| Understanding Your Industry: Qualitative Approaches to Identifying Key Industries
In addition to quantitative analysis, many economic
development professionals have found qualitative research to
be very useful in identifying and analyzing key industries and
clusters. Based on a survey
of state economic development research directors, the Humphrey
Institute's State and Local Policy Program found that several
states are moving toward greater use of qualitative analysis
in their industry research. Qualitative analysis allows researchers
to both find out why certain trends in data have occurred and
complete the story quantitative analysis provides. Qualitative
analysis is also useful as a first step in determining what
data and quantitative analysis should be considered.
By qualitative analysis we mean the use of research
techniques that help answer the question "why" and
provide greater understanding of the reasons behind quantitative
trends and results. Focus groups, interviews, and case studies
are qualitative research techniques. While quantitative approaches
will tell you how many jobs were created in a given industry,
a qualitative approach can help you determine why they were
created. Qualitative analysis often includes the consideration
of indicators and factors that may not be easily quantifiable.
These measures might include environmentally clean, family friendly,
or high quality of life. While quantitative indicators can be
used to help define or measure quality of life or an industry's
environmental friendliness, it often requires qualitative research
to determine them.
By qualitative analysis we mean analysis of indicators
and factors that may not be easily quantifiable. These measures
might include environmentally clean, family friendly, or high
quality of life. While you can develop quantitative indicators
to help define quality of life or an industry's environmental
friendliness, there is usually no one agreed upon measure for
them.
In this section we look briefly at three ways
to use qualitative analysis to better understand your region's
industries. These include:
Identify
key industries
In identifying key industries, states and regions often look primarily
at quantitative data. However, many are beginning to look more
closely at qualitative measures and criteria that often reflect
desirable characteristics the state or region would like to promote
or encourage. While most states and regions look at similar quantitative
measures in identifying key industries (e.g., employment, wages,
earnings), the list of qualitative criteria used in identifying
key industries often varies from place to place. Ideally, these
qualitative criteria reflect an area's unique character, priorities,
and reality.
Determining what key qualitative-and quantitative-criteria
should be used in identifying key industries often requires setting
state and regional priorities and objectives. Through strategic
planning processes that often employ qualitative approaches (interviews,
focus groups), states and regions usually will identify key industries,
values, skills, or resources they would like to strengthen or
promote.
Qualitative measures for identifying
key industries
The following is a list of some of the criteria
used by states, regions, cities and other areas in their economic
development analysis. Some of these may be easier than others
to quantify and some will be important to some areas and not
others.
- environmentally sound or clean (common priority in many
areas)
- infrastructure needs
- energy
- transportation
- communications network
- workforce skills are desirable
- provides training and skill enhancement
- offers economic diversity
- may attract other businesses to the area
- utilizes high-tech processes
- contributes positively to quality of life
- headquarters or a hub
Identify
industry clusters
Qualitative approaches have been very useful to states
and regions looking at developing industry clusters. Many states
use interviews and focus groups, for example, to identify important
forward and backward linkages among industries, common and complementary
labor, infrastructure, and input needs. Some states identify industry
clusters through interviews with firms about their suppliers.
In determining industry clusters, many states and
regions look beyond data and quantitative analysis to more qualitative
measures. A researcher director included in the State and Local
Policy Program's survey reported that his state groups industries
by "function not product." Other states group industries
based on labor, energy, and transportation requirements as well
as common technologies and workforce skills. One region has defined
a key cluster of industries it wants to promote by a major input
requirement: warm water. The region's energy plants generate a
considerable amount of warm water that the region would like to
recycle. Thus, the region is promoting the development of a cluster
of greenhouse and related businesses in the area.
For more information on how states and regions
have used qualitative analysis to identify key industries, view
the Industry
Cluster Studies.
Determine
needs of industries and industry clusters
Many states and regions use qualitative analytical techniques
as a way to understand the clusters they identified through the
analysis of existing data. Although data on, for example, the
occupational profiles and input requirements of various industries
exist and can be collected, a potentially better way to learn
about industries is through more qualitative approaches. Through
meetings with industry association representatives as well as
state and regional business leaders from these industries or clusters,
you can learn more about the linkages among industries, and their
anticipated workforce changes and infrastructure demands.
View the Industry
Cluster Studies to learn about ways to analyze key industries.
Included in this section is a series of questions
used in regional industry cluster studies in Minnesota. These
questions can be used by other states or regions interested in
developing a better understanding of their key industry clusters
and their economy. You may also find it helpful to explore some
examples
of techniques other states and regions have used to analyze industry
clusters. |
