Can you use correlation for percentages?


New Member
I have two variables: the number of employees who work from home in the firm and the number of independent contractors in the firm - and I have this data for 70 firms.

I am trying to determine what statistical measure of association I can use to determine whether there is a relationship between these two variables.

I assumed the best way to do this is to convert the two variables to percentages so that my hypothesis would be: there is a positive correlation between the percentage of telecommuters and percentage of independent contractors a firm has. However, I read that you cannot use correlation to compare two percentages.

I am not strong in statistics so I would be very grateful for any insight on whether what I am trying to do here seems logical, if converting to percentages to run the correlation makes sense, and if correlation is an acceptable means of determining association between two %s. If it is not, I would be very grateful for recommendations on statistical tests that would work best to determine the association between these two variables.


Less is more. Stay pure. Stay poor.
Depends on what you are using this for. If it is just for a general in-house analysis (that you are not publishing) - yeah a spearman correlation may give you a general idea of the relationship. I would also strongly recommend creating a scatterplot with these data.

If you want to do something more stringent, perhaps using beta regression may work.