2020 Labor Demand Occupations List: Methodology
The Labor Demand Occupations List (LDOL) for 2020 uses an updated methodology to determine which occupations are expected to have a “significant excess of demand over supply for adequately trained workers.” The 2020 LDOL will be in effect on July 1, 2020. Given New Jersey’s relatively small size, there is a single statewide list for all occupations.
The 2020 Labor Demand Occupations List was developed by New Jersey Department of Labor and Workforce Development, Office of Research and Information.
This methodology considers many factors, incorporating data from a variety of sources, to determine whether an occupation is in demand. These include:
- Total employment in the occupation (demand)
- Long-term projections of actual job growth (demand)
- Long-term projected employment growth rate (demand)
- Long-term projections of annual job openings (demand)
- Online job postings (demand)
- Unemployment insurance claimants (supply)
- Reported completers by Classification of Instructional Program (supply)
In order to be classified as “in demand,” an occupation must meet criteria related to total employment and projected demand. In addition, all occupations classified as management occupations (SOC 11-) or “All Other” occupations (SOC ending in 99) are excluded from this list.
An occupation must have a statewide employment level of at least 2,000 in order to be considered for the demand list. In 2018 there were 274 occupations meeting this threshold, or 35 percent of the 794 occupations in the state.
Short-term Historical Growth
An occupation must have experienced short-term historical growth greater than the statewide average of 3.7% from 2015 to 2018 in order to be considered for the demand list. In 2018 there were 270 occupations that met this threshold, or 34 percent of the 794 occupations in the state.
Strong Projected Growth Rate
Any occupation that is projected to add employment at a rate higher than the statewide average of 8.2 percent is considered for the demand list. In 2018, there were 301 occupations meeting this threshold, or 38 percent of the 794 occupations in the state.
Any occupation that meets all three of these thresholds is included on the demand list, simply based on its strong demand. In 2018, there were 83 occupations meeting all three of these thresholds, or 10% of the 794 occupations in the state.
Supply vs. Demand Analysis
In an attempt to identify those occupations where there is “significant excess of demand over supply for adequately trained workers,” the following steps were taken:
- Each of the seven variables listed above (5 measuring demand, 2 measuring supply) were indexed on a scale of 0 to 1 to the maximum value for each individual measure.
- In order to get a single value for both supply and demand, an average (between 0 and 1) was calculated based on the individual indexed values.
- Any occupation where the demand value was greater than the supply value by at least .05 is also to be considered as in demand.
There were a total of 109 occupations (14% of the 794 occupations in the state) that are considered to be in demand based on this new methodology. The combined employment of these occupations is 1,951,000 in 2018 (48 % of the total occupational employment in the state).
Additional Targeted Occupations
The Department of Labor and Workforce Development may during the course of the year add occupations to the list, based on an analysis of the workforce needs of key industries in the state or based on changing labor market conditions.
Local Labor Demand Occupations
While the labor demand occupation list is based on a comprehensive analysis of supply and demand factors on a statewide basis, local labor market conditions may differ from those determined for the state. Local Workforce Development Boards (WDB) can request that additional occupations be added to the labor demand list for their area only if they demonstrate that there is a “significant excess of demand over supply for adequately trained workers” in the surrounding labor market area.
Such requests must be made in writing by a local WDB and must include supporting documentation or data. Local WDBs should submit these requests to: The Center for Occupational Employment Information (COEI), P.O. Box 057, Trenton, New Jersey 08625.
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