Basic Analysis

Institutional Spending Pattern Events

August 12, 2020/0 Comments/in Basic Analysis, IMPLAN Users Guide, Support Site/by Joe Demski

INTRODUCTION

Institutional Spending Patterns, like all Spending Patterns, are made up of a list of Commodities, although Institutional Spending Patterns include government payroll Commodities to capture spending on Labor. Because Institutions are Final Demanders, in the case of Institutional Spending Patterns, each Commodity in the Spending Pattern is treated like a Commodity Output Event and will create a Direct Effect.

Event Type	Institutional Spending Patterns
Event Use	Analyzing general fiscal spending changes
Event Specification ”WHO”	Federal Government NonDefense Federal Government Defense Federal Government Investment State/Local Govt. Other Services State/Local Govt. Education State/Local Govt. Hospital & Health State/Local Govt. Investment Capital Inventory Additions/Deletions
Event Value “WHAT”	Total Spending on Goods, Services and Labor

INSTITUTIONAL SPENDING PATTERN EVENTS

IMPLAN can be accessed via app.IMPLAN.com. Once you are logged in, you will be directed to the IMPLAN dashboard. From the dashboard you can navigate to the Regions, Impacts, or Projects screen.

Once you have chosen your Region and named your new Project, you will be directed to the Impacts screen. From here, click on Add New Event to create a Institutional Spending Pattern Event. In this set of examples, 2018 Nevada data is utilized.

Institutional Spending Pattern Events are unique in that they describe both Intermediate Inputs and Value Added within the same Spending Pattern. This results in these Spending Patterns producing ‘mixed results;’ where the reported Direct Effects describe both what we would generally consider Direct Effects (income, Employment and Value Added) and the first-round Indirect Effects that arise from the government spending its budget. Institutional Spending Pattern Events can be edited. Learn more in the article Editing Institutional Spending Pattern Events.

In this example, we want to look at a potential $1M increase in education spending by the government. We will give our new Event a Title, select the Type as Institutional Spending Pattern, the Specification is 12002 – State/Local Government Education, and the Value is $1,000,000.

Now that you have your Event, ensure that it is highlighted in teal by clicking on the Event or checking Select All Events at the top of the screen. Now the Events can be dragged into your Group on the right.

You will know when the Events have populated in the Group when the number in the upper right of the Group box equals the number of Events.

Now click Run in the bottom right of the Impacts Screen.

The Institutional Spending Pattern Event Type represents a general spending distribution for measuring broad Institutional activity in your Region.

Industry Contribution Events

August 12, 2020/0 Comments/in Basic Analysis, IMPLAN Users Guide, Support Site/by Joe Demski

INTRODUCTION

Industry Contribution Analysis (ICA) is a method used to estimate the value of an Industry or group of Industries in a Region, at their current levels of production. While the focus of the analysis still looks at backward linkages, the purpose of this analysis differs from the standard economic impact analysis. ICA shows the relative extent and magnitude of the Industry, event, or policy in the study area.

ICA is a unique method which applies a constraint upon the model by removing feedback linkages (buybacks) to the Industry being analyzed. This method can also be used with single firms, but if/when it is, the results of this method should be considered conservative.

ICA denotes that the study is looking at how the current state of an Industry supports other businesses in the local economy. When this involves a single firm, the analyst will need to determine if the Impact Method or Industry Contribution Analysis Method should be used. The results in either case should be described with words such as “contributes to” or “sustains.”

Event Type	Industry Contribution
Event Use	Estimating effect of an existing Industry’s production
Event Specification ”WHO”	Industry 1-546 for which the contribution is being measured
Event Value “WHAT”	Output or % of Industry

INDUSTRY CONTRIBUTION EVENTS

IMPLAN can be accessed via app.IMPLAN.com. Once you are logged in, you will be directed to the IMPLAN dashboard. From the dashboard you can navigate to the Regions, Impacts, or Projects screen.

Once you have chosen your Region and named your new Project, you will be directed to the Impacts screen. From here, click on Add New Event to create a Industry Contribution Event. In this set of examples, 2018 Nevada data is utilized.

In this example, we want to look at the contribution of the entirety of the hotel Industry in Nevada. We will give our new Event a Title, select the Type as Industry Contribution Analysis, the Specification is 507 – Hotels and motels, including casino hotels, and the Value is 1. The buttons after the Event Value give us the choice between entering a dollar value or entering a percentage of the total Industry. In that we want to see the entire Industry, we will select the %. Check out the article Picking an Industry for assistance in choosing the appropriate IMPLAN Industry.

Now that you have your Event, ensure that it is highlighted in teal by clicking on the Event or checking Select All Events at the top of the screen. Now the Events can be dragged into your Group on the right.

You will know when the Events have populated in the Group when the number in the upper right of the Group box equals the number of Events. You will also see a new icon in teal indicating that this is an Industry Contribution Analysis.

Now click Run in the bottom right of the Impacts Screen.

To see how the constraints on the hotel Industry worked, navigate to the Output tab in the Results. The largest Industry in terms of Output was Industry 507 – Hotels and motels, including casino hotels with a total of $15,193,837,564.97. On the Industries by Impact table, you can see that the entirety of this was in the Direct Effect and the Indirect and Induced Effects in this Industry are zero. If we had used a standard Industry Output Event, there would be additional Indirect and Induced Effects in our Results.

Industry Spending Pattern Events

August 12, 2020/0 Comments/in Basic Analysis, IMPLAN Users Guide, Support Site/by Joe Demski

INTRODUCTION

Industry Spending Patterns include all Intermediate Inputs for a given Industry. Industry Spending Pattern Events are most appropriate to use when an analyst has the data required to build a customized Spending Pattern which reflects specific purchases by an Industry or when the ratios in an Industry’s Leontief Production Function must be modified to a degree beyond that which is achievable by simply customizing an Industry Event.

Event Type	Industry Spending Patterns
Event Use	Analyzing a change in Intermediate Inputs
Event Specification ”WHO”	Industry 1-546 making purchases of Intermediate Inputs
Event Value “WHAT”	Intermediate Inputs or Output (per Advanced Menu)

INDUSTRY SPENDING PATTERN EVENTS

IMPLAN can be accessed via app.IMPLAN.com. Once you are logged in, you will be directed to the IMPLAN dashboard. From the dashboard you can navigate to the Regions, Impacts, or Projects screen.

Once you have chosen your Region and named your new Project, you will be directed to the Impacts screen. From here, click on Add New Event to create an Industry Spending Pattern Event. In this set of examples, 2018 Nevada data is utilized.

At the most basic level, Industry Spending Pattern Events can be used to examine the economic impact of only the Intermediate Inputs of an Industry. Intermediate Inputs are the purchases of non-durable goods and services that are used to produce other goods and services rather than for final consumption. Industry Spending Patterns can be edited through the Advanced Menu. Learn more in the article: Editing Industry Spending Pattern Events.

In this example, we want to look at only the spending on Intermediate Inputs by casinos. We will give our new Event a Title, select the Type as Industry Spending Pattern, the Specification is 503 – Gambling industries (except casino hotels), and the Value is $1,000,000. Check out the article Picking an Industry for assistance in choosing the appropriate IMPLAN Industry.

Now that you have your Event, ensure that it is highlighted in teal by clicking on the Event or checking Select All Events at the top of the screen. Now the Event can be dragged into your Group on the right.

You will know when the Events have populated in the Group when the number in the upper right of the Group box equals the number of Events.

Now click Run in the bottom right of the Impacts Screen.

The first thing you will notice is that there are no Direct Effects. Industry Spending Pattern Events only affect spending on Intermediate Inputs, so there will only be Indirect and Induced Effects. Learn more in the article Explaining Event Types.

Industry Spending Pattern Events are often used as part of Analysis-by-Parts (ABP). ABP allows you to examine a specialized Industry or a firm that is not reflected by an IMPLAN Industry due to differences in the structure of the Leontief Production Function and/or Spending Pattern that cannot be edited via a single Industry Event. This type of analysis is typically used to split the stemming ripple effects of an Industry Impact into its individual impact components – budgetary Spending Pattern (Intermediate Inputs), which can be analyzed using an Industry Spending Pattern Event, and payroll, which can be analyzed using Labor Income Event(s).

Household Income Events

August 12, 2020/0 Comments/in Basic Analysis, IMPLAN Users Guide, Support Site/by Joe Demski

INTRODUCTION

Household Income Events are appropriate to model a change in Household Income isolated from Industry production and payroll. In Household Income Events, you can specify the specific income group(s) receiving the income. Examples would be a government stimulus check or tax refund.

Household Income values should include all new Household Income the residents will receive including personal tax and savings. IMPLAN will automatically deduct personal tax and savings. Household spending of income on imported goods and services will also be treated as leakage.

Event Type	Household Income Events
Event Use	Analyzing a change in Household Income separately from production
Event Specification ”WHO”	HH LT15K, HH 15-30K, HH 30-40K, HH 40-50K, HH 50-70K, HH 70-100K, HH 100-150K, HH 150-200K ,HH GT200K
Event Value “WHAT”	Total Household Income for specified income group

HOUSEHOLD INCOME EVENTS

IMPLAN can be accessed via app.IMPLAN.com. Once you are logged in, you will be directed to the IMPLAN dashboard. From the dashboard you can navigate to the Regions, Impacts, or Projects screen.

Once you have chosen your Region and named your new Project, you will be directed to the Impacts screen. From here, click on Add New Event to create a Household Income Event. In this set of examples, 2018 Nevada data is utilized.

Household Income represents the income received by people for their participation in production, from government and business transfer payments, and from returns on capital (e.g., interest payments, dividends). Household Income Events allow the analyst to pick which income group(s) will receive the gain or loss of income.

Specification	Explanation
Households LT15k	Those earning less than $15,000
Households 15-30K	Those earning between $15,000 and $30,000
Households 30-40K	Those earning between $30,000 and $40,000
Households 40-50K	Those earning between $40,000 and $50,000
Households 50-70K	Those earning between $50,000 and $70,000
Households 70-100K	Those earning between $70,000 and $100,000
Households 100-150K	Those earning between $100,000 and $150,000
Households 150-200K	Those earning between $150,000 and $200,000
Households GT200K	Those earning greater than $200,000

In this example, there will be a stimulus check for households that earn less than $40,000. We are told this will result in $2,000,000 of new income in Nevada for households earning less than $15K, $1,500,000 for households earning between $15-30K, and $3,000,000 for households earning between $30-40K. Therefore, we will set up one Household Income Event for each household level.

Now that you have your Events, ensure that all are highlighted in teal by clicking on them individually or checking Select All Events at the top of the screen. Now the Events can be dragged into your Group on the right.

You will know when the Events have populated in the Group when the number in the upper right of the Group box equals the number of Events.

Now click Run in the bottom right of the Impacts Screen.

The first thing you will notice is that there are no Direct or Indirect Effects. Household Income Events only affect household spending, so there will only be Induced Effects. Learn more in the article Explaining Event Types.

In this example, we included three Events, so the default on the Results screen will include all three. If you want to look at the impacts for just one Event, click on Filters and search for the Event Name that you want to see.

Labor Income Events

August 12, 2020/0 Comments/in Basic Analysis, IMPLAN Users Guide, Support Site/by Joe Demski

INTRODUCTION

Labor Income Events are appropriate to model a change in labor payments which are isolated from Industry production. An example would be a wage increase for current employees. There won’t be any new production, but the workers will earn more.

IMPLAN will automatically deduct in-commuting income, payroll tax, personal tax, and savings from Labor Income Events. All payroll taxes stay in the location of the employment. That is, only commuters’ post-payroll-taxes-income is deducted. Household spending of income on imported goods and services will also be treated as leakage.

Event Type	Labor Income Events
Event Use	Analyzing a change in Labor Income separately from production
Event Specification ”WHO”	Employee Compensation or Proprietor Income
Event Value “WHAT”	Employee Compensation or Proprietor Income

LABOR INCOME EVENTS

IMPLAN can be accessed via app.IMPLAN.com. Once you are logged in, you will be directed to the IMPLAN dashboard. From the dashboard you can navigate to the Regions, Impacts, or Projects screen.

Once you have chosen your Region and named your new Project, you will be directed to the Impacts screen. From here, click on Add New Event to create a Labor Income Event. In this set of examples, 2018 Nevada data is utilized.

Labor Income represents all forms of Employment income, including Employee Compensation (wages, salaries, and benefits) and Proprietor Income. When using a Labor Income Event, there are two Specification options: Employee Compensation and Proprietor Income.

Employee Compensation is the total payroll cost of wage and salary employees to the employer. This includes wages and salaries, all benefits (e.g., health, retirement) and payroll taxes (both sides of social security, unemployment insurance taxes, etc.). It is also referred to as fully-loaded payroll.

Proprietor Income consists of payments received by self-employed individuals and unincorporated business owners. More specifically, it represents the current-production income of sole proprietorships, partnerships, and tax-exempt cooperatives. It excludes dividends, monetary interest received by nonfinancial business, and rental income received by persons not primarily engaged in the real estate business.

In this example, there will be an additional $1M in Employee Compensation and an additional $250K in Proprietor Income. The Industry or Industries in which employees are earning new income is irrelevant in this example because there is no change in production, just an increase in earnings by existing employees. One Event will be set up for each type of Labor Income.

Now that you have your Events, ensure that all are highlighted in teal by clicking on them individually or checking Select All Events at the top of the screen. Now the Events can be dragged into your Group on the right.

You will know when the Events have populated in the Group when the number in the upper right of the Group box equals the number of Events.

Now click Run in the bottom right of the Impacts Screen.

The first thing you will notice is that there are no Direct or Indirect Effects. Labor Income Events only affect household spending, so there will only be Induced Effects. Learn more in the article Explaining Event Types.

In this example, we included two Events, so the default on the Results screen will include both. If you want to look at the impacts for just one Event, click on Filters and search for the Event Name that you want to see.

Labor Income Events are often used as part of Analysis-by-Parts (ABP). ABP allows you to examine a specialized Industry or a firm that is not

reflected by an IMPLAN Industry due to differences in the structure of the

Leontief Production Function and/or Spending Pattern that cannot be edited via a single Industry Event. This type of analysis is typically used to split the stemming ripple effects of an Industry Impact into its individual impact components – budgetary Spending Pattern (Intermediate Inputs) and payroll.

Industry Events

August 12, 2020/0 Comments/in Basic Analysis, IMPLAN Users Guide, Support Site/by Joe Demski

INTRODUCTION

There are four Industry Event Types in IMPLAN: Output, Employment, Employee Compensation, and Proprietor Income. Each of them operates in the same manner. This article will walk you through an example of each type of Industry Event.

Event Type	Industry (Output, Employment, Employment Compensation, Proprietor Income)
Event Use	Analyzing a change in an Industry’s production
Event Specification ”WHO”	Industry 1-546 experiencing change in demand/production
Event Value “WHAT”	1 or more: Output Employment Employee Compensation Proprietor Income

INDUSTRY EVENTS

IMPLAN can be accessed via app.IMPLAN.com. Once you are logged in, you will be directed to the IMPLAN dashboard. From the dashboard you can navigate to the Regions, Impacts, or Projects screen.

Once you have chosen your Region and named your new Project, you will be directed to the Impacts screen. From here, click on Add New Event to create your first Industry Event. In this set of examples, 2018 Nevada data is utilized.

INDUSTRY OUTPUT

The first type of Event is Industry Output. In IMPLAN, Output represents the value of Industry production. For service Industries, Output equals sales. For manufacturing firms, Output equals sales +/- the change in inventory. For retailers and wholesalers, Output equals their gross margin or Marginal Revenue (not gross sales) and does not include the value of goods sold. By default, the Event Value of an Industry Output Event with a retail or wholesale Industry specified is interpreted as Total Revenue. Learn more about retail and wholesale margins in the article Retail and Wholesale: Industry Margins.

In this example using an Industry Output Event, we are told a cheese manufacturing firm will have $1M in new production. We will give our new Event a Title, select the Type as Industry Output, the Specification is 82 – Cheese manufacturing, and the Value is $1,000,000. Check out the article Picking an Industry for assistance in choosing the appropriate IMPLAN Industry.

Perhaps we are also told that this cheese company will pay $250,000 of that $1M in production in Employee Compensation. We can click on the menu button to enter additional information for Employment, Employee Compensation, and Proprietor Income.

Clicking on Close will collapse the Advanced Menu.

IMPLAN will always prioritize the Event Values in the following order:

Output
Employee Compensation
Proprietor Income
Employment

Therefore, if this Event had instead been entered as an Industry Employee Compensation Event with a Value of $250,000 and an Output Value of $1,000,000 entered in the Advanced Menu, the Event would still produce the same Impact Results.

INDUSTRY EMPLOYMENT

Sometimes, we are only given an Employment figure. In this example, we are told there will be 100 new employees in a new sawmill. We will give our new Event a Title, select Industry Employment as the Type, select Industry 267 – Sawmill, woodworking, and paper machinery as the Specification, and type the Value of 100.

INDUSTRY EMPLOYEE COMPENSATION

If Output is unknown, but you do know the Employee Compensation associated with a new project, an Industry Employee Compensation Event is appropriate. Employee Compensation is the total payroll cost of wage and salary employees to the employer. This includes wages and salaries, all benefits and payroll taxes. It is also referred to as fully-loaded payroll.

In this example, we are told there will be $5M in new Employee Compensation at a crane manufacturing facility. We will give our new Event a Title, select Industry Employee Compensation as the Type, select Industry 289 – Overhead cranes, hoists, and monorail systems manufacturing as the Specification, and enter $5,000,000 as the Value. If you know more information, utilize the Advanced Menu to add in other known Values.

INDUSTRY PROPRIETOR INCOME

The final type of Industry Event is Industry Proprietor Income. Proprietor Income consists of payments received by self-employed individuals and unincorporated business owners. More specifically, it represents the current-production income of sole proprietorships, partnerships, and tax-exempt cooperatives.

In this example, we are told there will be $2M in new Proprietor Income at a packaging machinery manufacturing plant. We will give our new Event a Title, select Industry Proprietor Income as the Type, select Industry 293 – Packaging machinery manufacturing as the Specification, and enter the Value of $2,000,000. If you know more information, utilize the Advanced Menu to add in other known Values.

Now that you have your Events, ensure that all are highlighted in teal by clicking on them individually or checking Select All Events at the top of the screen. Now the Events can be dragged into your Group on the right.

You will know when the Events have populated in the Group when the number in the upper right of the Group box equals the number of Events.

Now click Run in the bottom right of the Impacts Screen.

When the analysis is finished, you are ready to check out your Results. For more information on how to interpret them, check out the article Industry Impacts: Direct, Indirect, and Induced Effects.

In this example, we included four Events, so the default on the Results screen will include all four. If you want to look at the impacts for just one Event, click on Filters and search for the Event Name that you want to see.

Industry vs. Commodity Output

February 27, 2020/0 Comments/in Basic Analysis, IMPLAN Users Guide, Support Site/by Joe Demski

INTRODUCTION:
Whether you are analyzing a capital investment, an Industry’s bill of goods, results of a visitor survey, or some other collection of spending data the question often arises, should I analyze this purchase as an Industry Output Event or a Commodity Output Event? Should the analysis be framed from the perspective of the product or the producer?

Because there are several considerations when making this selection appropriately this article is designed to assist you in making a well informed choice.

IDENTIFYING THE PURCHASE SCENARIO:
The questionnaire and table below outlines all of the potential possibilities when analyzing a purchase. For example, if you know there is a purchase from a local manufacturer, you can simply use an Industry Output Event and specify the appropriate manufacturing Industry. We start with where the item was purchased. By following the outline below, you can find the correct corresponding Event Type & Event settings numbered in the table.

If you do not have enough information to categorize your purchase into one of the scenarios below, the purchase should be omitted from your analysis. Without the necessary information to define the purchase as an Event, IMPLAN has no way of estimating how the purchase affects the Region you’ve selected. In the case of specifically capital purchases, there are a couple other options to consider here.

FROM WHOM WAS THE PURCHASE MADE:
A. Manufacturer
B. Local retailer or wholesaler
C. Non-local retailer or wholesaler

A: Purchase made through manufacturer
Was the product produced locally?
Yes: move on to question A2
No: Purchase Scenario #7
Not sure: Purchase Scenario #5
Do you know what they bought or who they bought it from?
What they bought: Purchase Scenario #3
Who they bought it from: Purchase Scenario #1
Note: Making this choice is most relevant for consideration when the supply of the good or service may be distributed across multiple Industries or Institutions such as government and inventory, which differ by Region. Check the Market Share of a good or service in your Region.

B: Purchase made through local retailer or wholesaler
Do you know what they bought?
No: Purchase Scenario #2
Yes: move on to question B2
Was the product produced locally?
No: Purchase Scenario #2
Yes: Purchase Scenario #4
Not sure: Purchase Scenario #6

C: Purchase made through non-local retailer or wholesaler
Do you know what they bought:
No: Purchase Scenario #7
Yes: move on to question C2
Was the product produced locally:
No: Purchase Scenario #7
Not sure: Remove margins, calculate Producer Marginal Revenue then proceed to Purchase Scenario #5
Yes: Remove margins, calculate Producer Marginal Revenue then proceed to Purchase Scenario #3
PURCHASE SCENARIOS
#

Event Type

Event Specification

Event Value

Margins Selection

LPP Setting

1

Industry Output

Manufacturer

Price paid at place of purchase

N/A

2

Industry Output

Retailer or Wholesaler

Price paid at place of purchase

Total Revenue

N/A

3

Commodity Output

Product

Price paid at place of purchase

Marginal Revenue

LPP = 100%

4

Commodity Output

Product

Price paid at place of purchase

Total Revenue

LPP = 100%

5

Commodity Output

Product

Price paid at place of purchase

Marginal Revenue

LPP = “SAM” (Region’s Commodity RPC)

6

Commodity Output

Product

Price paid at place of purchase

Total Revenue

LPP = “SAM” (Region’s Commodity RPC)

7

The purchase cannot be analyzed as an Event in the Region

Learn more in the following articles where these purchase scenarios are further explained and exemplified:

Retail and Wholesale: Industry Margins
Retail and Wholesale: Commodity Margins
Analyzing Capital Investments
Manually Marginning Bill of Goods (see example 2 to understand how to manually margin a Commodity and find the Producers’ Marginal Revenue)
ABP Bill of Goods Using Commodity or Industry Events

Explaining Event Types

February 19, 2020/0 Comments/in Basic Analysis, IMPLAN Users Guide, Support Site/by Joe Demski

EVENT TYPE DESCRIPTIONS:

INDUSTRY EVENTS

Industry Events indicate that you know what Industry or Industries are experiencing the change in production and you are interested in targeting those specific Industries.

There are four different types of Industry Events:
- Industry Output
- Industry Employment
- Industry Employee Compensation
- Industry Proprietor Income
These four Industry Event Types represent each value that can be entered into a single Industry Event. Picking among the 4 types should be determined by which value you have available about the industry.
When more than 1 value is known, those additional values can be entered in the Advanced Menu.
Total vs Marginal Revenue selection is available for Retail and Wholesale Industries in the Advanced Menu, and will default to Total Revenue.

COMMODITY EVENTS

You would use if you knew there was a change in Commodity demand or production but didn’t know what Industry or Institution (e.g., government) would meet the demand. For example, you know there will be an increased need for nursing home-care in the Region because of an aging population, but you don’t know what the mix of private hospitals, nursing homes, and government hospitals will provide this need.

Local Purchase Percentage (LPP) will default to 100%. This can be adjusted via the Advanced Menu.
Total vs Marginal Revenue selection is available for Commodities that can be purchased via a wholesaler or retailer in the Advanced Menu, and will default to Total Revenue.

LABOR INCOME EVENTS

This Event type is appropriate if you’d like to model a change in labor payments isolated from Industry production- e.g. examining the impacts of a wage increase for current employees.

Total Labor Income should include all new labor payments in the Study Area-
New income for all workers in the region even if they don’t live there (local workers and in-commuters), including their –
i. Payroll tax
ii. Personal tax
iii. Savings

Note: the model will automatically deduct in-commuting income, payroll tax, personal tax, savings, and imported goods and services. All payroll taxes stay in the location of the employment. That is, only commuters’ post-payroll-taxes-income is deducted.

With a Labor Income Event, you can specify whether the income is earned by wage and salary employees or sole proprietors (or some combination of the two) but you cannot specify the specific household income categories receiving the income— after deductions, the remaining income is distributed across all household income groups according to the household column totals in the SAM. At this point the income is applied to the income group specific multipliers.

HOUSEHOLD INCOME EVENTS

This Event type is appropriate if you’d like to model changes in Household Income that are independent of production and payroll.

Total Income should include all new household income in the Study Area-
New income for all residents in the region, including their –
i. Personal tax
ii. Savings

Note: the model will automatically deduct personal tax, savings, and imported goods and services. The model assumes payroll tax and in-commuting income has been excluded from your total income entry. Benefits should be included as household income in your entry.

The leftover amount after deductions is then applied to the multipliers. In this case, you can specify the particular household income group(s) receiving the income.

SPENDING PATTERN EVENTS

Industry Spending Pattern Events are appropriate if you have the data required to build your own spending pattern based on what your specific Industry purchases. They are also useful when an Industry needs to be modified beyond the Event customization available in an Industry Event. This is highly useful for making an IMPLAN Industry more specific to your business/impact using Analysis-by-Parts.

INDUSTRY CONTRIBUTION ANALYSIS EVENTS

Industry Contribution Analysis is a method used to estimate the value of a Industry or group of Industries in a region, at their current levels of production, rather than estimating the value of a change. While the focus of the analysis still looks at backward linkages, the purpose of this analysis differs. When considering the Indirect and Induced Effects of an impact analysis, we are looking at how Industries in our Region will respond to a change in the key Industry or Industries being modeled in our Events. Industry Contribution Analysis shifts this framework to see what Industries and what level of production in these Industries is being supported by the current activity of the target Industry or Industries in the Region. Contribution Analysis is a unique method which affects a constraint upon the Model by removing feedback linkages or buy backs to the Industry being analyzed.

Find more information about Industry Contribution Analysis here to learn more and determine if an Industry Contribution Analysis Event is right for your study.

WHERE THE EVENT VALUE IS APPLIED:

DIRECT EFFECTS AND OMITTED DIRECT EFFECTS:

Picking an Industry

December 30, 2019/0 Comments/in Basic Analysis, IMPLAN Users Guide, Support Site/by Joe Demski

INTRODUCTION:
IMPLAN has 546 different Industries to choose from when running your economic impact. But how do you choose which one is right for your study? Here is the guide to everything you need to know about IMPLAN Industries!

IMPLAN INDUSTRIES:
IMPLAN Industries consist of 546 different codes and names. IMPLAN Industries can be grouped into the following categories:

1-19 are Agriculture
20-38 are Mining, Minerals, and Oil
39-49 are Utilities
50-62 are Construction
63-391 are Manufacturing
392-413 are Wholesale and Retail
414-421 Transport Related
422-525 Services
526-534 Government Enterprises
535-538 are Commodity-Only Sectors
539-546 captures payroll and employment for different types of government
Industries 1-534 are all private industries and government enterprises that have been aggregated by similarity in input purchasing patterns. While they are all comparable, each IMPLAN Industry has its own production function and spending patterns. Picking the right Industry is important. Running $1M through Industry 195 – Rubber and plastics hoses and belting manufacturing will yield different results than running that same $1M through Industry 196 – Other rubber product manufacturing.

BUT HOW DO I CHOOSE ONE?
If you are looking at oranges in Florida, Industry 4 – Fruit Farming is going to be the one. Often times, it is just that easy; use the list of 546 Industries and pick which one fits your analysis.

Sometimes selecting which IMPLAN Industry to use is a little trickier. What if you want to know what IMPLAN Industry to assign for a company that makes cash registers? A quick scan through the list of 546 Industries won’t help much. So IMPLAN Economists put together a bridge from NAICS Codes to IMPLAN Industries to help. Using this document, you can search the detailed NAICS Codes by keywords like “cash register.” Doing this leads you to NAICS 333318 – Other Commercial and Service Industry Machinery Manufacturing which corresponds to IMPLAN Industry 272 – Other commercial service industry machinery manufacturing. Using this method, you can also see what other things fall under this Industry. Industry 272 also includes vending machines and voting machines, for example.

Alternatively, you can search the NAICS website to find which 6-digit NAICS Code best fits your needs. Then, you can use the NAICS Codes to IMPLAN bridge to find the corresponding IMPLAN Industry.

NAICS CODES:
The industry classifications for all establishments covered by the economic census and surveys are based on the North American Industry Classification System (NAICS). NAICS Codes are a system by which all Industries are classified across Canada, Mexico, and the United States. They consist of Industries made up of firms with similar patterns. The IRS requires that businesses report their Principal Business Activity Code on their federal tax return. The IRS business activity codes are based on the NAICS and this is how the government has data based on these codes. NAICS is scheduled to be reviewed for potential revisions every 5 years so that the classification system can keep pace with the changing economy; the most recent revision was in 2017.

Industries in IMPLAN are all classified based on NAICS Codes, with two exceptions. Construction Industries are based on the Census Structure Type descriptions. Additionally, the Industries that start with an asterisk (IMPLAN Industries 535-546) are not based on NAICS because these Sectors do not make any purchases.

BEA INPUT-OUTPUT ACCOUNTS:
So if there are almost a thousand NAICS Codes, why are there only 546 IMPLAN Industries? Well, the answer lies with the Bureau of Economic Analysis’s Input-Output Accounts. The BEA’s benchmark Input-Output (I-O) accounts provide the most detailed information available on the structure of the U.S. economy and its industries. Benchmark I-O accounts are prepared at 5-year intervals and are based on detailed data from economic censuses conducted every 5 years by the Bureau of the Census; the most recent Industry and Commodity data is from 2012.

The BEA data contains details on 405 Industries. IMPLAN Economists augment this using input from industry experts. So you may notice a few places where the BEA data is less aggregated than the IMPLAN data.

The Basics of Framing Your Analysis

December 19, 2019/0 Comments/in Basic Analysis, IMPLAN Users Guide, Support Site/by Joe Demski

INTRODUCTION:
When starting an IMPLAN analysis, you should first frame an analysis by identifying the who, what, where, when, and why of the analysis. Each of the first four questions are heavily influenced by the why of your analysis.

Framing your analysis is key to ensuring that studies are, first, prepared properly, and second, created properly inside IMPLAN. Answering the following questions before entering your analysis into the IMPLAN tool is a great way to ensure you’ve thought through the framing of your analysis and have the information you need.

FIVE STEPS OF FRAMING:
Woman.png
WHO ARE THE ACTORS?
Which Industry, Industries, or Commodities are experiencing a change?

Buyers create a demand for products—this is a demand change.
Sellers respond to demand changes by increasing production (Output). So, the seller is our actor.

Paper.png
WHAT IS THE VALUE OF THE ECONOMIC CHANGE?
One or more factors may be known about the change in production or expenditures, including Output (production value), Employment, or Employee Compensation (wages and benefits).

Map.png
WHERE IS THE IMPACT OCCURRING? WHERE DO YOU WANT TO MEASURE THE EFFECT?
These are important considerations when determining a model region.
Where you want to see the results occurring should be influenced by your Why and the audience/stakeholders involved in achieving your end goal with the study. Defining a functional economy may also be valuable to consider. A functional economy encompasses the major labor and production shed of the impact or contribution being modeled, meaning the region captures the local supply chain and areas in which employees are living and spending their income.
Region levels in IMPLAN include:
ZIP Codes
Congressional Districts
Counties
States
US Total
These Regions can be building blocks for Combined Regions or they can be linked together via a Multi-Region Input-Output Analysis (MRIO).
Be aware of aggregation bias – which stems from the loss of detail that occurs when you combine regions together to form a blended larger region.
Consider MRIO which estimates the interregional linkages of trade and commuting effects

Calendar.png
WHEN IS THE IMPACT TAKING PLACE? IN WHAT DOLLAR YEAR ARE YOUR INPUTS?
The Data Year indicates the year of the economy the model is based on, so if you are using a 2017 Data Year, your Region Details, Multipliers etc. will be based on the 2017 economy for the Region. The Data Year should be set to the year of the economy that best represents when the event occurs.
Deflators are applied to input values to convert them into terms of the Data Year before applying the multipliers.
Does the impact occur over a full year, a partial year, or a series of years?
Accounting for inflation – keep in mind that if historical survey data is used, the year of the data source should be used as the Dollar Year.

Brain.png
WHY ARE YOU PERFORMING THIS ECONOMIC ANALYSIS?
It is always smart to consider ALL potential audiences for your study. Ultimately, doing so may help you recognize the level of detail in which your final report should describe your study. Think about your audience:

What are you trying to communicate?
What drives them?

INTRODUCTION

INSTITUTIONAL SPENDING PATTERN EVENTS

RELATED ARTICLES

INTRODUCTION

INDUSTRY CONTRIBUTION EVENTS

RELATED ARTICLES

INTRODUCTION

INDUSTRY SPENDING PATTERN EVENTS

RELATED ARTICLES

INTRODUCTION

HOUSEHOLD INCOME EVENTS

RELATED ARTICLES

INTRODUCTION

LABOR INCOME EVENTS

RELATED ARTICLES

INTRODUCTION

INDUSTRY EVENTS

INDUSTRY OUTPUT

INDUSTRY EMPLOYMENT

INDUSTRY EMPLOYEE COMPENSATION

INDUSTRY PROPRIETOR INCOME

RELATED ARTICLES

EVENT TYPE DESCRIPTIONS:

INDUSTRY EVENTS

COMMODITY EVENTS

LABOR INCOME EVENTS

HOUSEHOLD INCOME EVENTS

SPENDING PATTERN EVENTS

INDUSTRY CONTRIBUTION ANALYSIS EVENTS

WHERE THE EVENT VALUE IS APPLIED:

DIRECT EFFECTS AND OMITTED DIRECT EFFECTS:

IMPLAN

CONTACT

REFERENCE

NAVIGATION