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Location quotient by industry

In 2018/19, Agriculture, Forestry and Fishing was a major specialisation in the City of Albany 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 Albany - Employment (Total)2018/192013/14Change
Industry (Click rows to view sub-categories)%. Western Australia%Location Quotient Western Australia%. Western Australia%Location Quotien Western Australia2018/19 - 2013/14
Agriculture, Forestry and Fishing8.92.63.426.72.42.75+0.24
Mining0.27.10.030.47.30.05-0.35
Manufacturing3.96.70.595.07.10.71-0.17
Electricity, Gas, Water and Waste Services1.51.51.001.71.51.19-0.16
Construction10.19.51.066.310.50.60+0.78
Wholesale Trade2.43.00.782.83.20.87-0.11
Retail Trade13.110.21.2914.19.71.45-0.11
Accommodation and Food Services6.86.41.077.26.11.18-0.09
Transport, Postal and Warehousing4.14.80.874.15.00.82+0.06
Information Media and Telecommunications1.21.11.151.21.20.95+0.21
Financial and Insurance Services1.42.40.581.72.50.68-0.15
Rental, Hiring and Real Estate Services1.41.60.851.81.90.98-0.13
Professional, Scientific and Technical Services4.07.30.554.27.20.58-0.06
Administrative and Support Services2.73.20.863.53.31.08-0.21
Public Administration and Safety6.76.61.006.86.11.11-0.10
Education and Training10.89.11.1810.48.51.23-0.04
Health Care and Social Assistance14.311.21.2815.310.81.42-0.10
Arts and Recreation Services1.81.71.041.81.61.11-0.06
Other Services4.74.01.154.84.11.18-0.02
Total Industries1001001.00100100+1.000

Source: National Institute of Economic and Industry Research (NIEIR) ©2019. Compiled and presented in economy.id by .id the population experts. 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 Albany in 2018/19 shows the three industries with the highest location quotient relative to Western Australia were:

  • Agriculture, Forestry and Fishing (3.4 )
  • Retail Trade (1.3 )
  • Health Care and Social Assistance (1.3 )

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

  • Financial and Insurance Services (0.6 )
  • Professional, Scientific and Technical Services (0.5 )
  • Mining (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 2013/14 and 2018/19 in the City of Albany were for these industries:

  • Construction (+0.8)
  • Mining (-0.4)
  • Agriculture, Forestry and Fishing (+0.2)
  • Information Media and Telecommunications (+0.2)

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