Volume 3 Issue 1 

QWI UPDATE 

January 2004 

INSIDE THIS 

ISSUE: 

QWI UPDATE 1 

FEBRUARY TRAINING 1 

STATE WORKSHOP 2 

OTHER DELIVERABLES 2 

LOW WAGE WORK BOOK 3 

SLOAN FOUNDATION GRANT 3 

REPORTS ON THE AGING

WORKFORCE

4 

GIS WORK 5 

LEHD/LED? 6 

WEB SITE UPDATE 6 

PRODUCTION REMINDERS 8 

CONFIDENTIALITY RESEARCH 7 

TEAM NEWS 8 

LED N EWSLETTER EWSLETTER EWSLETTER

F EBRUARY TRAINING

T he LMI Training Institute sponsored a very successful training session 

in June, 2003. A second session will be offered February 22-24, 2004 

in Washington DC, focusing on 

understanding and applying the QWI 

data to create useful labor market information. There will also be presentations 

on the disclosure proofing system, the 

weighting approach and the multiple 

imputation methodology. Full use will 

be made of the remote access at the Cornell Restricted Access site. 

T he LED program moved into full production in the second part of 

2003-moving from a research and development operation to a full 

fledged production operation. We produced and distributed V3.1 of 

the Quarterly Workforce Indicators for 21 partner states in December under 

the direction of our new production manager, Greg Weyland. We hope to be 

producing indicators for all 27 partners (and more!) by the end of 2004. The 

next production run will include indicators by detailed industry within counties, metro areas and WIAs. 

As a reminder, we ask that all state partners send 

their updated wage record and ES202 files at the beginning of every quarter. States are asked to send 

files that go back to the last quarter of data that is 

currently at LED, with one quarter overlap (to permit 

updates). Our protocol that permits states to transmit 

files via FTP as well as CD’s is now available—

please contact Greg for the information on this. 

The listserv for QWI questions has been quite active. To subscribe, go to 

http://lists.census.gov/mailman/listinfo/led-qwi - a username and password 

will be required. 
LED Newsletter 

O ur annual state workshop is scheduled for February 26 and 27 at the 

Grand Hyatt in Washington DC. The aims of the workshop are: 

1 To report on and consolidate last year’s progress 

2 To discuss and decide on priorities for next year 

3 To expand awareness of the LEHD partnership to federal agencies and national representatives of state organizations. 

In order to achieve these aims, the workshop has two parts. The first part, the 

business meeting, provides the basis for the policy and the technical direction 

for the upcoming year. We discuss both marketing and outreach as well as 

such technical matters as what new indicators should be developed in 2004. 

The state partners will also formalize the federal/state partnership and elect a 

committee to provide year-round input into the program. 

The second part will be more 

customer oriented. We will 

first showcase the proposed 

new GIS approach to delivering LED data. LED state partners will then showcase how 

they have used the QWI’s to 

provide information to WIB’s and economic developers, as well as how they 

can be used for strategic planning. 

We hope that the workshop will facilitate the sharing of new information and 

new ideas on how to fully exploit these new data. To this end, we’ve invited a 

number of representatives from federal agencies—such as HHS, BTS, ETA 

and BLS—and from national organizations—such as NASWA, NAWB and 

NGA—to give feedback and advice.

S uccessor/Predecessor Files: These files were shipped to partner states 

in mid-July and another shipment will be sent out this month. We hope 

they help in data processing, and we would also like feedback from partner states about ways to improve the links. 

Edited Wage Records: This process was slowed as a result of the intense focus 

on moving to full production in a timely fashion. We expect all historical records 

to be processed in the current production round. However, future rounds will 

overlap with previous returns by at most 4 quarters, plus any new data of whatever duration (1-4 quarters). Because of the sizable computer resources needed to 

do the wage record editing, we will implement a rotating schedule for the processing of each state’s data—the details on this will follow as we determine the 

size of the files and computer constraints. 

Page 2 

STATE WORKSHOP

OTHER DELIVERABLES

We hope that 

the workshop 

will facilitate 

the sharing of 

new 

information 

and new 

ideas on how 

to fully 

exploit these 

new data.
LED Newsletter 

A first draft of the low-wage work book was finished in December. Entitled Moving Up or Moving on: Workers, Firms and 

Advancement in the Low-Wage Labor Market, it represents the result of the Russell Sage/Rockefeller Foundations/ETA/HHS sponsored lowwage work project that began over two years ago. It represents the first major 

use of multi-state wage records combined with demographic data in the analysis of the low-wage labor market, and there are a number of very interesting 

findings. 

• Many prime-age workers who have been low earners for at least three years 

move out of low wage status in the next three years. 

• The employer matters: Transitions out of low earnings are associated with 

subsequent employment in high-wage industrial sectors, larger firms, those 

with lower turnover, and especially in high-wage firms. 

• Transitions out of low earnings occur much more frequently among those 

changing jobs than those staying in jobs. 

• Working for a “temp” agency can be a plus: Early work experience at a 

“temp” agency is associated with higher subsequent earnings. 

• There are enormous differences across employers, even within narrowly 

defined industries in the hiring and advancement of low earners. Such 

firms can be identified on the basis of past performance. 

• Geography matters: Low earners live further away from good job opportunities than non-low earners, and their commuting behavior is more limited. 

A policy brief based on parts of the book was released by the Brookings Institution and is at http://www.brookings.edu/es/urban/publications/200310_holzer.htm.

T he Sloan project has just finished its first year. The first draft of the book 

entitled Firms, Workforce Quality, and Economic Growth: New 

Data, New Approaches, and New Evidence is expected to be finished 

by March 2004. The Sloan Centers and LEHD staff presented their preliminary 

results on earnings inequality, career ladders and firm performance—the core 

chapters in the book—at the Allied Social Sciences Assocations meetings in San 

Diego in January, and received very positive feedback. Some highlights so far 

include: 

Wage inequality: Human capital levels and firm pay setting practices levels are 

important contributors to levels of earnings inequality but human capital changes 

and firm pay setting practices changes are not primary contributors to changes in 

earnings inequality. 

Career ladders: The evidence suggests there are substantial returns to firmspecific job tenure but the most rapid wage gains observed in the labor market 

are for those who have changed jobs. 

Firm performance: Even after controlling for firm productivity, firms with a larger fraction of workers with high human capital and lower excess worker turnover are much more likely to survive.

Page 3 

LOW WAGE WORK BOOK

SLOAN FOUNDATION GRANT

A first draft of 

the low-wage 

work book was 

finished in 

December. 
LED Newsletter 

A cross the country, firms are beginning to plan for the large wave of workers born during the Baby Boom of 1946 to 1964 leaving the workforce 

over the next few decades. It is possible that a larger share than in past 

generations will “retire” to collect the pensions they earned over their work life 

and then continue working part time or in more flexible working arrangements. 

Decision-makers need to know which industries and regions of the state will be 

most affected by changes in the size and composition of the labor force in coming 

decades. Businesses need to make more informed plans for the transitions they 

face and to pinpoint both potential problem areas and new opportunities. Older 

workers who want to continue working need to know in what industries and in 

what areas jobs are available, how flexible businesses are about their working arrangements, and the level of earnings they can expect. The LED program data are 

ideally suited to answer these questions. The Census Bureau has teamed up with a 

number of partner states to develop a jointly distributed product customized for 

each state that can be disseminated through state and Census Bureau channels. 

These reports answer such key questions as: 

• What is the age composition of the workforce and what are the changes? 

• Which industries are most affected by the aging of the workforce? 

• How stable are the jobs of older workers? 

• In which industries are older workers most likely to be employed? 

• How much do older workers earn? 

This project is sponsored by the National Institute on Aging—other customized 

reports on low-wage workers, specific industries and immigrants will be forthcoming in the next year. 

Page 4 

R EPORTS O N THE AGING WORKFORCE

The Census 

Bureau is 

teaming up 

with a number 

of states to 

develop a 

jointly 

distributed 

product. 

Other 

customized 

reports on 

low-wage 

workers, 

specific 

industries 

and 

immigrants 

will be 

forthcoming 

in the next 

year.

0

1

2

3

4

5

6

7

8

%

o

f

w

o

r

k

e

r

s

6

5

+

y

e

a

r

s

Bus. Ser.Health Ser

Memb. OrgReal Est.Soc. Ser.

Misc. Retail

Car DealersWholesale Trade

Const (special trade)

Whl. Trd. UDur(

HotelsGen. Merch. Stores

What industries employ the oldest workers?

Source: U.S. Census Bureau and Oregon Department of Employment 
LED Newsletter 

A n important component of the LED Program data is the ability to describe the geographic interaction between workers and firms. Because 

the data have information on both the place of work and place of residence of workers – and how these change over time – the value of the data infrastructure for researchers in transportation, economic development and regional planning is unsurpassed. Indeed, initial research in cooperation with the 

states of Florida, Illinois and Minnesota and the Bureau of Transportation Statistics have enabled the production of a variety of releasable statistics: block 

level origin to destination flows of employee numbers from household to place 

of employment; information on the characteristics of workers by block residence (the number of workers living on each block; the proportion of workers 

earning low, medium, or high annual wages and mean annual wages) and information on the characteristics of businesses by block (mean monthly pay per 

worker and the industry classification of firms operating on each block). 

John Carpenter, from Excensus in Minneapolis, is working with the LED program to use the basic block-level data and develop a GIS system. One example 

of what he will be producing is provided in Figure 2: it shows where workers 

at the Mall of America in Minneapolis live—and whether they are served by 

the new light rail line that is being constructed. Our aim is to create a webbased interface that permits workers to find out where firms are located; and 

firms to find out where potential workers might be. 

Page 5 

GIS WORK

The LED 

program has 

produced 

disclosureproofed block 

level origindestination 

matrices, as 

well as the 

characteristics 

of workers 

and employers 

on each block 

for Florida, 

Illinois and 

Minnesota.
LED Newsletter 

W e’ve had a number of people ask us whether the name of the program is LEHD or LED. The program itself is the LEHD 

(Longitudinal Employer-Household Dynamics) program—and that 

is how it is referred to internally at the Census Bureau and by other federal 

agencies. However, that name is a bit difficult to say—and so we use Local 

Employment Dynamics (LED) for products related to the QWI’s. 

Page 6 

WEBSITE UPDATE

LEHD/LED?

Users of QWI 

data can now 

query local 

labor market 

information 

using this new 

interactive 

feature

T he Quarterly Workforce Indicators are available on-line. The LED 

website has been market tested and will be moved onto the Census Bureau’s website this month. Users of QWI data can now query local labor market information using this new interactive feature. Partner states can 

use data tools available on the new site to download key indicators, obtain information about data and other state products, and obtain research reports on 

ongoing LED research. 

One of the most interesting uses of the data for 

customers is finding out 

what the top industries 

are for different age 

groups and what the 

earnings are for these 

industries. In many 

states, the top ten employers for each age 

group are very different—for example, national commercial banks 

are not in the top ten employers for all age 

groups, but they are for 

35-44 year old women! 

And the picture for hires 

is very different from the 

picture for employment—again as can be 

seen in the table for New 

Mexico, the top ten hiring industries do not include either national 

banks or commercial 

physical/biological research! 

What are top ten industries in NM 

for 35-44 year old women?

Comm. Phys/Bio 1,147 General Hospitals 138

Research

Legal Services 1,074 Residential Care 125

Natl. Comm. Banks 1,192 Home Health Care 145

Ind/Fam Soc. Ser 1,789 Ind/Fam Soc. Ser 191

Hotels/Motels 2,164 Help Supply 201

Grocery Stores 2,591 Grocery Stores 209

Doctors’ Offices 2,635 Hotels/Motels 250

Dept. Stores 3,037 Doctors’ Offices 253

General Hospitals 3,270 Dept. Stores 300

Eating/Drinking 4,609 Eating/Drinking 606

Industry Employment Industry Hires

Comm. Phys/Bio 1,147 General Hospitals 138

Research

Legal Services 1,074 Residential Care 125

Natl. Comm. Banks 1,192 Home Health Care 145

Ind/Fam Soc. Ser 1,789 Ind/Fam Soc. Ser 191

Hotels/Motels 2,164 Help Supply 201

Grocery Stores 2,591 Grocery Stores 209

Doctors’ Offices 2,635 Hotels/Motels 250

Dept. Stores 3,037 Doctors’ Offices 253

General Hospitals 3,270 Dept. Stores 300

Eating/Drinking 4,609 Eating/Drinking 606

Industry Employment Industry Hires

What are top ten industries in NM?

Ind/Fam Soc. Ser. 9,065 Gen. Bus. Ser 910

Help Supply 9,012 General Contractors 886

Semiconductors 9,224 Farm Labor 965

Doctors’ Offices 12,184 Ind/Fam Soc. Ser. 1020

Commercial 13,096 Doctors’ Offices 1079

Physical/Bio Research

Hotels/Motels 14,292 Help Supply 1760

General Hospitals 14,436 Grocery Stores 1766

Grocery Stores 16,576 Hotels/Motels 1935

Department Stores 20,934 Department Stores 1935

Eating/Drinking 48,879 Eating/Drinking 7841

Industry Employment Industry Hires

Ind/Fam Soc. Ser. 9,065 Gen. Bus. Ser 910

Help Supply 9,012 General Contractors 886

Semiconductors 9,224 Farm Labor 965

Doctors’ Offices 12,184 Ind/Fam Soc. Ser. 1020

Commercial 13,096 Doctors’ Offices 1079

Physical/Bio Research

Hotels/Motels 14,292 Help Supply 1760

General Hospitals 14,436 Grocery Stores 1766

Grocery Stores 16,576 Hotels/Motels 1935

Department Stores 20,934 Department Stores 1935

Eating/Drinking 48,879 Eating/Drinking 7841

Industry Employment Industry Hires

Source: US Census Bureau and New Mexico Department of Labor 
LED Newsletter 

A s you know LEHD developed a new confidentiality protection system 

for the QWI’s in order to permit the release of very detailed geography 

and industry classifications in those indicators. In addition, the system 

used on the QWI’s will permit the release of NAICS-based indicators on both a 

current and historical basis very soon. All of this was accomplished without compromising the confidentiality of the underlying UI wage records, ES-202 data, 

and Census Bureau Title 13 data. 

Now we've turned our attention to the problem of confidentiality protecting the 

micro-data themselves for research use outside of the Census Bureau. Our microdata protection system is based on the idea of inference-valid synthetic data, 

which is a concept that’s been around the statistics literature for about a decade. 

Synthetic data are a method of releasing micro-data that have been simulated in a 

manner that reliably reproduces many of the complex relations in the original 

confidential micro-data without actually releasing any of those data. Producing 

inference-valid synthetic data is a computationally intensive process but using 

these data is straightforward--they look just like the original confidential data and 

can be analyzed with the same programs. 

The LEHD Program at Census is the first major statistical project to develop a 

workable synthetic data system. Our prototype project is a public use file based 

on the Census Bureau's Survey of Income and Program Participation, the Social 

Security Administration's Master Benefit Record (and other benefit data), and 

other administrative records. The prototype has been under development for 

more than two years. In December, LEHD released the first draft (still confidential) for testing by SSA and the Congressional Budget Office. Refinements and 

additional drafts will be produced over the next six months. We hope that the 

public use file will be released in July. 

At the same time LEHD was developing the application for the SIPP-SSA public 

use file, we were experimenting with 

synthetic data for the underlying microdata in the QWI system. Certain technical challenges slowed our attempts to 

synthesize the core files that form the 

basis of the QWI. Most of these difficulties have been addressed by the second-generation synthesizing software 

we developed for the SIPP-SSA project. Once the Census Disclosure Review Board approves the synthesizing 

for the QWI micro-data, we're planning 

a major upgrade to the Cornell Restricted Access Data Center Simulator machine so that authorized users will be 

able develop applications directly on the synthetic QWI data. 

Page 7 

CONFIDENTIALITY RESEARCH

All of this was 

accomplished 

without 

compromising 

the 

confidentiality 

of the 

underlying UI 

wage records, 

ES-202 data, 

and Census 

Title 13 data.
LED Newsletter Page 8 

TEAM NEWS

PRODUCTION REMINDERS

W e welcome our new production manager Greg Weyland who will 

be taking over the management of our new production system. 

Greg worked on getting the Current Population Survey data out 

every month, so he has lots of experience in meeting deadlines! 

Beth Long, Anja Decressin and Martha Stinson all delivered healthy baby 

boys in October. 

John Abowd and Lars Vilhuber’s paper describing the LEHD wage record editing procedure has not only been accepted by the Journal of Business and Economic Statistics, but is the JBES invited paper in the 2004 American Statistical 

Association meetings. 

Participants in the Sloan project had a very productive workshop in October, 

and presented four papers at the Allied Social Science Association meetings in 

San Diego in January. 

A paper by Harry Holzer, Julia Lane and Lars Vilhuber on low-wage work is 

forthcoming in the Industrial and Labor Relations Review. 

We welcome Romain Aeberhardt from the French national statistical institute, 

INSEE, to LEHD to work with us for one year. 

L ED just completed its first set of production processing of QWI’s during the fourth quarter of 2003. All states that supplied 2003 first quarter data by the middle of the quarter had their QWI’s shipped by December 31. 

For current quarter processing, containing data through 2003 second quarter, 

we will adhere to the same schedule and deliver data on a flow basis throughout the quarter. Our experience during the last quarter suggests that, particularly for smaller states, the processing will be quicker than originally estimated . We will process the data in the same order in which it is received. 

We have two major enhancements planned for this round of processing. First 

we will switch over to the NAICS industry codes. Please remember that we 

will need to receive a copy of your LDB file that you recently received from 

BLS in order for this conversion to occur. Greg’s recent e-mail to the state 

technical contacts outlined this process. Let him know if you need any background information on this (301 763-3790 or gregory.d.weyland@census.gov). 

Second, we plan to provide detailed industry estimates (detailed NAICS codes) 

for substate geography with the newest set of QWI’s. The same e-mail mentioned above provides details of the changeover and also discusses various delivery options for these greatly expanded set of QWI’s. Feel free to contact 

Greg if you have any questions of comments about the new production processes.

We have two 

major 

enhancements 

...we will 

switch over to 

NAICS 

industry 

codes ...we 

will provide 

detailed 

industry 

estimates for 

substate 

geography