LQs

1. Regional Data
Location Quotients

2. Regional Data
• We have hotels, do we have “a lot”?
– Raleigh has hotels too?
• Need context!
• 𝑳𝒐𝒄𝒂𝒕𝒊𝒐𝒏 𝑸𝒖𝒐𝒕𝒊𝒆𝒏𝒕 =
𝑳𝒐𝒄𝒂𝒍 𝑬𝒎𝒑 𝒊𝒏 𝑰𝒏𝒅
𝑻𝒐𝒕𝒂𝒍 𝑳𝒐𝒄𝒂𝒍 𝑬𝒎𝒑
𝑵𝒂𝒕𝒊𝒐𝒏𝒂𝒍 𝑬𝒎𝒑 𝒊𝒏 𝑰𝒏𝒅
𝑻𝒐𝒕𝒂𝒍 𝑵𝒂𝒕𝒊𝒐𝒏𝒂𝒍 𝑬𝒎𝒑
• LQ > 1  More than national average
• LQ < 1  Less than national average

3. LQs and Wage data
Industry (emp)
Avg
Annual
Wage
(NHC
2018)
Leis & Hosp (18027) 17836
Construction (7798) 50,791
Information (3159) 70,161
Trade, Trans, Util (22196) 37,275
Prof & Bus Serv (15235) 55,556
Finance (5449) 67,165
Educ & Health (13857) 45,729
Manufacturing (5104) 78,157
Nat Res. & Min. (152) 41,014
0
0.2
0.4
0.6
0.8
1
1.2
1.4
1.6
1.8
Industry Location Quotients
Wilmington Region
2010 2018

4. Cautions
• Is the LQ different from 1?
– Often difficult to tell
– Imprecise at local level
• Do not consider size of firms
– One large firm doesn’t indicate a
“cluster”
• Often too aggregated
– i.e. types of manufacturing

5. Diagram Here…
Identifying Important
Industries
(see notes from class)