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Technical Note
Scope of the survey
The Occupational Employment Statistics (OES) survey is a semiannual
mail survey measuring occupational employment and wage rates for wage
and salary workers in nonfarm establishments in the United States.
Guam, Puerto Rico, and the Virgin Islands also are surveyed, but their
data are not included in this release. OES estimates are constructed
from a sample of about 1.2 million establishments. Forms are mailed to
approximately 200,000 establishments in May and November of each year
for a 3-year period. The nationwide response rate for the May 2008
estimates is 78.2 percent based on establishments and 74.3 percent based
on employment. The survey included establishments sampled in the May
2008, November 2007, May 2007, November 2006, May 2006, and November
2005 semiannual panels.
The occupational coding system
The OES survey uses the Office of Management and Budget's (OMB) occu-
pational classification system, the Standard Occupational Classification
(SOC) system. The SOC system is the first OMB-required occupational
classification system for federal agencies. The OES survey categorizes
workers into 801 detailed occupations. Together, these detailed occupa-
tions make up 22 of the 23 major occupational groups. Military specific
occupations are not included in the OES survey. The major groups are as
follows:
Management occupations
Business and financial operations occupations
Computer and mathematical science occupations
Architecture and engineering occupations
Life, physical, and social science occupations
Community and social services occupations
Legal occupations
Education, training, and library occupations
Arts, design, entertainment, sports, and media occupations
Healthcare practitioner and technical occupations
Healthcare support occupations
Protective service occupations
Food preparation and serving related occupations
Building and grounds cleaning and maintenance occupations
Personal care and service occupations
Sales and related occupations
Office and administrative support occupations
Farming, fishing, and forestry occupations
Construction and extraction occupations
Installation, maintenance, and repair occupations
Production occupations
Transportation and material moving occupations
Military specific occupations (not surveyed in OES)
For more information about the SOC system, please see the Bureau of
Labor Statistics (BLS) Web site at http://www.bls.gov/soc/.
The industry coding system
The OES survey uses the North American Industry Classification System
(NAICS). The May 2008 estimates and survey data are based on the 2007
NAICS. Earlier panel data and estimates were based on the 2002 NAICS.
For more information about NAICS, see the BLS Web site at http://www.bls.
gov/bls/naics.htm.
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The OES survey includes establishments in NAICS sectors 11 (logging
and agricultural support activities only), 21, 22, 23, 31-33, 42, 44-45,
48-49, 51, 52, 53, 54, 55, 56, 61, 62, 71, 72, 81 (except private house-
holds), state government, and local government. The U.S. Postal Service
and the executive branch of the federal government also are included. An
establishment is defined as an economic unit that processes goods or pro-
vides services, such as a factory, mine, or store. The establishment is
generally at a single physical location and is engaged primarily in one
type of economic activity.
The OES survey covers all full- and part-time wage and salary workers
in nonfarm industries. The survey does not include the self-employed,
owners and partners in unincorporated firms, household workers, or unpaid
family workers.
Survey sample
BLS funds the survey and provides the procedures and technical support,
while the State Workforce Agencies (SWAs) collect most of the data. BLS
produces cross-industry and industry-specific estimates for the nation,
states, metropolitan statistical areas (MSAs), metropolitan divisions,
and nonmetropolitan areas. Industry-specific estimates are produced at
the NAICS sector, 3-digit, 4-digit, and selected 5-digit industry levels.
BLS releases all cross-industry and national estimates; many SWAs release
industry-specific estimates at the state and MSA levels.
State unemployment insurance (UI) files provide the universe from
which the OES survey draws its sample. Employment benchmarks are ob-
tained from reports submitted by employers to the UI program. Supple-
mental sources are used for rail transportation (NAICS 4821) and Guam
because they do not report to the UI program. The OES survey sample is
stratified by metropolitan and nonmetropolitan areas and industry. The
2000 Metropolitan Statistical Area standards were used to define the
metropolitan areas.
An annual census is taken of the executive branch of the federal
government, the U.S. Postal Service, state government, and Hawaii's
local government. In order to provide the most occupational coverage,
larger employers are more likely to be selected than smaller employers.
The unweighted employment of sampled establishments makes up approxi-
mately 61 percent of total national employment.
Concepts
Occupational employment is the estimate of total wage and salary em-
ployment in an occupation across the industries surveyed. The OES sur-
vey defines employment as the number of workers who can be classified
as full- or part-time employees, including workers on paid vacations or
other types of paid leave; workers on unpaid short-term absences; salaried
officers, executives, and staff members of incorporated firms; employees
temporarily assigned to other units; and employees for whom the reporting
unit is their permanent duty station regardless of whether that unit pre-
pares their paycheck.
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The OES survey forms sent to larger establishments, generally those
with 20 or more workers, contain between 50 and 225 SOC occupations
selected on the basis of the sampled establishment's industry classifi-
cation. To reduce paperwork and respondent burden, no survey form con-
tains every SOC occupation. Thus, data for specific occupations are
collected primarily from establishments in industries that are the pre-
dominant employers of workers in those occupations. Each survey form
is structured, however, to allow a respondent to provide detailed occu-
pational information for each worker at the establishment; that is, un-
listed occupations can be added to the survey form. Smaller establish-
ments, generally those with fewer than 20 workers, are sent a form with
no occupations listed, and are instructed to fill in the occupations for
their workers.
Wages for the OES survey are straight-time, gross pay, exclusive of
premium pay. Base rate, cost-of-living allowances, guaranteed pay,
hazardous-duty pay, incentive pay including commissions and production
bonuses, tips, and on-call pay are included. Excluded are back pay,
jury duty pay, overtime pay, severance pay, shift differentials, non-
production bonuses, employer cost for supplementary benefits, and tuition
reimbursements.
The OES survey collects wage data in 12 intervals. Employers report
the number of employees in an occupation for each wage range. The wage
intervals used for the May 2008 survey are as follows:
May 2008 wage intervals
--------------------------------------------------------
|
| Wages
Interval |-------------------------------------------
| Hourly | Annual
------------|-------------------|-----------------------
Range A | Under $7.50 | Under $15,600
Range B | $7.50 to $9.49 | $15,600 to $19,759
Range C | $9.50 to $11.99 | $19,760 to $24,959
Range D | $12.00 to $15.24 | $24,960 to $31,719
Range E | $15.25 to $19.24 | $31,720 to $40,039
Range F | $19.25 to $24.49 | $40,040 to $50,959
Range G | $24.50 to $30.99 | $50,960 to $64,479
Range H | $31.00 to $39.24 | $64,480 to $81,639
Range I | $39.25 to $49.74 | $81,640 to $103,479
Range J | $49.75 to $63.24 | $103,480 to $131,559
Range K | $63.25 to $79.99 | $131,560 to $166,399
Range L | $80.00 and over | $166,400 and over
--------------------------------------------------------
Mean hourly wage. The mean hourly wage rate for an occupation is the
total wages that all workers in the occupation earn in an hour divided
by the total employment of the occupation. To calculate the mean hourly
wage of each occupation, total weighted hourly wages are summed across
all intervals and divided by the occupation's weighted survey employment.
The mean wage for each interval is based on occupational wage data col-
lected by the BLS Office of Compensation and Working Conditions for the
National Compensation Survey (NCS). With the exception of the highest
wage interval, mean wage rates for each panel are calculated using NCS
data for the panel's reference year.
The lower boundary of the highest wage interval was $80.00. The mean
hourly wage for this interval was calculated using the average of the
2005, 2006, and 2007 NCS data.
Percentile wage. The p-th percentile wage rate for an occupation
is the wage where p percent of all workers earn that amount or less and
where (100-p) percent of all workers earn that amount or more. This
statistic is calculated by uniformly distributing the workers inside
each wage interval, ranking the workers from lowest paid to highest
paid, and calculating the product of the total employment for the oc-
cupation and the desired percentile to determine the worker that earns
the p-th percentile wage rate.
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Annual wage. Many employees are paid at an hourly rate by their
employers and may work more than or less than 40 hours per week. Annual
wage estimates for most occupations in this release are calculated by
multiplying the mean hourly wage by a "year-round, full-time" figure of
2,080 hours (52 weeks by 40 hours). Thus, annual wage estimates may not
represent the actual annual pay received by the employee if they work
more or less than 2,080 hours per year. Some workers typically work
less than 40 hours per week, year round. For these occupations, the OES
survey collects and reports either the annual salary or the hourly wage
rate, depending on how the occupation is typically paid, but not both.
For example, teachers, flight attendants, and pilots may be paid an
annual salary, but do not work the usual 2,080 hours per year. In this
case, an annual salary is reported. Other workers, such as entertainment
workers, are paid hourly rates, but generally do not work 40 hours per
week, year round. For these workers, only an hourly wage is reported.
Hourly versus annual wage reporting. For each occupation, respondents
are asked to report the number of employees paid within specific wage in-
tervals. The intervals are defined both as hourly rates and the corre-
sponding annual rates, where the annual rate for an occupation is calculated
by multiplying the hourly wage rate by a typical work year of 2,080 hours.
The responding establishment can reference either the hourly or the annual
rate for full-time workers, but they are instructed to report the hourly
rate for part-time workers.
Estimation methodology
With the exception of the May 2008 panel, each OES panel includes
approximately 200,000 establishments. Due to budget constraints, the
May 2008 sample was reduced to approximately 174,000 establishments. The
OES survey is designed to produce estimates using six panels (3 years)
of data. The full six-panel sample of nearly 1.2 million establishments
allows the production of estimates at detailed levels of geography,
industry, and occupation.
Wage updating. Significant reductions in sampling errors are obtained
by combining six panels of data, particularly for small geographic areas
and occupations. Wages for the current panel need no adjustment. However,
wages in the five previous panels need to be updated to the current panel's
reference period.
The OES program uses the BLS Employment Cost Index (ECI) to adjust
survey data from prior panels before combining them with the current
panel's data. The wage updating procedure adjusts each detailed occu-
pation's wage rate, as measured in the earlier panel, according to the
average movement of its broader occupational division. The procedure
assumes that there are no major differences by geography, industry, or
detailed occupation within the occupational division. The wage rates
for the highest wage interval are not updated.
Imputation. About 20 percent of establishments do not respond for a
given panel. A "nearest neighbor" hot deck imputation procedure is used
to impute missing occupational employment totals. A variant of mean im-
putation is used to impute missing wage distributions. The variant of
mean imputation for wage distributions also is applied to establishments
that provide reports with occupational totals but partial or missing
wage data.
Weighting and benchmarking. The sample establishments in each panel
are weighted to represent all establishments that were part of the in-
scope frame from which the panel was selected. Based on the sampled
establishments, sampling weights are adjusted when six panels are com-
bined. Sampling weights are further adjusted by the ratio of employment
totals (the average of November 2007 and May 2008 employment) from the
BLS Quarterly Census of Employment and Wages to employment totals from
the OES survey.
May 2008 OES survey estimates. The May 2008 OES survey estimates are
based on all data collected from establishments in the May 2008, November
2007, May 2007, November 2006, May 2006, and November 2005 semiannual
samples.
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Reliability of the estimates. Estimates calculated from a sample
survey are subject to two types of error: sampling and nonsampling.
Sampling error occurs when estimates are calculated from a subset (that
is, a sample) of the population instead of the full population. When a
sample of the population is surveyed, there is a chance that the sample
estimate of the characteristic of interest may differ from the population
value of that characteristic. Differences between the sample estimate and
the population value will vary depending on the sample selected. This vari-
ability can be estimated by calculating the standard error (SE) of the sam-
ple estimate. If we were to repeat the sampling and estimation process
countless times using the same survey design, approximately 90 percent of
the intervals created by adding and subtracting 1.645 SEs from the sample
estimate would include the population value. These intervals are called
90-percent confidence intervals. The OES survey, however, usually uses
the relative standard error (RSE) of a sample estimate instead of its SE
to measure sampling error. RSE is defined as the SE of a sample estimate
divided by the sample estimate itself. This statistic provides the user
with a measure of the relative precision of the sample estimate. RSEs
are calculated for both occupational employment and mean wage rate esti-
mates. Occupational employment RSEs are calculated using a subsample,
random group replication technique called the jackknife. Mean wage rate
RSEs are calculated using a variance components model that accounts for
both the observed and unobserved components of the wage data. The vari-
ances of the unobserved components are estimated using wage data from the
BLS National Compensation Survey. In general, estimates based on many
establishments have lower RSEs than estimates based on few establishments.
If the distributional assumptions of the models are violated, the resulting
confidence intervals may not reflect the prescribed level of confidence.
Nonsampling error occurs for a variety of reasons, none of which are
directly connected to sampling. Examples of nonsampling error include:
nonresponse, data incorrectly reported by the respondent, errors in the
administrative data used to create the sampling frame, mistakes made in
entering collected data into the database, and mistakes made in editing
and processing the collected data. Every attempt is made to minimize
nonsampling error through survey methods such as data editing, imputa-
tion methods, and benchmarking of data to current employment totals.
