If you are looking to conduct a shift share analysis to understand your industry’s competitiveness and identify growth opportunities, you’ve come to the right place. Shift share analysis is a valuable tool for businesses and policymakers to compare the performance of a specific industry in a local market with that of the overall economy.
By using a shift share analysis calculator, you can easily estimate the contributions of various factors to an industry’s growth or decline.
To help you maximize the benefits of shift share analysis, we have compiled five actionable tips that will guide you through the process and help you make more informed decisions.
Whether you are a business owner, an analyst, or a policymaker, these tips will help you unlock insights that can drive strategic planning and policy development.
1. Understand the Basics of Shift Share Analysis
Before diving into using a shift-share analysis calculator, it is essential to understand the fundamentals of this analytical tool.
At its core, shift share analysis decomposes the overall growth of an industry into three components: national growth, regional growth, and shift share.
National growth represents the growth of the industry at the national level, regional growth signifies the growth of the industry in the specific region of interest, and shift share measures the differential growth between the industry in the region and at the national level.
Example
For example, let’s say you are analyzing the employment growth in the manufacturing industry in a particular state.
By using a shift share analysis calculator, you can determine whether the state’s manufacturing sector is outperforming or underperforming compared to the national average.
Understanding these components will help you interpret the results of your analysis more effectively.
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