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Homework Tampa Bay & Co. Hillsborough County Visitor report

Today Concepts in economic impact Concepts in economic impact Common ratios Common ratios The multipliers The multipliers The experts The experts

Truisms The easier it is to move, the less local factors can influence it. The easier it is to move, the less local factors can influence it. A dollar is only spent once, but what it’s spent on matters. A dollar is only spent once, but what it’s spent on matters. Whoever is paid to do an analysis will likely produce the answer that’s desired. Whoever is paid to do an analysis will likely produce the answer that’s desired. There is no right answer. No one really knows. There is no right answer. No one really knows.

Figure out Do the known numbers make sense? What change causes a big effect? Do the known numbers make sense? What change causes a big effect? Dollars per job: subsidy, spending or revenues Dollars per job: subsidy, spending or revenues Multipliers : Impact per dollar spent, jobs leveraged. Multipliers : Impact per dollar spent, jobs leveraged. A comparison: A comparison: Local totals (percent of total local economy) Local totals (percent of total local economy) National averages (dollars per job, multipliers) National averages (dollars per job, multipliers) Growth rate Growth rate Different units of measure: per dollar, per job, per mile built? Different units of measure: per dollar, per job, per mile built?

Industry$1,000 sales/emp loyee Characteristics Manufacturing $397 High wages, high productivity Construction $236 High wages, buy many materials locally Wholesale trade $959 Pass-through costs high Retail trade $253 Low wages, little bought locally Information $314 High wages, little indirect

Input-output modeling Basis of many economic impact statements Basis of many economic impact statements Every business buys something and sells something – the difference is value added. Every business buys something and sells something – the difference is value added. Do they buy things made locally? Construction often yes, retailing almost never. Do they buy things made locally? Construction often yes, retailing almost never. If you know one piece of the puzzle, you can estimate the rest, even if it’s not easy, based on the I-O tables of the National Accounts at the Bureau of Economic Analysis (the basis for calculating the GDP.) If you know one piece of the puzzle, you can estimate the rest, even if it’s not easy, based on the I-O tables of the National Accounts at the Bureau of Economic Analysis (the basis for calculating the GDP.)the I-O tables of the National Accounts at the Bureau of Economic Analysisthe I-O tables of the National Accounts at the Bureau of Economic Analysis

Elements of economic impact projections Actual spending (initial change) Actual spending (initial change) Direct effects Direct effects Indirect effects (earnings multiplier) Indirect effects (earnings multiplier)

Source: RIMS 2 user manualRIMS 2 user manua

TypeAmount Sports facility operation (initial change) $22.8 million / 250 jobs Purchases by sports facility (direct effects) $13 million / 175 jobs Earnings effect (payroll being spent on other local goods and services) $12 million / 190 jobs Total$47.8 million / 615 jobs

Watch out for… Most statistics are only for private industry – revenue shifted from government appears new. Most statistics are only for private industry – revenue shifted from government appears new. The more local the analysis, the lower the effect. The more local the analysis, the lower the effect. Most initial estimates come from interested players Most initial estimates come from interested players

Resources Bureau of Economic Analysis Bureau of Economic Analysis Bureau of Economic Analysis Bureau of Economic Analysis Local areas personal income and employment Local areas personal income and employment Local areas personal income and employment Local areas personal income and employment Regional Input-Output Modeling System (RIMS II) Regional Input-Output Modeling System (RIMS II) Regional Input-Output Modeling System (RIMS II) Regional Input-Output Modeling System (RIMS II) Value-added by industry Value-added by industry Value-added by industry Value-added by industry Bureau of Labor Statistics Bureau of Labor Statistics Bureau of Labor Statistics Bureau of Labor Statistics Quarterly Census of Employment Quarterly Census of Employment Quarterly Census of Employment Quarterly Census of Employment Census Bureau Census Bureau Census Bureau Census Bureau County Business Patterns County Business Patterns County Business Patterns County Business Patterns Economic Census (5-year cycles) Economic Census (5-year cycles) Economic Census (5-year cycles) Economic Census (5-year cycles)

Regional economic accounts Regional economic accounts

County business patterns

Economic census

Quarterly Emp & Wages Quarterly Emp & Wages

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