No. You need the overall Location service on, which essentially means that your device can locate where you are using GPS, wi-fi, mobile data, or some combination. Location Reporting is used to report your location to certain Google services like Google+ (if you want to share your location with friends) and Google Offers. I always keep Location Reporting off until I need it (usually only if I'm checking Google Offers), because for some people, it can contribute a little to battery drain, since it causes the system to partially wake up more frequently to report to the web.