|For Immediate Release||Contact|
|October 16, 1997||Chungchin Chen • 393-1715|
The Capital District Regional Planning Commission has purchased the latest RIMS II (Regional Input-Output Modeling System) Regional Multipliers for economic impact analysis from the U.S. Dept. of Commerce, Bureau of Economic Analysis. The RIMS II model provides five types of multipliers: final demand multipliers for output, for household earnings, and for employment; and direct-effect multipliers for household earnings and for employment. These multipliers measure the economic impact of a change in final demand, in household earnings, or in employment on the entire Capital District economy.
Given estimates of output to final demand (e.g., construction costs and total sales) for a specific project, the final demand multipliers will allow CDRPC to estimate the project's total economic impact on the four-county Region, the total change in Regional household earnings, and the total change in Regional employment, as well as individual changes in output, household earnings, and employment for each of 38 industry aggregates. The total Regional impact of any project will include, besides direct project expenditures and employment, the impact on secondary, tertiary, and other industries such as transportation; communications; publishing; wholesale trade; finance, insurance, and real estate; medical and business services, etc. Using estimates of earnings (i.e., payroll) and employment for a project, the direct effect multipliers will allow CDRPC to estimate the project's total impact on Regional household earnings and employment.
The RIMS II multipliers highlight the advantages to the Region of additional skilled employment such as manufacturing over retail or service jobs. Each additional manufacturing job has a total average Regional economic impact of approx. $287,630, while an additional retail job has only about a $70,315 total impact and additional service sector jobs a $102,080 total impact on the Region's economy.
As an example, using the RIMS II multipliers to estimate the impact of the Region's 3,000-job decline in 1996 shows the total economic impact to have been about a $600 Million loss. Looking at specific industries, the 1,400-job decline in Manufacturing, resulting in about a $400 Million loss to the Region's economy, was NOT offset by the 1,600-job increase in the Trade and Services sectors, which resulted in only about a $170 Million gain to the Region's economy.
The Planning Commission is the federally-designated and funded planning organization for the Capital Region Economic Development District, which covers Albany, Rensselaer, Saratoga, and Schenectady counties. In this capacity, it perfoms a number of economic planning functions, such as maintenance of the Region's Overall Economic Development Program and economic impact estimation for local governments and private businesses throughout the Capital Region.
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