Economic Letter
Brief summaries of SF Fed economic research that explain in reader-friendly terms what our work means for the people we serve.
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Measuring Labor Market Similarities in Nearby Regions
Leila Bengali, Cheikh Fall
Labor market conditions are similar in regions that are near each other. This is called positive spatial correlation. Analyzing county-level data from 1990 to 2024 shows that commuting flows may contribute to strong spatial correlation in employment growth. Spatial correlation appears to have strengthened since the 1990s, at the same time as more workers were commuting across county lines. As these connections grow through commuting flows, both favorable and challenging conditions in local economies may become more likely to spread farther than in the past.
