Economic Analysis with IMPLAN presented in WF ED 543, Evaluation of Investments in Workforce Education & Development, at Penn State

1. Economic Impact Analysis with IMPLAN WF ED 543

3. For information after today http://PSU-IMPLAN-Refs.notlong.com

4. Input-Output Analysis A systematic view of production and consumption in an economy

5. Sex life of a regional economy < the birds & bees of job creation >

6. The economy is like a ball of string < complex > < intertwined > < large > < unexpected >

7. Way to organize data < input-output tables > Summarize production & consumption.

8. Input-output table ind 1 ind 2 ind 3 ind 4 ind 1 ind 2 ind 3 ind 4 final demand total output

12. Simple input-output table ind 1 ind 2 ind 3 ind 4 ind 1 ind 2 ind 3 ind 4 final demand total output

13. Industries produce goods & services ind 1 ind 2 ind 3 ind 4 ind 1 ind 2 ind 3 ind 4 final demand total output producers

14. Industries purchase goods & services ind 1 ind 2 ind 3 ind 4 ind 1 ind 2 ind 3 ind 4 final demand total output purchasers

15. Production sector of the economy ind 1 ind 2 ind 3 ind 4 ind 1 ind 2 ind 3 ind 4 final demand total output

16. Production sector of the economy ind 1 ind 2 ind 3 ind 4 ind 1 ind 2 ind 3 ind 4 final demand total output interindustry transactions

17. Production sector of the economy ind 1 ind 2 ind 3 ind 4 ind 1 ind 2 ind 3 ind 4 final demand total output direct requirements

18. A closer look at interindustry transactions ind 1 ind 2 ind 3 ind 4 ind 1 ind 2 ind 3 ind 4 final demand total demand purchases of ind 2 from ind 1

19. A closer look at interindustry transactions ind 1 ind 2 ind 3 ind 4 ind 1 ind 2 ind 3 ind 4 final demand total demand purchases of ind 3 from ind 2; or, ind 2 produces for ind 3

20. A closer look at interindustry transactions ind 1 ind 2 ind 3 ind 4 ind 1 ind 2 ind 3 ind 4 final demand total demand purchases of ind 1 from itself; some industries use the products they make

21. Industry production function -- the direct supply chain ind 1 ind 2 ind 3 ind 4 ind 1 ind 2 ind 3 ind 4 final demand total demand All purchases of ind 1; aka industry production function

22. Producing & purchasing continues until goods or services created ind 1 ind 2 ind 3 ind 4 ind 1 ind 2 ind 3 ind 4 final demand total demand < make/use… make/use… make/use… the production cycle goes round & round >

23. Consumption ind 1 ind 2 ind 3 ind 4 ind 1 ind 2 ind 3 ind 4 final demand total output

24. Final demand… Gross domestic product… ind 1 ind 2 ind 3 ind 4 ind 1 ind 2 ind 3 ind 4 final demand total demand ind 1 ind 2 ind 3 ind 4 < personal consumption > < government purchases > < investment > < export >

25. Total economic output… ind 1 ind 2 ind 3 ind 4 ind 1 ind 2 ind 3 ind 4 final demand total output production + consumption = total output

26. An Example of an Input-Output Table

27. Here is the sex part…. < where jobs come from >

29. Jobs are tied to total output… ind 1 ind 2 ind 3 ind 4 ind 1 ind 2 ind 3 ind 4 final demand total output ind 1 ind 2 ind 3 ind 4 < in each industry, it takes a certain number of people to create a dollar’s worth of total economic output >

30. Jobs are tied to total output… ind 1 ind 2 ind 3 ind 4 ind 1 ind 2 ind 3 ind 4 final demand total output ind 1 ind 2 ind 3 ind 4 < if It takes .001 workers to create $1 of economic output, then,

31. Jobs are tied to total output… ind 1 ind 2 ind 3 ind 4 ind 1 ind 2 ind 3 ind 4 final demand total output ind 1 Ind 2 ind 3 ind 4 < if It takes .001 workers to create $1 of economic output, then, with $1 billion of total industrial output, 1 million workers are required >

32. Jobs are tied to total output… ind 1 ind 2 ind 3 ind 4 ind 1 ind 2 ind 3 ind 4 final demand total output ind 1 ind 2 ind 3 ind 4 < changes in labor intensity or in total economic output create changes in numbers and kinds of jobs >

33. Occupational employment is tied to total industrial output… ind 1 ind 2 ind 3 ind 4 ind 1 ind 2 ind 3 ind 4 final demand total output ind 1 ind 2 ind 3 ind 4 < industries use different occupations > < industries use different labor intensities > < occupational employment differs by industry >

34. Occupational employment is created.. … when people use their unique human capital to create goods & services

35. Results of input-output analysis

37. Local uses of input-output analysis < producer & purchaser data > < multipliers >

38. Multiplier A product of input-output analysis

39. producer/purchaser data… ind 1 ind 2 ind 3 ind 4 ind 1 ind 2 ind 3 ind 4 final demand total output producers purchasers

41. Producing & purchasing multiplies… ind 1 ind 2 ind 3 ind 4 ind 1 ind 2 ind 3 ind 4 final demand total demand

46. Two types of multipliers type 1 = type 2 = direct + indirect direct direct + indirect + induced direct

47. Some employment multipliers

50. Waste/recycling multipliers for Pennsylvania

51. Loss of opportunity Penn State research on: Community Costs of Technical Skills Deficits

52. Quick response, regional impact Penn State research: Economic & Workforce Brief series http://PSUBrief.notlong.com

53. Economic Impact Analysis with IMPLAN WF ED 543