City of Adelaide

Location quotient by industry

In 2019/20, Financial and Insurance Services was a major specialisation in the City of Adelaide in terms of Employment (Total).

The location quotient is a simple way of seeing which are the main industries in an area, relative to the wider region. LQ shows the percentage of the local economy characteristic (eg. employment, value add) in a particular industry divided by the percentage of the wider area (region, state, nation) that this industry makes up.

  • Where LQ=1, that industry is exactly as prevalent as in the wider region.
  • A LQ greater than 1.2 indicates a significant specialisation of the industry in the local area – possibly a key economic strength. Higher numbers mean greater specialisations. Anything over 2 is a major specialisation.
  • A LQ between 0.8 and 1.2 means the industry is broadly similar in importance in the local area compared to the comparison region and could be seen as representative.
  • An LQ under 0.8 indicates an industry which is more important in the region than the local area, and may represent an economic weakness or opportunity for growth.

LQs should be analysed in combination with the proportional economic share that industry represents. For example, an industry with an LQ of 2 reveals a specialisation but if that industry only represents 3% of the local economy, it may not be significant. Compare with the figures on the Employment by industry (Total), Employment by industry (FTE), Value added pages for this context. National Economics (NIEIR) - Modelled series

Data source

National Economics (NIEIR) - Modelled series

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Location quotient
City of Adelaide - Employment (Total)2019/202014/15Change
Industry (Click rows to view sub-categories)%. South Australia%Location Quotient South Australia%. South Australia%Location Quotien South Australia2019/20 - 2014/15
Agriculture, Forestry and Fishing0.13.80.020.14.50.03-0.13
Mining1.41.60.861.61.70.99-0.14
Manufacturing1.09.50.111.09.20.11-0.06
Electricity, Gas, Water and Waste Services1.91.41.332.11.41.48-0.10
Construction4.38.40.513.97.90.50+0.02
Wholesale Trade1.43.20.441.43.10.45-0.01
Retail Trade4.910.20.485.210.80.48+0.00
Accommodation and Food Services7.06.31.116.96.51.07+0.04
Transport, Postal and Warehousing2.14.60.461.94.50.42+0.10
Information Media and Telecommunications4.61.72.724.11.52.74-0.01
Financial and Insurance Services7.92.72.938.22.82.92+0.00
Rental, Hiring and Real Estate Services1.61.31.201.71.31.23-0.02
Professional, Scientific and Technical Services14.66.52.2313.65.92.29-0.03
Administrative and Support Services3.73.80.963.43.50.98-0.02
Public Administration and Safety16.66.72.4617.37.02.47+0.00
Education and Training8.98.31.068.38.50.97+0.09
Health Care and Social Assistance14.014.50.9614.514.41.01-0.05
Arts and Recreation Services2.41.51.602.71.51.80-0.11
Other Services1.93.80.502.14.00.53-0.05
Total Industries1001001.00100100+1.000

Source: National Institute of Economic and Industry Research (NIEIR) ©2021. Compiled and presented in economy.id by .id (informed decisions). NIEIR-ID data are adjusted each year, using updated employment estimates. Each release may change previous years’ figures. Learn more

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Dominant groups

A location quotient of greater than 1.2 is generally considered a level of industry specialisation, while a LQ of 0.8 or less indicates an industry which doesn’t have a major presence in the area.

An analysis of employment (total) in the City of Adelaide in 2019/20 shows the three industries with the highest location quotient relative to South Australia were:

  • Financial and Insurance Services (2.9 )
  • Information Media and Telecommunications (2.7 )
  • Public Administration and Safety (2.5 )

The three industries with the lowest location quotient relative to South Australia were:

  • Wholesale Trade (0.4 )
  • Manufacturing (0.1 )
  • Agriculture, Forestry and Fishing (0.0 )

Emerging groups

Changes in location quotients over time reveal emerging or declining industry specialisations.

The largest changes in the employment (total) LQ between 2014/15 and 2019/20 in the City of Adelaide were for these industries:

  • Mining (-0.1)
  • Agriculture, Forestry and Fishing (-0.1)
  • Arts and Recreation Services (-0.1)
  • Electricity, Gas, Water and Waste Services (-0.1)

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