A principal components analysis of labour sectoral transfers

Net sectoral transfers are generally low and stable following the UK's economic shock of the late 80's and early 90's. However, previous work has shown that this low level of general inter-sectoral labour transfer is not homogenous, but rather that the general level conceals the fact that some industrial sectors are more active than others in this regard. This is witnessed in the manner in which sectors correlate differently for labour transfers, showing the extent to which they recruit from and displace to, other sectors within the economy. Indeed, the Construction Sector is the most influential. An all-sector exploratory principal components analysis was undertaken to establish those constructs or dimensions which could account for such observed associations. This has identified underlying characteristics of the labour market that explain the differences in terms of their externality to the variables considered, but which are yet within context; i.e. they explain the movement of workers from one industrial sector to another. The analysis resolves to just two principal components; namely, educational level / skill attainment and the level of skill-specificity attaching to each sector. These may then be mapped to indicate the central position played by the construction sector in the labour market and its position relative to all other sectors.