The Business Employment Dynamics (BED) data series include gross job gains and gross job losses at the establishment level by major industry sector and for the 50 states, the District of Columbia, Puerto Rico, and the Virgin Islands, as well as gross job gains and gross job losses at the firm level by employer size class.
The change in the number of jobs over time is the net result of increases and decreases in employment that occur at all businesses in the economy. BED statistics track these changes in employment at private business units from the third month of one quarter to the third month of the next. Gross job gains are the sum of increases in employment from expansions at existing units and the addition of new jobs at opening units. Gross job losses are the result of contractions in employment at existing units and the loss of jobs at closing units. The difference between the number of gross jobs gained and the number of gross jobs lost is the net change in employment.
Private Sector Establishment-Level Gross Job Gains and Job Losses
Opening and expanding private sector business establishments gained 7.5 million jobs in the first quarter of 2007, a decrease of 300,000 from the previous quarter. Over this quarter, expanding establishments added 6.2 million jobs while opening establishments added 1.4 million jobs.
Gross job losses totaled 7.1 million, a decrease of 226,000 from theprevious quarter. During the quarter, contracting establishments lost 5.8 million jobs while closing establishments lost 1.3 million jobs.
The difference between the number of gross jobs gained and the number of gross jobs lost yielded a net change of 438,000 jobs in the private sector for first quarter 2007.
From December 2006 to March 2007, gross job gains represented 6.6 percent of private sector employment while gross job losses represented 6.2 percent of private sector employment. These gross job gain and loss statistics demonstrate that a sizable number of jobs appear and disappear in the relatively short time frame of one quarter.
Major Industry Sector Gross Job Gains and Gross Job Losses
Goods-producing. Expanding and opening establishments in the goods-producing sector accounted for 1,629,000 jobs gained, and contracting and closing establishments accounted for 1,682,000 jobs lost. The net loss of 53,000 jobs was the third consecutive quarter of net loss in this sector.
Construction. In construction, gross job gains from December 2006 to March 2007 increased to 850,000 and gross job losses fell to 816,000, resulting in a net gain of 34,000 jobs. This was the first net gain in this industry since the first quarter of 2006.
Manufacturing. Gross job gains in manufacturing decreased to a level of 500,000 jobs in the first quarter of 2007 and gross job losses fell to 579,000, resulting in a net loss of 79,000 jobs.
Service-providing. In the service-providing sector, gross job gains totaled 5,880,000 and gross job losses totaled 5,389,000 in the first quarter of 2007, resulting in a net gain of 491,000 jobs.
Retail trade. Gross job gains in retail trade inched up to 1,087,000 and gross job losses fell to 971,000, resulting in a net gain of 116,000 jobs. This was the second consecutive quarter that this sector had a net gain.
Leisure and hospitality. The leisure and hospitality sector gained 1,165,000 jobs and lost 1,096,000 jobs in the first quarter of 2007, for
a net gain of 69,000.
Number of Establishments Gaining and Losing Employment
Another way to look at the dynamics of business activities is to monitor the number and proportion of business units that are growing and declining. In the first quarter of 2007, the number of establishments gaining jobs exceeded the number of establishments losing jobs. Out of 6.9 million active private-sector establishments, a total of 1,935,000 establishments gained jobs from December 2006 to March 2007. Of these, 1,577,000 were expanding establishments and 358,000 were opening establishments. During the quarter, 1,545,000 establishments contracted and 355,000 establishments closed, resulting in 1,900,000 establishments losing jobs. Overall, the number of active private sector establishments increased by 3,000 during the first quarter. This change was the difference between the number of opening establishments and the number of closing establishments.
Firm-Level Gross Job Gains and Gross Job Losses by Size Class
From December 2006 to March 2007, firms with 1,000 or more employees accounted for the largest share of gross job gains (16.5 percent) and firms with 1 - 4 employees had the largest share of gross job losses (16.7 percent).
In the first quarter of 2007, firms with 500 or more employees represented 21.0 percent of gross job gains and 20.7 percent of gross job losses. From September 1992 through March 2007, firms with 500 or more employees, on average, have accounted for 35.5 percent of quarterly net employment growth.
Firms with 1 - 4 employees continued to have the largest shares of both job gains at opening firms and job losses at closing firms, with 60.4 and 60.6 percent respectively, in the first quarter of 2007.
Gross Job Gains and Losses by State
Over the quarter, Alaska had the highest rate of gross job gains (10.3 percent) and gross job losses (9.5 percent). Connecticut had the
lowest rate of gross job gains (5.3 percent) and Hawaii and the District of Columbia had the lowest rates of gross job losses (5.2 percent each). Gross job gains exceeded gross job losses in 39 states and the District of Columbia. In 11 states, Puerto Rico, and the Virgin Islands, gross job losses were greater than gross job gains resulting in net losses in total employment.
