Industries: Location Quotient
The location quotient is a tool used to measure the strength of each industry relative to the national average. An industry with a score of 1 would indicate that the percent employed is the same as the national percent employed. A score above 1 indicates that the region has a higher than average concentration and a score of less than one is indicative of a lower than average concentration.
More specifically, industries with scores of 1.25 indicate a strong regional advantage in that industry. The region likely exports the goods or services of this industry to the rest of the world. Conversely, a score of .75 or less would indicate an industry that the region lacks specialty in and must import those goods and services from elsewhere.
Source: Bureau of Economic Analysis
Kansas City does have a clear concentration in the Information sector with a location quotient of 1.80. Much of this concentration is certainly due to the region's largest private employer Sprint-Nextel. This industry has struggled somewhat in recent years and has been one reason for the lackluster economic growth experienced in the Kansas City area since 2001.
While the Federal Government has looked to downsize recently, Federal employment has remained strong in Kansas City. The area is a regional office for several Federal programs and home to the Kansas City Federal Reserve Bank.
