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Occupational staffing patterns at the four-digit SIC level.

The Occupational Employment Statistics (OES) program has developed a technique for producing information on occupational employment at the four-digit Standard Industrial Classification (SIC) level of detail.(1) Previously, such statistics were available only at the more aggregate three-digit level. By estimating occupational staffing patterns at the more detailed level, users are able to focus on the staffing demands of specific types of establishments whose unique characteristics become obscured when viewed at more aggregate levels of industry grouping.

This research summary examines the occupational staffing pattern of establishments engaged in the radiotelephone industry (SIC 4812) and compares it with that of all telephone communications establishments (SIC 481). The comparison demonstrates the value of estimating occupational data by four-digit SIC industry by revealing staffing differences between establishments providing radiotelephone services and the amalgam of establishments found at the three-digit industry group level. Establishments classified in the radiotelephone component provide a variety of wireless communications activities, most notably, cellular telephone service. At the industry group level, establishments supplying radiotelephone services are combined with the much larger and more established traditional wire telephone sector, which includes providers of local and long-distance telephone service.

Scope of the survey

The OES survey is a Federal-State cooperative establishment survey of wage and salary workers designed to produce data on current occupational employment. Data from the survey are used to analyze occupational staffing patterns by estimating the ratio of employment in a particular occupation to total employment in a given industry. The survey is based on a probability sample stratified by geographic area, three-digit SIC industry, and size (that is, number of workers) of establishment. Presently, the OES program produces State and national occupational estimates at the two- and three-digit SIC level.(2) Although the survey was not designed to produce occupational estimates at the four-digit industry level, the number of units in the sample for the radiotelephone communications industry was sufficient to produce a limited number of occupational employment estimates.(3) The survey follows a 3-year cycle, and in the cycle ending in 1991, more than 700,000 different establishments were included in the sample.(4)

The sampling frame used by the OES survey consists primarily of the universe of establishments covered under each State's unemployment insurance program.(5) Establishments covered under these programs are required to report their monthly employment, wages, and industry designation, as defined by the SIC system.

Industry profile

Within the telephone communications industry (SIC 481), a distinction is made between establishments providing radiotelephone service (SIC 4812) and those providing wire telephone service (SIC 4813).(6) Firms in the radiotelephone component provide two-way radiotelephone communications, such as cellular telephone service. Also included are businesses providing beeper and paging services. The wire telephone component includes establishments that provide data telephone communications, local telephone service, and long-distance telephone service.

The radiotelephone component of the telephone communications industry group accounted for only 5 percent of total employment in the group in 1991. Because firms engaged in the radiotelephone sector employ far fewer workers than does the traditional wire telephone component, they contribute little to the occupational staffing pattern at the industry group (that is, the three-digit SIC) level. In spite of its small size relative to other industries, the radiotelephone sector is a rapidly growing industry component. More than 44,500 people worked in radiotelephone communications in 1991, up from just under 23,300 in 1988.

Occupational staffing patterns

The OES occupational classification system divides workers into seven major groups: managerial and administrative occupations; professional, paraprofessional, and technical occupations; sales and related occupations; clerical and administrative support occupations; service occupations; agriculture, forestry, fishing, and related occupations; and production, construction, operating, maintenance, and material-handling occupations. Within the telephone communications industry group, however, the workers in five of the major occupational groups--managerial, professional, sales, clerical, and production-- accounted for more than 99 percent of total employment in 1991. These groups, together with selected detailed occupations in each, are outlined in table 1, in terms of their relative proportions and numbers employed, at the industry group level and the component level.

Managerial and administrative occupations. These workers, who are responsible for policymaking, planning, staffing, directing, or controlling the activities of an establishment, made up 7.6 percent of all workers in telephone communications in 1991. By contrast, the radiotelephone segment had 12 percent of its workers employed as managers or administrators. This 4.4-percent difference can be attributed almost entirely to two occupations: marketing managers and general managers.

The radiotelephone component had 4 times as many marketing managers, as a percentage of all workers, than did the telephone group as a whole. Persons employed as marketing managers represented 3.5 percent of total radiotelephone employment, but less than 1 percent at the industry group level. Marketing managers are responsible for developing marketing strategies, sales activities, advertising, and public relations. The higher proportion of these workers in the radiotelephone component may be related to the greater likelihood there is for first-time customers in industries providing newer services (for example, cellular phones), compared with those furnishing more established services (for example, long-distance service). In any event, because the number of employees in the radiotelephone sector is so small relative to that in the wire telephone component, it had little impact in determining the proportions at the industry group level.

Similarly, general managers in the radiotelephone component accounted for 3.1 percent of employment, a figure that again was obscured at the telephone industry group level, which allocated 1.4 percent of employment to general managers. Also, 58.5 percent of all radiotelephone firms responding to the survey reported employing at least one general manager, the highest ratio of any occupation in this component. At the same time, only 43.1 percent of the combined industry group reported employing general managers, which suggests that a different organizational structure exists between firms providing the newer radiotelephone services and those in more established businesses. Without the availability of data for the radiotelephone segment of the telephone group, the fact that such firms employ managers in greater proportions would go unnoticed.

Professional, paraprofessional, and technical occupations. Workers in this occupational division include those employed in the theoretical or technical area of a field in which substantial postsecondary school training or equivalent on-the-job training is required. The telephone industry had a relatively small number of workers in these types of occupations, 11.8 percent in 1991; the radiotelephone group employed them at a comparable 13.7-percent level.

Almost all of the 1.9-percent difference between professional employees working in the radiotelephone sector and those working in the industry group as a whole can be attributed to differences in employment of electrical and electronic technicians. Workers in this profession typically test, modify, and repair electrical equipment. The occupation held the highest share of employment of any professional occupation in radiotelephone, with 2.7 percent. In contrast, electrical and electronic technicians made up less than 1 percent of telephone industry employment as a whole.

Sales occupations. Employees working in these occupations include those selling goods or services and others whose work is directly related to sales. In 1991, persons working in sales occupations made up only 4.6 percent of employment in telephone communications; however, sales occupations were much more important in the radiotelephone component, where they accounted for 18.4 percent of total employment. Again, as was the case with marketing managers, salesworkers are apparently in relatively high demand in industries providing new services, where the potential for first-time customers is greatest.

Sales agents who sell business services held a 10.6-percent share of employment in the radiotelephone component. This high percentage is not unexpected, as the primary services supplied by the radiotelephone component--cellular telephone, paging, and beeper services-are used in great numbers by businesses. Business service sales agents made up the second most common occupation reported by the radiotelephone industry, with more than 54 percent of all responding establishments employing at least one such worker. By contrast, the telephone industry in general employed only 2.3 percent of its work force in the selling of business services, and only slightly more than 26 percent of the responding firms reported having any employees in the occupation at all. Again, without the availability of the highly detailed data on the radiotelephone component, it would appear that salesworkers were not important in the telephone industry group or its components. These workers, however, accounted for nearly 1 in 5 employees in the radiotelephone sector in 1991.

Clerical and administrative support occupations, Employees in this occupational division perform tasks such as typing, filing, and record keeping. Clerical and administrative support occupations were the most prevalent jobs in the telephone communications industry group, as well as in its radiotelephone component, making up 41.6 percent and 43.6 percent of 1991 employment, respectively.

Customer service representatives held the highest proportion of all clerical jobs both at the industry group level and in its radiotelephone component, with 7.6 percent in each. Firms engaged in these types of businesses have many clients, all of whom pay for their services individually. Therefore, to provide satisfactory service, these firms have to hire large numbers of customer service representatives. These employees are responsible for receiving phone orders for initiating, discontinuing, or changing the kind or level of service. Other duties they may have include investigating and resolving customers' questions concerning service.

In addition to customer service representatives, the radiotelephone component employed 8.8 percent of its work force as bookkeeping clerks and adjustment clerks. In contrast, the telephone industry group allocated only 2.9 percent of its employees to these occupations in 1991. Bookkeeping clerks and adjustment clerks are typically responsible for keeping track of all customer records, as well as for resolving questions related to billing. Customers may be less familiar with the service options and billing practices of firms in the newer radiotelephone industry. Such firms must therefore hire these clerks in greater proportions than the industry group as a whole.

At the industry group level, the employment pattern was driven by traditional telephone firms, which employed telephone operators in large numbers. Directory assistance operators and central office operators made up 8.5 percent of total employment in telephone communications. By contrast, they accounted for only 1.4 percent of radiotelephone employment. These workers are not in high demand in radiotelephone establishments because, in the cellular phone industry, for example, when a customer calls an operator, the system switches the call to the operator provided by the local telephone exchange carrier or to the patron's long-distance operator of choice. Although establishments in the radiotelephone component and those in the telephone industry group employ clerical workers in roughly the same proportion, the occupational needs of these different types of establishments vary widely.

Production, construction, operating, maintenance, and material-handling occupations. Workers in this occupational division include those performing machine and manual tasks involved in production, construction, operating, maintenance, and material-handling operations. Nearly 34 percent of all workers in telephone communications were employed in this division. While the industry group as a whole had a large proportion of employment in production-related occupations, the radiotelephone segment allocated only 12.1 percent of its work force to these same roles.

Once again, the wireless aspect of the radiotelephone industry dictated the relatively low level of production worker employment. Firms engaged in providing radiotelephone services simply do not rely heavily on production and construction workers, because they do not support services such as the installation and repair of phone lines and wire telephones, the mainstay of much of the telephone communications industry group. For example, telephone line installers and repairers held the highest proportion of industry group production employment, with 10.6 percent. This same occupation held the largest proportional share of production occupations in the radiotelephone component as well; however, less than 3 percent of all workers in the component earned livings as line installers and repairers.

Other important production professions in the telephone industry group included private branch exchange (PBX) installers and repairers, station installers and repairers (persons who install and repair telephone booths and switching key equipment), and first-Free supervisors of mechanics and repairers. At the industry group level, these three occupations together made up nearly 16 percent of total employment. In the newer radiotelephone segment, they held only a 3.3percent share of employment. Clearly, the wireless nature of radiotelephones makes the component much less dependent on production workers, traditionally so important to the telephone industry group.

Summary

With the availability of component industry data, the differences in occupational employment between firms providing radiotelephone services and firms offering all telephone communications services are readily highlighted. The four-digit estimates allow a more accurate view of the occupational requirements of the new radiotelephone industry. Without these estimates, data from the three-digit industry group would most likely be used as a proxy. This research summary has shown, however, that establishments engaged in radiotelephone communications have widely different occupational needs from those in the entire telephone industry, which is heavily dominated by wire telephone carriers.

The reasons for the occupational differences cited include the radiotelephone industry's being in a developmental phase, as well as the fact that its firms use different technology from the telephone industry as a whole. The radiotelephone component's developmental phase is clearly reflected in the large number of salesworkers the industry group employs. As radiotelephone services become more popular, this trend may change. Equally notable are the large differences uncovered between the two industries in their proportions of production occupations. In 1991, the radiotelephone establishments employed 12.1 percent of their workers in production occupations, whereas such occupations accounted for 34 percent of industry group employment. Differences in production worker employment levels stem from the wireless nature of the communications in radiotelephone establishments.

Without the ability to produce estimates for more narrowly defined industries, analysts are left with higher level (three-digit SIC) group proxies of the occupational makeup of those (four-digit SIC) industries. These proxies may be an inaccurate portrayal of the more detailed industry, as demonstrated in the case of the radiotelephone industry. In other instances, the occupational staffing patterns of firms at the industry group level may be similar enough to allow for an accurate proxy of the detailed components. Further research is planned to isolate other component industries from their industry group, in order to provide a more accurate picture of the occupational patterns needed to produce a specific good or service.

Footnotes

1 The SIC system is the standard underlying all Federal economic statistics classified by industry. This system categorizes major groups of industries by a two-digit code. Each two-digit major group is composed of one or more three-digit industry groups, which are in rum made up of one or more four-digit industry components.

2 Data from the OES survey are published each year in the form of national occupational estimates at the two-digit SIC level. Data at the three-digit SIC level are available upon request, and data for individual States may be obtained from each State's Employment Security Administration.

3 Estimates for occupations within SIC industry 4812 were calculated from raw survey data. Data for other four-digit industries are not available.

4 During the first year, the survey covers manufacturing industries, agricultural services, and hospitals; during the second year, mining, construction, finance, and service industries; and during the third year, trade, transportation, communications, public utilities, education, and government services industries.

5 Sampling frame supplements are used for the few industries--for example, railroads--not covered under unemployment insurance law.

6 The official title of SIC industry 4813, as stated in the Standard Industrial Classification Manual, is "Telephone Communications, Except Radiotelephone."

Michael P. McElroy is a supervisory economist in the Division of Occupational and Administrative Statistics, Bureau of Labor Statistics. Michael B. Hazzard is an economist in the same division.
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Title Annotation:Standard Industrial Classification; telecommunications industry
Author:McElroy, Michael P.; Hazzard, Michael B.
Publication:Monthly Labor Review
Date:Feb 1, 1994
Words:2626
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