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What is a Labor Surplus Zone and is it beneficial to my business? A question we often hear at the PTAC.
There are forty-one (41) areas in Pennsylvania included on the latest Labor Surplus Area (LSA) listing, as determined by the U.S. Department of Labor (DOL), Employment and Training Administration. The list becomes effective each October 1st and remains in effect through the following September 30th.
LSA lists are used when deciding the recipients of federal government contracts. These areas have preference for contracts awarded under the federal procurement process. Struggling businesses and organizations receive extra consideration when their township, city or county appears on a LSA listing.
LSAs are classified based on civil jurisdictions. Civil jurisdictions are defined as all cities and townships of at least 25,000 population and all counties.
In order to qualify as a LSA, an area (city, township, county or balance of county) must have an unemployment rate twenty percent above the national annual average during the reference period, or the floor rate of 6.0 percent during periods of low national unemployment.
The current reference period is January 2016 through December 2017 and has a national average unemployment rate of 4.66 percent during this span. Because the national average unemployment rate times 1.2 (which equals 5.59 percent) is below the floor rate, the rounded qualifying rate is the floor rate of 6.0 percent.
The current list of Pennsylvania LSAs includes those that had a floor unemployment rate for the January 2016 through December 2017 reference period.
Who are some of the users of the LSA List, and how do they use it?
- The Administrator for Federal Procurement Policy uses the LSA list to identify where procurement set asides should be emphasized in order to strengthen our nation's economy;
- General Service Administration (GSA) Online Representations and Certifications Application (ORCA) system uses the LSA list as a tool to determine if a business qualifies as a Labor Surplus Area concern; and,
- The Small Business Administration uses the LSA list for bid selections for small business awards in Historically Underutilized Business Zones (HUBZones).
The DOL issues the LSA listing on a fiscal year basis. The current list of LSAs will be in effect from October 1, 2018 through September 30, 2019. Below is a map and list of Pennsylvania's LSAs for fiscal year 2019. Areas not meeting the criteria may qualify by special petition from the state's employment security agency to the U.S. Department of Labor, if they meet additional specifications.
The following LSA List Table outlines jurisdictions approved in the region receiving programs and services from the Procurement Technical Assistance Center at the Northeastern Pennsylvania Alliance:
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AREA TYPE
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NAME
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COUNTY
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| City |
Hazleton City |
Luzerne County |
| City |
Wilkes-Barre City |
Luzerne County |
| County |
Monroe County |
Monroe County |
County
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Pike County |
Pike County |
County
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Schuylkill County |
Schuylkill County |
Sources:
PA Department of Labor & Industry Center for Workforce Information & Analysis
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