relative to the nation between 2001 and 2004.
Differences between the two measures are more substantial than in the industrial data. The two
columns providing the state score are not expressed relative to the nation. They show the total
change in the occupational job quality score over the three years. As seen in the state score (U.S.
wage) column, eight states experienced an improvement in occupational job quality between
2001 and 2004, with six by at least 0.5. Since the calculation of the state score (state wage)
column is affected by factors other than the change in job quality (such as living costs), the last
column of the table should not be used to compare states on job quality.
Occupational Mix in 2004
Only 20 states had an occupational mix in 2004 that had a positive effect on the state’s
average wage relative to the national average, with only 14 having a value of at least 1. The
states with the strongest occupational mixes in 2004 are disproportionately located along the
northern-to-central Atlantic Coast, filling nine of the top 15 positions (see Table 19). Outside of
this region, the states with a strong occupational mix were geographically scattered: Alaska,
Idaho, Colorado, Minnesota, Illinois and Georgia. States in the South and Upper Midwest
disproportionately had the weakest occupational mixes, but the worst figure was in Nevada and
the fifth-worst was in Hawaii.
As with the industrial mix, a minority of occupational groups caused most of the
geographic variation in the occupational mix in 2004. The high-paying management, computer
and mathematical, and business and financial operations occupational groups were significant
sources of the variation across states in the occupational mix value in 2004. Most of the extreme
state values in the latter two groups were negative. The architecture and engineering group also
contributed to the geographic variation. Among the low-paying groups, production had the
greatest impact, with food preparation and serving, and transportation also contributing to the
geographic variation. Though its overall average wage was not that much less than the overall
figure, the sales group also was a source of considerable geographic variation. This group has a
mixture of high- and low-paying occupations.
Change in Occupational Mix between 2001 and 2004
Twenty-four states experienced an increase in occupational mix value between 2001 and
2004, though only 11 had a gain of at least 1 (see Table 20). Unlike the industrial mix, in which
the change between 2001 and 2004 was inversely related to the 2004 level in most states, the
change in occupational mix was positively related to its level. The states with the greatest
improvements in occupational mix are scattered across the country, though several states in New
England or along the central Atlantic Coast experienced gains.
In many states, large changes occurred in the occupational mix between 2001 and 2004 in
the management occupational group. The only other groups that contributed even moderately to
the interstate variation were health practitioners and technical, business and financial operations,
and legal. Thus, the management group accounted for much of the interstate variation.

33

TABLE 18
OCCUPATIONAL JOB QUALITY BY STATE

Alabama
Alaska
Arizona
Arkansas
California
Colorado
Connecticut
Delaware
District of Columbia
Florida
Georgia
Hawaii
Idaho
Illinois
Indiana
Iowa
Kansas
Kentucky
Louisiana
Maine
Maryland
Massachusetts
Michigan
Minnesota
Mississippi
Missouri
Montana
Nebraska
Nevada
New Hampshire
New Jersey
New Mexico
New York
North Carolina
North Dakota
Ohio
Oklahoma
Oregon
Pennsylvania
Rhode Island
South Carolina
South Dakota
Tennessee
Texas
Utah
Vermont
Virginia
Washington
West Virginia
Wisconsin
Wyoming
33B

Occupational Mix*
2001-04
2001
2004
Change
-2.31
-3.21
-0.90
3.21
5.39
2.18
-0.15
-0.50
-0.35
-5.86
-6.38
-0.52
0.58
1.32
0.74
3.01
3.30
0.29
3.08
3.99
0.92
2.45
0.92
-1.53
26.92
31.96
5.04
-2.62
-3.67
-1.05
-0.84
0.90
1.74
-6.02
-5.03
0.99
0.00
2.37
2.37
3.21
2.68
-0.54
-4.70
-4.39
0.31
-3.77
-4.88
-1.11
-0.92
-1.48
-0.56
-3.57
-3.62
-0.05
-1.33
-2.62
-1.29
-2.10
-1.88
0.23
6.00
6.48
0.48
5.79
7.61
1.82
-1.05
0.63
1.68
0.15
2.07
1.92
-6.56
-6.19
0.37
-0.59
-2.58
-1.98
-2.00
-2.77
-0.76
-1.82
-2.91
-1.08
-9.66
-10.20
-0.55
0.75
1.91
1.17
0.95
1.85
0.91
0.56
-1.37
-1.93
1.01
2.21
1.20
-1.68
-2.10
-0.42
-4.06
-5.12
-1.06
-1.50
-1.78
-0.28
-0.89
-0.45
0.44
-1.34
-0.72
0.61
0.52
-0.93
-1.45
-1.88
-0.20
1.68
-3.09
-3.67
-0.58
-6.61
-6.85
-0.24
-2.79
-2.38
0.41
1.62
0.20
-1.42
-0.29
0.16
0.45
-3.19
-3.33
-0.14
3.53
3.13
-0.40
1.19
0.19
-1.00
-2.61
-3.80
-1.20
-3.90
-4.12
-0.22
-1.68
-1.44
0.24

Difference
in Score
from U.S.**
-0.45
1.21
-0.20
0.22
0.51
0.17
0.68
-1.64
1.47
-0.80
1.48
1.27
1.93
-0.92
0.90
-0.39
-0.27
0.24
-1.10
0.30
-0.17
0.91
1.71
1.80
0.95
-1.72
-0.74
-0.57
0.40
0.78
0.79
-1.87
0.85
-0.18
-0.59
-0.02
0.31
0.70
-1.33
1.63
-0.36
0.61
0.44
-1.39
0.63
0.60
-0.25
-0.57
-0.65
0.46
0.47

(continued on next page)

34

State Score
(U.S.
Wage)***
-1.38
0.14
-1.18
-0.75
-0.43
-0.79
-0.28
-2.62
0.58
-1.71
0.58
0.32
0.84
-1.87
-0.10
-1.40
-1.26
-0.74
-2.05
-0.70
-1.12
-0.07
0.75
0.81
-0.06
-2.68
-1.78
-1.51
-0.59
-0.21
-0.17
-2.87
-0.05
-1.13
-1.58
-0.96
-0.58
-0.30
-2.28
0.79
-1.27
-0.40
-0.50
-2.32
-0.32
-0.38
-1.18
-1.52
-1.66
-0.54
-0.49

State Score
(State
Wage)****
-1.54
0.27
-1.02
-0.61
-0.10
-0.97
-0.29
-2.81
0.35
-1.87
0.66
0.83
0.55
-1.41
-0.30
-1.26
-1.47
-0.95
-1.97
-0.73
-0.73
-0.02
0.42
0.62
-0.23
-2.51
-1.35
-0.98
-0.27
-0.05
-0.16
-2.56
0.15
-1.20
-1.33
-1.06
-0.80
-0.10
-2.20
1.26
-1.07
-0.52
-0.49
-2.24
0.18
-0.50
-1.31
-1.57
-1.73
-0.77
-0.13

TABLE 18 (continued)
*

Formula 1: Sum over all occupations of ((state – U.S. employment share) * (ratio of U.S. average
wage to overall U.S. average wage – 1) * 100).

** The figures in this column are an alternative to those in the column to the left (2001-04 change in
occupational mix). This column is calculated as the difference between the value in the column to the
right (the state score calculated using national wages) and the national score calculated from formula
2: Sum over all occupations of ((change over time in occupational share of U.S. employment) * (ratio
of U.S. average wage to overall U.S. average wage – 1) * 100).
*** Formula 2: Sum over all occupations of ((change over time in occupational share of state
employment) * (ratio of U.S. average wage to overall U.S. average wage – 1) * 100).
**** States should not be compared on the basis of this column, calculated from formula 2: Sum over all
occupations of ((change over time in occupational share of state employment) * (ratio of state
average wage to overall state average wage – 1) * 100).
Source: Calculated from U.S. Department of Labor, Bureau of Labor Statistics, Occupational Employment
Statistics.

35

TABLE 19
2004 OCCUPATIONAL MIX* RANKED BY STATE
1.
2.
3.
4.
5.
6.
7.
8.
9.
10.
11.
12.
13.
14.
15.
16.
17.
18.
19.
20.
21.
22.
23.
24.
25.
26.

District of Columbia
Massachusetts
Maryland
Alaska
Connecticut
Colorado
Virginia
Illinois
Idaho
New York
Minnesota
New Hampshire
New Jersey
California
Delaware
Georgia
Michigan
Texas
Washington
Utah
Rhode Island
Oklahoma
Arizona
Oregon
Pennsylvania
New Mexico

32.0
7.6
6.5
5.4
4.0
3.3
3.1
2.7
2.4
2.2
2.1
1.9
1.9
1.3
0.9
0.9
0.6
0.2
0.2
0.2
-0.2
-0.5
-0.5
-0.7
-0.9
-1.4

27.
28.
29.
30.
31.
32.
33.
34.
35.
36.
37.
38.
39.
40.
41.
42.
43.
44.
45.
46.
47.
48.
49.
50.
51.

Wyoming
Kansas
Ohio
Maine
North Carolina
Tennessee
Missouri
Louisiana
Montana
Nebraska
Alabama
Vermont
Kentucky
South Carolina
Florida
West Virginia
Wisconsin
Indiana
Iowa
Hawaii
North Dakota
Mississippi
Arkansas
South Dakota
Nevada

-1.4
-1.5
-1.8
-1.9
-2.1
-2.4
-2.6
-2.6
-2.8
-2.9
-3.2
-3.3
-3.6
-3.7
-3.7
-3.8
-4.1
-4.4
-4.9
-5.0
-5.1
-6.2
-6.4
-6.9
-10.2

* Formula 1: Sum over all occupations of ((state – U.S. employment share) * (ratio of U.S. average
wage to overall U.S. average wage – 1) * 100).
Source: Calculated from U.S. Department of Labor, Bureau of Labor Statistics, Occupational
Employment Statistics.

36

TABLE 20
2001-04 CHANGE IN OCCUPATIONAL MIX* RANKED BY STATE
1.
2.
3.
4.
5.
6.
7.
8.
9.
10.
11.
12.
13.
14.
15.
16.
17.
18.
19.
20.
21.
22.
23.
24.
25.
26.

District of Columbia
Idaho
Alaska
Minnesota
Massachusetts
Georgia
Rhode Island
Michigan
New York
New Hampshire
Hawaii
Connecticut
New Jersey
California
Oregon
Maryland
Utah
Oklahoma
Tennessee
Mississippi
Indiana
Colorado
Wyoming
Maine
Kentucky
Vermont

5.0
2.4
2.2
1.9
1.8
1.7
1.7
1.7
1.2
1.2
1.0
0.9
0.9
0.7
0.6
0.5
0.5
0.4
0.4
0.4
0.3
0.3
0.2
0.2
-0.1
-0.1

27.
28.
29.
30.
31.
32.
33.
34.
35.
36.
37.
38.
39.
40.
41.
42.
43.
44.
45.
46.
47.
48.
49.
50.
51.

Wisconsin
South Dakota
Ohio
Arizona
Virginia
North Carolina
Arkansas
Illinois
Nevada
Kansas
South Carolina
Montana
Alabama
Washington
Florida
North Dakota
Nebraska
Iowa
West Virginia
Louisiana
Texas
Pennsylvania
Delaware
New Mexico
Missouri

-0.2
-0.2
-0.3
-0.4
-0.4
-0.4
-0.5
-0.5
-0.6
-0.6
-0.6
-0.8
-0.9
-1.0
-1.1
-1.1
-1.1
-1.1
-1.2
-1.3
-1.4
-1.5
-1.5
-1.9
-2.0

* Formula 1: The difference in the two years of the sum over all occupations of ((state – U.S.
employment share) * (ratio of U.S. average wage to overall U.S. average wage – 1) * 100.
Source: Calculated from U.S. Department of Labor, Bureau of Labor Statistics, Occupational
Employment Statistics.

37

Overall Job Quality
Overall job quality in 2004 is approximated by combining multiplicatively the industrial
mix and occupational mix values. In all but five states, the 2004 industrial mix and occupational
mix values both were either stronger or weaker than the national average. Alaska was the biggest
exception, with a below-average industrial mix but the fourth-strongest occupational mix in the
country. In some states, the combined effect of the industrial and occupational mixes was
substantial. As seen in Table 21, job quality in Massachusetts had a positive effect of more than
14 percent on its overall average wage relative to the national average; the job mix in five states
had a depressing effect on the average wage of at least 10 percent.
Job quality was greater than the national average in only 18 states. The strongest job
quality in 2004 was in the District of Columbia and seven states that border the Atlantic Ocean
from Massachusetts to Virginia. Outside of this region, the strongest job quality was in Illinois
and Colorado. Job quality was almost uniformly weak in the Great Plains and South. In the West
and the Great Lakes region, job quality varied by state from below to above the national average.
The change in industrial mix was not correlated to the change in occupational mix
between 2001 and 2004. Other than most of the states with the strongest change in overall job
quality, most of the states experienced a gain in one measure but a loss in the other measure.
Thus, the overall change in job quality was small in most states. Eight states experienced a gain
of at least 2, but no state had a decline of that magnitude.
Thirty-one states had a positive change in overall job quality between 2001 and 2004,
though the gain was 1 percent or more in only 16 states (see Table 22). Six states had a loss of at
least 1 percent. The change in job quality did not a strong regional pattern, though most of the
northern tier of states posted a gain while losses were sizeable in Louisiana-Texas-New MexicoColorado, extending to Arizona.

38

TABLE 21
2004 OVERALL JOB QUALITY RANKED BY STATE

1.
2.
3.
4.
5.
6.
7.
8.
9.
10.
11.
12.
13.
14.
15.
16.
17.
18.
19.
20.
21.
22.
23.
24.
25.
26.

District of Columbia
Massachusetts
Connecticut
Maryland
New York
New Jersey
Delaware
Virginia
Colorado
Illinois
Minnesota
Alaska
California
Texas
Utah
Georgia
New Hampshire
Michigan
Washington
Pennsylvania
Idaho
Oklahoma
Arizona
Kansas
Rhode Island
Ohio

Total*
60.2
14.6
8.8
8.1
7.7
7.1
6.9
6.6
5.1
4.4
3.7
3.3
2.4
1.5
0.9
0.9
0.6
0.0
-1.1
-1.2
-1.5
-1.7
-2.0
-2.1
-2.2
-3.3

Ind
Mix**
21.4
6.5
4.6
1.6
5.4
5.2
5.9
3.3
1.8
1.7
1.6
-2.0
1.1
1.3
0.7
-0.1
-1.3
-0.7
-1.3
-0.3
-3.8
-1.3
-1.6
-0.6
-2.0
-1.6

Occ
Mix^
32.0
7.6
4.0
6.5
2.2
1.9
0.9
3.1
3.3
2.7
2.1
5.4
1.3
0.2
0.2
0.9
1.9
0.6
0.2
-0.9
2.4
-0.5
-0.5
-1.5
-0.2
-1.8

27.
28.
29.
30.
31.
32.
33.
34.
35.
36.
37.
38.
39.
40.
41.
42.
43.
44.
45.
46.
47.
48.
49.
50.
51.

Missouri
Oregon
Wyoming
Louisiana
North Carolina
New Mexico
Tennessee
Alabama
Nebraska
Kentucky
West Virginia
Maine
Wisconsin
Indiana
North Dakota
Florida
South Carolina
Arkansas
Iowa
Vermont
Montana
South Dakota
Mississippi
Hawaii
Nevada

Total*
-3.5
-3.9
-4.0
-4.4
-4.7
-4.9
-4.9
-5.1
-5.2
-6.1
-6.3
-6.6
-6.9
-7.1
-7.3
-8.3
-9.0
-9.0
-9.3
-9.3
-10.1
-11.6
-12.2
-13.2
-18.9

Ind
Mix**
-0.9
-3.2
-2.6
-1.8
-2.7
-3.6
-2.6
-2.0
-2.3
-2.6
-2.6
-4.9
-2.9
-2.8
-2.3
-4.8
-5.6
-2.9
-4.6
-6.2
-7.6
-5.1
-6.4
-8.6
-9.7

Occ
Mix^
-2.6
-0.7
-1.4
-2.6
-2.1
-1.4
-2.4
-3.2
-2.9
-3.6
-3.8
-1.9
-4.1
-4.4
-5.1
-3.7
-3.7
-6.4
-4.9
-3.3
-2.8
-6.9
-6.2
-5.0
-10.2

* Total is calculated multiplicatively. For example, for the District of Columbia, ((1.214 * 1.320) – 1)*100.
However, the calculation was made with unrounded values.
** Industrial mix: Formula 1: Sum over all industries of ((state – U.S. employment share) * (ratio of U.S.
average wage to overall U.S. average wage – 1) * 100).
^ Occupational Mix: Formula 1: Sum over all occupations of ((state – U.S. employment share) * (ratio of
U.S. average wage to overall U.S. average wage – 1) * 100).
Source: Calculated from U.S. Department of Labor, Bureau of Labor Statistics, Census of Employment
and Wages and Occupational Employment Statistics.

39

TABLE 22
2001-04 CHANGE IN OVERALL JOB QUALITY RANKED BY STATE

1.
2.
3.
4.
5.
6.
7.
8.
9.
10.
11.
12.
13.
14.
15.
16.
17.
18.
19.
20.
21.
22.
23.
24.
25.
26.

District of Columbia
Rhode Island
Wyoming
Alaska
Michigan
Hawaii
Minnesota
Idaho
Oklahoma
Connecticut
Tennessee
Maryland
Indiana
Wisconsin
Georgia
Mississippi
South Dakota
Arkansas
Nebraska
Kentucky
Ohio
Iowa
North Dakota
North Carolina
New Hampshire
Maine

Total*
11.3
2.8
2.4
2.4
2.2
2.1
2.1
2.0
1.7
1.6
1.3
1.2
1.1
1.1
1.1
1.0
0.8
0.7
0.7
0.6
0.5
0.4
0.4
0.3
0.3
0.2

Ind
Mix**
4.1
1.1
2.2
0.3
0.5
1.2
0.1
-0.3
1.3
0.6
1.0
0.7
0.9
1.4
-0.7
0.7
1.1
1.3
1.7
0.7
0.8
1.5
1.4
0.7
-0.9
-0.0

Occ
Mix^
5.0
1.7
0.2
2.2
1.7
1.0
1.9
2.4
0.4
0.9
0.4
0.5
0.3
-0.2
1.7
0.4
-0.2
-0.5
-1.1
-0.1
-0.3
-1.1
-1.1
-0.4
1.2
0.2

27.
28.
29.
30.
31.
32.
33.
34.
35.
36.
37.
38.
39.
40.
41.
42.
43.
44.
45.
46.
47.
48.
49.
50.
51.

Montana
Oregon
Utah
New York
Vermont
Virginia
South Carolina
West Virginia
Alabama
Nevada
Massachusetts
New Jersey
Florida
California
Delaware
Kansas
Illinois
Arizona
Pennsylvania
Colorado
Louisiana
Washington
Missouri
Texas
New Mexico

Total*
0.2
0.1
0.1
0.1
0.1
-0.1
-0.1
-0.1
-0.1
-0.2
-0.3
-0.3
-0.3
-0.3
-0.4
-0.5
-0.6
-0.7
-0.9
-1.0
-1.0
-1.4
-1.4
-1.5
-1.6

Ind
Mix**
0.9
-0.5
-0.3
-1.1
0.2
0.3
0.4
1.1
0.8
0.3
-2.1
-1.2
0.7
-1.1
1.2
0.0
-0.0
-0.3
0.6
-1.2
0.2
-0.4
0.6
-0.1
0.3

Occ
Mix^
-0.8
0.6
0.5
1.2
-0.1
-0.4
-0.6
-1.2
-0.9
-0.6
1.8
0.9
-1.1
0.7
-1.5
-0.6
-0.5
-0.4
-1.5
0.3
-1.3
-1.0
-2.0
-1.4
-1.9

* Total is calculated as the difference between total job quality in 2004 (Table 21) and total job quality in
2001.
** Industrial mix: The difference in the 2001 and 2004 job mix values calculated from Formula 1: Sum
over all industries of ((state – U.S. employment share) * (ratio of U.S. average wage to overall U.S.
average wage – 1) * 100).
^ Occupational Mix: The difference in the 2001 and 2004 job mix values calculated from Formula 1: Sum
over all occupations of ((state – U.S. employment share) * (ratio of U.S. average wage to overall U.S.
average wage – 1) * 100).
Source: Calculated from U.S. Department of Labor, Bureau of Labor Statistics, Census of Employment
and Wages and Occupational Employment Statistics.

40

Average Wage After Adjusting for Job Quality
The annual average wage reported in the Census of Employment and Wages is
considerably different from that reported in the Occupational Employment Survey nationally and
in most states. While the CEW is a census of all covered employers, the average wage is not
adjusted for the number of hours worked. The OES does make that adjustment, but its average
wage is subject to survey error.
Nationally, the CEW average wage in 2004 of $39,354 was 5.1 percent higher than the
OES figure of $37,440. Assuming no survey error or other methodological difference, this
suggests that the net impact on the average wage of those working more than 40 hours per week
is greater than the effect of those working fewer than 40 hours per week. However, in 21 states,
the CEW average wage was less than the OES figure, suggesting a larger impact from those
working part time and/or seasonally. Most of the 21 states with a lower CEW than OES figure
are located in the West (but not California, Nevada and Arizona) or Great Plains regions.
In 40 states, job quality accounted for a portion of the average wage differential from the
national average, whether the differential was positive or negative. In particular, in 26 of these
states, the average wage according to both the CEW and OES measures was less than the
national average but the negative differential became smaller after adjusting for job quality. In
several states, the differential from the national average became greater after adjusting for job
quality while in a few states the sign of the differential changed.
Job quality is just one of several factors that affect wage levels. Major factors other than
job quality that affect the average wage include
• Productivity: the greater the productivity of a state’s workforce, the higher the wages.
• Cost of living: the higher the cost of living, the higher the wages.
• The desirability of the area: the more desirable the area, the lower the wages.
While both the average wage and the average wage adjusted for job quality are affected by the
cost of living, it would be misleading to fully adjust the average wage figures for living costs
even if reliable cost-of-living indexes were available by state, since geographic variations in
living costs are not the only factor causing the average wage figures to vary by state. Dumond et.
al. (1999) suggested that 40 percent of the variation in average wage can be attributed to the cost
of living.
Substantial differences in the average wage exist across states even after controlling for
the effects of job quality (see the two rightmost columns in Table 23). Given the lack of statelevel data for each of the factors affecting the average wage adjusted for job quality and the
interrelated nature of each of these factors, it is not possible to provide much insight into the
reasons for the geographic variations in the average wage after adjustment for job quality.
However, the results suggest that cost of living plays a significant role. For example, most of the
17 states with an OES average wage greater than the national average after adjustment for job
quality are located in the West (particularly along the Pacific Coast) or along the Atlantic Coast
from Massachusetts to Maryland, the regions of the country generally recognized as being the
most costly.
Relative to the national average, the 2001-to-2004 change in OES average wage after
adjusting for job quality was positive in 15 states (see Table 24). No strong regional pattern
existed.

41

TABLE 23
2004 AVERAGE WAGE AND JOB QUALITY BY STATE
Expressed as a Percentage Point Difference from the National Average
See following page
for description of
columns
Alabama
Alaska
Arizona
Arkansas
California
Colorado
Connecticut
Delaware
District of Columbia
Florida
Georgia
Hawaii
Idaho
Illinois
Indiana
Iowa
Kansas
Kentucky
Louisiana
Maine
Maryland
Massachusetts
Michigan
Minnesota
Mississippi
Missouri
Montana
Nebraska
Nevada
New Hampshire
New Jersey
New Mexico
New York
North Carolina
North Dakota
Ohio
Oklahoma
Oregon
Pennsylvania
Rhode Island
South Carolina
South Dakota
Tennessee
Texas
Utah
Vermont
Virginia
Washington
West Virginia
Wisconsin
Wyoming
34B

Average Wage
CEW
OES
-15.1
-14.7
-0.7
12.6
-6.9
-6.8
-23.1
-21.0
13.4
12.1
2.3
6.4
29.6
18.6
8.0
4.3
62.3
54.9
-10.6
-9.9
-3.8
-4.3
-10.6
-1.8
-24.1
-12.5
7.4
3.0
-11.8
-9.7
-18.4
-14.6
-16.8
-9.8
-15.7
-14.1
-19.0
-16.6
-18.9
-10.6
8.2
10.5
24.3
21.0
2.6
5.7
2.7
6.4
-27.5
-23.5
-11.5
-8.0
-29.3
-20.2
-19.9
-11.7
-5.7
-8.4
-0.5
0.0
22.1
15.0
-20.2
-11.9
26.9
16.4
-11.6
-8.9
-26.3
-18.2
-7.4
-4.1
-21.9
-16.8
-9.5
-1.2
-2.0
-3.9
-4.3
2.1
-19.1
-14.7
-28.1
-22.3
-11.3
-12.6
-2.1
-5.7
-18.3
-8.9
-15.4
-7.5
3.0
4.5
0.0
9.1
-22.8
-18.6
-11.7
-5.9
-20.7
-13.2

Job Quality
Indust Mix
Occup Mix
-2.0
-3.2
-2.0
5.4
-1.6
-0.5
-2.9
-6.4
1.1
1.3
1.8
3.3
4.6
4.0
5.9
0.9
21.4
32.0
-4.8
-3.7
-0.1
0.9
-8.6
-5.0
-3.8
2.4
1.7
2.7
-2.8
-4.4
-4.6
-4.9
-0.6
-1.5
-2.6
-3.6
-1.8
-2.6
-4.9
-1.9
1.6
6.5
6.5
7.6
-0.7
0.6
1.6
2.1
-6.4
-6.2
-0.9
-2.6
-7.6
-2.8
-2.3
-2.9
-9.7
-10.2
-1.3
1.9
5.2
1.9
-3.6
-1.4
5.4
2.2
-2.7
-2.1
-2.3
-5.1
-1.6
-1.8
-1.3
-0.5
-3.2
-0.7
-0.3
-0.9
-2.0
-0.2
-5.6
-3.7
-5.1
-6.9
-2.6
-2.4
1.3
0.2
0.7
0.2
-6.2
-3.3
3.3
3.1
-1.3
0.2
-2.6
-3.8
-2.9
-4.1
-2.6
-1.4

(continued on next page)

42

Average Wage after
Adjustment for Job Quality
CEW
OES
-10.5
-10.1
-3.9
9.0
-4.9
-4.9
-15.5
-13.2
10.8
9.5
-2.7
1.1
19.1
9.0
1.0
-2.4
1.4
-3.3
-2.5
-1.7
-4.6
-5.1
3.0
13.0
-23.0
-11.2
2.9
-1.3
-5.2
-2.8
-10.1
-5.8
-15.1
-7.9
-10.2
-8.5
-15.3
-12.8
-13.2
-4.2
0.0
2.2
8.5
5.5
2.6
5.8
-1.0
2.6
-17.4
-12.9
-8.3
-4.6
-21.3
-11.2
-15.6
-6.9
16.2
12.9
-1.0
-0.5
14.0
7.3
-16.1
-7.3
17.8
8.1
-7.2
-4.4
-20.5
-11.8
-4.2
-0.8
-20.5
-15.4
-5.8
2.8
-0.8
-2.7
-2.2
4.4
-11.1
-6.2
-18.7
-12.1
-6.7
-8.1
-3.6
-7.1
-19.0
-9.7
-6.7
2.1
-3.4
-1.9
1.1
10.3
-17.6
-13.1
-5.1
1.1
-17.4
-9.5

TABLE 23 (continued)
Description of Columns:
Average Wage – CEW: Using the Census of Employment and Wages, the percentage difference in the
state average wage from the national average wage. This average wage is based on a census of all
covered employers, but is not adjusted for the number of hours worked.
Average Wage – OES: Using the Occupational Employment Survey, the percentage difference in the
state average wage from the national average wage. This average wage is adjusted for the number of
hours worked but is based on a survey of employers.
Job Quality – Industrial Mix: Formula 1: Sum over all industries of (state – U.S. employment share) * (ratio
of U.S. average wage to overall U.S. average wage – 1) * 100.
Job Quality – Occupational Mix: Formula 1: Sum over all occupations of (state – U.S. employment share)
* (ratio of U.S. average wage to overall U.S. average wage – 1) * 100.
Average Wage after Adjustment for Job Quality – CEW: Uses the average wage from the Census of
Employment and Wages. Calculated using ratios of the national average: average wage divided by
industrial mix divided by occupational mix. For example, for Alabama: 0.849/0.980/0.968 = 0.895, or –
10.5 percent (using unrounded data).
Average Wage after Adjustment for Job Quality – OES: Uses the average wage from the Occupational
Employment Survey. Calculated using ratios of the national average: average wage divided by industrial
mix divided by occupational mix. For example, for Alabama: 0.853/0.980/0.968 = 0.899, or –10.1 percent
(using unrounded data).
Source: Calculated from U.S. Department of Labor, Bureau of Labor Statistics, Census of Employment
and Wages and Occupational Employment Statistics.

43

TABLE 24
2001-04 CHANGE IN AVERAGE WAGE AND JOB QUALITY BY STATE
Expressed as a Percentage Point Difference from the National Average
See following page
for description of
columns
Alabama
Alaska
Arizona
Arkansas
California
Colorado
Connecticut
Delaware
District of Columbia
Florida
Georgia
Hawaii
Idaho
Illinois
Indiana
Iowa
Kansas
Kentucky
Louisiana
Maine
Maryland
Massachusetts
Michigan
Minnesota
Mississippi
Missouri
Montana
Nebraska
Nevada
New Hampshire
New Jersey
New Mexico
New York
North Carolina
North Dakota
Ohio
Oklahoma
Oregon
Pennsylvania
Rhode Island
South Carolina
South Dakota
Tennessee
Texas
Utah
Vermont
Virginia
Washington
West Virginia
Wisconsin
Wyoming
35B

Average Wage
CEW
OES
2.3
-1.9
-0.7
-2.0
1.0
-1.6
2.3
-0.5
-0.7
1.2
-2.6
0.4
-0.2
1.0
1.9
-1.1
5.6
7.2
2.8
-0.9
-0.9
0.3
3.9
1.2
-1.1
-1.3
-0.5
0.2
0.5
-1.2
2.6
-1.0
-0.1
-1.2
1.8
-3.0
0.7
-2.1
2.0
0.8
2.6
2.4
0.1
3.8
-1.0
-0.2
1.7
2.8
1.4
-1.2
-1.2
-1.0
1.8
-1.8
2.3
0.5
3.3
-1.4
1.7
3.9
-0.3
0.3
0.7
0.1
-1.8
1.2
-0.1
-1.4
4.1
1.1
0.8
-0.2
1.0
-1.3
-1.4
-0.9
1.5
-2.0
3.3
1.4
0.1
-2.4
1.8
-2.0
2.1
-1.8
-1.9
-0.9
-1.7
-1.1
1.3
-1.1
1.6
3.0
-3.6
-1.6
-0.1
-1.1
1.5
-0.5
2.6
0.2

Job Quality
Indust Mix
Occup Mix
0.8
-0.9
0.3
2.2
-0.3
-0.4
1.3
-0.5
-1.1
0.7
-1.2
0.3
0.6
0.9
1.2
-1.5
4.1
5.0
0.7
-1.1
-0.7
1.7
1.2
1.0
-0.3
2.4
-0.0
-0.5
0.9
0.3
1.5
-1.1
0.0
-0.6
0.7
-0.1
0.2
-1.3
-0.0
0.2
0.7
0.5
-2.1
1.8
0.5
1.7
0.1
1.9
0.7
0.4
0.6
-2.0
0.9
-0.8
1.7
-1.1
0.3
-0.6
-0.9
1.2
-1.2
0.9
0.3
-1.9
-1.1
1.2
0.7
-0.4
1.4
-1.1
0.8
-0.3
1.3
0.4
-0.5
0.6
0.6
-1.5
1.1
1.7
0.4
-0.6
1.1
-0.2
1.0
0.4
-0.1
-1.4
-0.3
0.5
0.2
-0.1
0.3
-0.4
-0.4
-1.0
1.1
-1.2
1.4
-0.2
2.2
0.2

(continued on next page)

44

Average Wage after
Adjustment for Job Quality
CEW
OES
2.0
-1.4
-2.9
-4.6
1.5
-0.7
1.1
-1.0
-0.3
1.5
-1.4
1.3
-1.9
-0.6
2.2
-0.5
-2.4
-0.9
2.8
-0.5
-1.8
-0.7
1.2
-1.4
-2.4
-2.9
0.1
0.7
-0.7
-2.3
1.8
-1.3
0.4
-0.5
0.9
-3.2
1.5
-0.7
1.5
0.6
1.3
1.1
0.3
3.7
-3.0
-2.5
-0.4
0.6
0.1
-1.9
0.3
0.5
1.2
-1.6
1.2
-0.2
3.8
-1.1
1.3
3.1
0.1
0.6
2.0
1.6
-2.1
1.1
-0.3
-1.5
2.6
0.6
0.2
-0.7
-0.6
-2.5
-1.3
-0.9
2.3
-0.9
0.2
-1.6
0.3
-1.9
0.6
-2.3
0.5
-2.8
-0.2
0.7
-1.4
-1.0
1.1
-1.1
1.5
2.7
-2.0
-0.1
0.1
-0.7
0.2
-1.6
-0.1
-2.1

TABLE 24 (continued)
Description of Columns:
Average Wage – CEW: Using the Census of Employment and Wages, the percentage difference in the
change in the state average wage from the national average wage. This average wage is based on a
census of all covered employers, but is not adjusted for the number of hours worked.
Average Wage – OES: Using the Occupational Employment Survey, the percentage difference in the
change in the state average wage from the national average wage. This average wage is adjusted for the
number of hours worked but is based on a survey of employers.
Job Quality – Industrial Mix: Formula 1: Sum over all industries of ((state – U.S. employment share) *
(ratio of U.S. average wage to overall U.S. average wage – 1) * 100) for 2004 less 2001.
Job Quality – Occupational Mix: Formula 1: Sum over all occupations of ((state – U.S. employment share)
* (ratio of U.S. average wage to overall U.S. average wage – 1) * 100) for 2004 less 2001.
Average Wage after Adjustment for Job Quality – CEW: Uses the average wage from the Census of
Employment and Wages. The difference between 2004 and 2001 in the adjusted average wage.
Average Wage after Adjustment for Job Quality – OES: Uses the average wage from the Occupational
Employment Survey. The difference between 2004 and 2001 in the adjusted average wage.
Source: Calculated from U.S. Department of Labor, Bureau of Labor Statistics, Quarterly Census of
Employment and Wages and Occupational Employment Statistics.

45

THE PRODUCTIVITY AND PROSPERITY PROJECT
The Productivity and Prosperity Project: An Analysis of Economic Competitiveness (P3) is an ongoing
initiative begun in 2005, sponsored by Arizona State University president Michael M. Crow. P3 analyses
incorporate literature reviews, existing empirical evidence, and economic and econometric analyses.
Enhancing productivity is the primary means of attaining economic prosperity. Productive individuals
and businesses are the most competitive and prosperous. Competitive regions attract and retain these
productive workers and businesses, resulting in strong economic growth and high standards of living. An
overarching objective of P3’s work is to examine competitiveness from the perspective of an individual, a
business, a region, and a country.

THE CENTER FOR COMPETITIVENESS
AND PROSPERITY RESEARCH
The Center for Competitiveness and Prosperity Research is a research unit of the L. William Seidman
Research Institute in the W. P. Carey School of Business at Arizona State University. The Center
administers the Productivity and Prosperity Project: An Analysis of Economic Competitiveness (P3), and
the Office of the University Economist. These ongoing initiatives began in 2005 and are sponsored by
university president Michael M. Crow.
Specializing in applied economic and demographic research with a geographic emphasis on Arizona and
the metropolitan Phoenix area, the Center also conducts research projects under sponsorship of private
businesses, nonprofit organizations, government entities, and other ASU units.

C enter for C ompetitiveness and P rosperity R esearch
L . W illiam S eidman R esearch I nstitute
W. P. Carey School of Business at Arizona State University

PO Box 874011 | Tempe, AZ 85287-4011 | P (480) 965-3961 | F (480) 965-5458 | wpcarey.asu.edu/seid