Competitive Effect

Competitive effect indicates how much of the job change within a given region is the result of some unique competitive advantage of the region. This is because the competitive effect, by definition, measures the job change that occurs within a regional industry that cannot be explained by broader trends (i.e. the National Growth Effect and the Industrial Mix Effect).

To measure competitive effect, we subtract Expected Change from the actual regional job change in the industry of interest.

Actual Change – Expected Change = Competitive Effect

It’s important to note that this effect can be positive even if regional employment is declining. This would indicate that regional employment is declining less than national employment.

See this article for more.