What it does
Which industries is a region specialised in, and why did its jobs grow faster or slower than the country’s? Regional economists, planners and geography students answer these questions with three classic tools, and this page does all three from one table of jobs by industry:
- Location quotient (LQ): the industry’s share of regional jobs divided by its share of jobs in the reference area (usually the country or state). An LQ of 2 means the region has twice the usual share; below 1 means less than the usual share.
- Shift-share analysis: splits each industry’s change in jobs between two years into the national share (the change if it had grown at the reference area’s overall rate), the industry mix (extra growth or loss because that industry grew faster or slower than the whole economy) and the regional shift (what is left: the region doing better or worse than the same industry elsewhere). The three always add up to the actual change.
- Economic base: jobs above the reference share (where LQ > 1) are counted as basic, serving customers outside the region; the rest are non-basic. Total jobs divided by basic jobs is the economic base multiplier.
It also gives the coefficient of specialisation: half the sum of the differences in industry shares, from 0 (the same mix as the reference area) to 1 (nothing in common). Everything runs in your browser; nothing is uploaded.
It works well with the trend and anomaly analyser, the publication plot maker and the gravity model.
How to use it
- Paste a table with one row per industry. With two years, the columns are: industry, region year 1, region year 2, reference year 1, reference year 2. With one year, use industry, region, reference. A header row is optional; years in it (such as 2015) are used as labels.
- Or open a CSV, TSV or Excel file with Open a file.
- Choose which year the basic and non-basic jobs are worked out for (second year by default).
- Read the summary, the two charts and the table. Download the table as CSV, or the whole report as an image, PDF or Word file.
Formulas
For industry i with regional jobs e and reference jobs E, totals without a subscript:
- LQ = (ei / e) ÷ (Ei / E)
- National share = ei,0 × G, where G is the reference area’s total growth rate
- Industry mix = ei,0 × (gi − G), with gi the industry’s growth in the reference area
- Regional shift = ei,0 × (ri − gi), with ri the industry’s growth in the region
- Basic jobs = max(0, ei − e × Ei / E); multiplier = e ÷ total basic jobs
Worked example
The example is a made-up region of 34,950 jobs in 2015 and 39,200 in 2025, compared with a made-up country. Regional jobs grew by 4,250 (+12.2 %) while the country grew by 8.6 %. Shift-share splits the 4,250 into +3,002 national share, −768 industry mix (the region leans on manufacturing and farming, which shrank nationally) and +2,015 regional shift, most of it from tourism and hospitality (+822). Mining and quarrying has the highest LQ, 3.81 in 2025. The region has 4,706 basic jobs in 2025, so the economic base multiplier is 8.33, and the coefficient of specialisation is 0.12.
Tips
- Use the finest industry list you have, the same in every column. Coarse groups hide specialisation and make the LQ method undercount basic jobs.
- The reference area should be the larger economy the region trades within. Leaving the region inside the reference totals is usual and fine.
- A new industry (no jobs in year 1) has no growth rate, so all its jobs go to the regional shift.
- LQ basic jobs are a floor estimate: the method assumes the same spending pattern everywhere and that a region with LQ below 1 exports nothing. Treat the multiplier as a rough guide, not a forecast.
FAQ
What LQ counts as a specialisation? There is no fixed cut-off. Many studies treat LQ above 1.25 as a clear concentration, which the table marks in bold, but small industries can have large LQs from a handful of jobs.
Why do my shift-share numbers differ from another study? Some studies use a dynamic version (year by year), or the Esteban-Marquillas extension that splits the regional shift further. This page uses the classic two-year version.
Can I use earnings or output instead of jobs? Yes, any count or amount that adds up across industries works, as long as every column uses the same measure.
Is my data sent anywhere? No. The numbers stay in this page and are gone when you close it.
Where the numbers come from
- Formulas: location quotient and the economic base (LQ method) as in standard regional economics textbooks; classic shift-share decomposition (Dunn 1960).
- Example data: made up.
Standard scientific values, such as constants, atomic weights and melting points, are facts found in every textbook; we name where ours were checked. If you are an author or publisher and want a value, a credit or a table changed or removed, tell us and we will act quickly.
Last updated 2026-11-09.