Are national or regional surveys useful for nowcasting regional jobseekers? The case of the French region of Pays-de-la-Loire

Abstract

In this paper we develop nowcasting models for the Pays-de-la-Loire's jobseekers, a dynamic French regional economy. We ask whether these regional nowcasts are more accurate by only using the regional data or by combining the national and regional data. For this purpose, we use penalized regressions, random forest, and dynamic factor models as well as dimension reduction approaches. The best nowcasting performance is provided by the DFM estimated on the regional and regional-national databases as well as the Elastic-Net model with a prior screening step for which the national data are the most frequently selected data. For the latter, it appears that the Change in foreign orders in the industry sector, the OECD Composite leading indicator, and the BdF Business sentiment indicator are among the major predictors.