What Is the Purpose of Factor Analysis?

••• Kantamard Lamasai/iStock/GettyImages

Factor analysis is a statistical data reduction and analysis technique that strives to explain correlations among multiple outcomes as the result of one or more underlying explanations, or factors. The technique involves data reduction, as it attempts to represent a set of variables by a smaller number.

Function

Factor analysis attempts to discover the unexplained factors that influence the co-variation among multiple observations. These factors represent underlying concepts that cannot be adequately measured by a single variable. For example, various measures of political attitudes may be influenced by one or more underlying factors.

Significance

Factor analysis is especially popular in survey research, in which the responses to each question represent an outcome. Because multiple questions often are related, underlying factors may influence subject responses.

Considerations

Because the purpose of factor analysis is to uncover underlying factors that explain correlations among multiple outcomes, it is important that the variables studied be at least somewhat correlated; otherwise, factor analysis is not an appropriate analytical technique.

Warning

Factor analysis requires the use of a computer, usually with a statistical software program, such as SAS or SPSS. The spreadsheet program Excel cannot conduct factor analysis without a program that expands its statistical capabilities.

Prevention/Solution

One program that enables Excel to conduct more complex statistical analysis, such as factor analysis, is XLStat, which can be purchased online.

Related Articles

How to Calculate Weighted Factors
The Difference Between Cluster & Factor Analysis
Disadvantages of Factor Analysis
How to Calculate a P-Value
How to Calculate Weighted Factors
How to Report the Results of Confirmatory Factor Analysis
How to Find a Z Score
How to Factor Polynomials With a TI-83 Plus
How to Calculate a Sigma Value
How to Factor Polynomials With 4 Terms
Science Project Ideas & the Scientific Method
Test Your Knowledge on Middle School Science
Differences Between Conceptual Independent Variables...
How to Use the Pearson Correlation Coefficient
The Difference Between Cluster & Factor Analysis
How to Convert Pounds Per Square Foot to PSI
How to Divide Rational Numbers
How to Create Bar Charts From Likert Scale Results
How to Factor Negative Numbers
How to Calculate CV Values