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Urban Planning 237A: Sectoral Analysis

This guide was developed based on Professor Wolff's work for his UP 237A graduate course. Sectoral analysis provides a foundation in methodology as well as salient issues in the field of urban planning.

Initial Questions about the Industry That Must Be Answered

What is the basis for industry profitability? Follow the money!

What, exactly, are the products being made (or services being provided) and for whom? Are they for consumers or they intermediate?

What are the NAICS definition and code(s) for this industry? What was the SIC definition and code(s)?

How large is the industry, number of workers? Sales?  In the U.S.?  In Los Angeles County?

What is the market? Local? Regional? Global?

Identify and learn industry-related terminology

Get a sense of the history of the industry--note turning points, shifts in geography, production methods, type of product of service, labor force

What are the recent dynamics of the industry (consider competitiveness issues, industry strategies

Identify key trade associations, industry periodicals

List the major firms in Los Angeles, U.S., (and any key foreign-owned firms)

Geographical Dimensions

  • spatial concentrations, regional, national (map establishments , employment, output) [i]
  • calculate shift-share; location quotient [i]
  • geographic turning points, nationally, locally
  • location of related industries (supplier/buyer)
  • indications of plant closings/relocation/expansion patterns (to other parts of U.S., other countries, Border)
  • importance of access to markets
  • access to what types of transportation?
  • site requirements for the industry--labor force, transportation, land, buildings, utility needs, waste disposal
  • map specific sites in the region
  • determine reasons for location in the region, elsewhere

[i] = industry as a whole

Industry-Government Relations

  • does local, state, fed government concern itself with the industry?
  • to what extent is the industry's economic structure regulated by govt.?
  • regulatory agencies--SCAQMD, CalOSHA, Workers' Comp, Dept of Labor code enforcement, INS/IRCA, local zoning
  • subsidies – local, state, fed
  • how do tax and investment policy affect the industry
  • is the public sector a major customer or supplier to the industry?
  • community concerns with the industry
  • the social responsibility record of a company

Structure of the Industry

When looking at the structure of the industry, the following information is key. Please note that some will be industry-wide information, while others are available only for individual companies or firms.

  • employment
  • output (sales/shipments)
  • number of firms, production units [i]
  • establishment size distributions [i]
  • ownership (public, privately held, local family, subsidiary, foreign d.i.)
  • concentration ratios [i]
  • structure (branches)
  • subcontracting, outsourcing (formal, informal?)
  • offshore subsidiaries? twin plants?
  • number of years in business [f]
  • note history of mergers, buy-outs, business failures

[i] = industry as a whole

[f] = individual firms

Internal Composition of the Industry

Industry information is available primarily at the national level.  To find information for Los Angeles county, city, or the region you will need to use a variety of business, news and article sources to piece it together. Depending on the industry, you may find information more readily available. If the leading companies in an industry are private, information will be more difficult to find, if it is available at all.

Common information and variables to help determine the internal composition of an industry:

  • research and development
  • product design
  • describe key production processes
  • new technologies
  • identify inputs (and their source)
  • capital expenditures
  • equipment (types, cost, degree of automation)
  • flexible vs fordist production
  • capital/labor intensity
  • output
  • value added/productivity measures

Industry as Cluster

  • commodity chains
  • suppliers
  • materials, sources of
  • related sectors:  input/output linkages (upstream, downstream)
  • distribution channels
  • existence of industry clustering (spatial, labor market) [i]
  • client relationships
  • existence of networks [i]

[i] = industry as a whole

Industry Power Structure

  • identify trade associations, networks
  • what are key issues that concern the industry (legislative, community, corporate, trends)?
  • what government/utility/community programs are there to assist the industry? 
  • links to public officials
  • are there any industry leaders? (within the industry or who are viewed as industry spokespeople, including "experts")?
  • look for possible linkages beyond the industry to related sectors (supplier sectors, real estate, finance, wholesale, retail, etc.)