Skills-Based Industrial Targeting

The purpose of the analysis is to measure how closely Nebraska communities match the occupational and skills demands of postindustrial industries. Occupational similarity can be used by economic developers and policy officials in three ways. First, ranking the similarity scores within a region provides a form of industry targeting that indicates which industries are best suited to the occupational and skills base in the region. Second, similarity scores can be used in business location decisions to place firms near workers with certain skills sets. Third, similarity scores can be used to target employee recruitment efforts towards areas with the appropriate mix of skilled workers. The Labor Similarity Index (LSI) is used to measure the similarity between the occupational demand of an industry and the occupational supply in a region. The LSI is a Gini coefficient that compares occupational demand and supply distributions and then normalized the scores to the state average for easier interpretation. The LSI is calculated for over 30 industry groups and is presented spatially across 1,200 Nebraska communities.