Overview
In contrast with Case Study 10, we now examine the role a public community college plays in the economy of the same region: Washington County, MN. The general problem is similar to Case Study 10 as is the analytical approach. We identify three sub-problems or analysis units college operations, construction (capital investment) projects, and student spending. The particulars, however, include some important differences from Case Study 10.
Framing the Problem : Breaking the Analysis into Appropriate Units
Public colleges can contribute to local economic activity via different pathways, each of which can be evaluated separately for a robust economic impact study that best captures all the effects.
In this case study, we first need to determine which sector to use to represent the public community college. In Case Study 10, we used Industry 473 to analyze the private college. For this case study, however, we need a sector that represents the activity of public schools. All public education, including K-12 through college, are captured in the Institution for State/Local Government Education.
In this analysis, we will break the potential impacts of the college on the local economy into sub-components that allow us to better define and describe the college's affects on our community. We will see how our impacts will differ in the following use cases:
- The impacts of the total operating budget of a public college.
- The effects of the college on our local community when operations are known and new construction is occurring at the college. Keeping these impacts separated is useful because impacts from construction expenditures last only as long as the activity takes place, whereas annual operating expenditures continue on a recurring basis.
- Distinguishing the impacts of the faculty payroll from the staff payroll at the college.
- Examining student spending (i.e. personal consumption expenditures for snacks, auto fuel, or sporting goods) and general public spending for special events like concerts, theater, and inter-collegiate sports.
Case-11A
Impacts of a Public Community College when Only the Total Budget is Known
Objectives
Analyze the impact of the operation of a public college when all that is known is the total operations budget. Show impacts on Washington County employment, labor income, and GDP.
11A: Framing the Problem
The distinction between private and public colleges is important when using IMPLAN. Private colleges are included in Industry 473, Private junior colleges, colleges, universities, and professional schools while public colleges are government-run operations included in Institution for State and Local Government, Education. This distinction is the result of two factors: 1) differing input cost functions for private versus public colleges and 2) government expenditures which are typically part of Final Demand versus private sector expenditures which are typically part of Intermediate Demand.
In this example, all we know is the total operating budget of $100,000,000 in 2017. Below is a breakdown of our problem.
| Table 11a-1: Problem Frame for Impacts of a Public College | |
|
Case Study Problem |
Impacts of Stillwater Community College on the economy of Washington County, MN |
|
Sector |
Institution: State and Local Government, Education |
|
Total Operating Budget |
$100,000,000 in 2017 |
|
Analysis Protocol |
Create an Activity (Institution Spending Pattern activity type) with a set of Events for State/Local Govt Education with expenditures of $100,000,000. Create a Scenario consisting of this single Activity and analyze using the Washington County, MN single region model. |
11A Tasks for CS-11A
| Tasks | Hints & Comments | |
|
1. |
Use the CS_11_WashCoMN07 model or create your own Washington County, MN model |
Create your own model using data for Washington County MN, 2007 or use the pre-built CS_11_WashCoMN07 model that already includes Activities and Scenarios for this case study. |
|
2. |
Create an Institution Spending Pattern Activity called CS11a - Act1 Total Budget with 223 Events for State/Local Govt Education by importing it from the Model |
Click Set Up Activities from the left menu. In the top menu, click Activity Options, then Import, and finally Institution Spending Pattern. In the popup window, select State/Local Govt Education and click Import to create a new Activity. All Events are created at the same time. Change the default Activity name by clicking on Edit Activity, then entering CS11a - Act1 Total Budget. Change the Activity Level to 100,000,000. Click Save. |
|
3. |
Create a new Scenario called CS11a Total Budget consisting of the single Activity CS11a - Act1 Total Budget |
From the Set Up Activities window, click Next at the lower right or click Analyze Scenarios in the menu at the far left. Click New and change the default name to CS11a Total Budget. Leave the Scenario Level at 1.00. Add the CS11a - Act1 Total Budget Activity to the Scenario by moving it from the Available Activities box to the Selected Activities box (double-click the Activity name or highlight the Activity and use the Select button). |
|
4. |
Calculate the impacts of Scenario CS11a Total Budget |
Be sure CS11a Total Budget is the current Scenario (in the Scenario Name: field in the menu bar at the top of the window). Click Analyze Single Region to calculate the impacts. |
|
5. |
Review the impact results for Scenario CS11a Total Budget |
Respond with Yes to the popup message Analysis complete. Do you want to view the impact results? or click Scenario Results in the menu at the far left. |
|
6. |
Summarize the total impacts of the Scenario |
The Total Impact Summary is a convenient view. Hint: Gross Regional Product calculated from the income side is the same as Total Value Added. See Solutions below. |
|
7. |
Summarize the impacts on the top 5 affected Industries |
The Top Ten Industries Affected is a convenient view. See Solutions below. |
|
8. |
Find the following for Stillwater Community College: The total jobs:___ The total payroll:___ The average wage:___ Why do we examine Industry 438 for direct employment effects of public schools? |
In the Scenario Results window, select the Detailed Results tab and then:
Employment and payroll for the public sector is held in Industries 437-440. These sectors are essentially artificial industries whose only purpose is provide labor services by government employees for government operations. The State/Local Govt Education institution "purchases" labor from Industry 438. |
|
9. |
Extra Credit: Rank in order the total impacts on Employee Compensation by Industry from highest to lowest. What is the rank of Industry 357 Insurance Carriers? |
In the Scenario Results window, select the Detailed Results tab then View By: Employee Compensation. Click on the header for the Total column until the data is sorted in descending order. Industry 357 Insurance Carriers ranks 5th highest in Employee Compensation impacts. Another solution would be to select the Detailed Results tab then View By: Employee Compensation and then click Export: Selected Report to Excel. Open the spreadsheet with Microsoft Excel and sort the data. |
11A Solutions
- Task 3. Activities for Scenario CS11a Total Budget
- Task 6. Detail Impacts of Scenario CS11a Total Budget
- Task 7: Top 10 Industries impacted by Scenario CS11a Total Budget
Case 11B, Impacts of a Public Community College: Separating Operations from Construction
Objectives
Analyze separately the impacts of operating a public community college from the impacts of the college's facility construction program.
11B Framing the Problem
In this session, we will look at the differential impacts of the operating and construction budgets of a publicly-funded college. Unlike the previous CS-11a where all we knew was the total annual budget of $100,000,000, we will in this case presume that $75,000,000 of the budget is for operations while $25,000,000 is for construction. The distinction between operations and construction is important because operations spending is recurring annually while construction spending continues only for the duration of the project (assumed in this case to be one year). This means that we will use two sectors, State and Local Government, Education and Industry 34, Construction of new nonresidential commercial and health care structures. Table 11b-1 summarizes the problem frame and Table 11b-2 summarizes the settings for User Preferences for this example.
| Table 11b-1: Problem Frame for Impacts of the Operating and Construction Budgets of a Public College | |
|
Case Study Problem |
Calculate the separate impacts of the operating and construction budgets for Stillwater Community College on the economy of Washington County, MN. |
|
Sectors |
State and Local Government, Education Industry 34, Construction of new nonresidential commercial and health care structures |
|
Total Operating Budget |
Construction budget: $25,000,000 in 2007 Operating budget:: $75,000,000 in 2007 |
|
Analysis Protocol |
Create two Activities. The first Activity (Institution Spending Pattern activity type) includes a set of Events for State/Local Government Education with expenditures of $75,000,000. The second Activity (Industry Change activity type) includes a single Event for Industry 34 with Industry Sales of $25,000,000. Create two Scenarios each consisting of one of these two Activities and analyze using the Washington County, MN single region model. |
|
Resources Used |
Washington County, MN model built using 2007 data using the default Trade Flow estimation method. |
|
Desired Outcome |
To summarize the separate impacts from spending the operations and construction budgets of Stillwater College on the Washington County economy in terms of total Direct, Indirect, and Induced effects on Output, Gross Regional Product, Employment, and Labor Income. Describe the five sectors with the highest impacts in terms of Employment and GRP, and examine the Employment and payroll levels of the college itself. |
| Table 11b-2: User Preferences Settings | |
|
Default Event Year: 2007 |
User Preferences, Analysis tab |
|
Basic Modeling: Checked |
User Preferences, Analysis tab |
11B Tasks for CS-11B Part 1
| Tasks | Hints & Comments | |
|
1. |
Continue using the model from the previous tasks. |
|
|
2. |
Create an Institution Spending Pattern Activity called CS11b - Act1 Operating Budget with 223 Events for State/Local Govt Education |
Click Set Up Activities from the left menu. In the top menu, click Activity Options, then Import, and finally Institution Spending Pattern. In the popup window, select State/Local Govt Education and click Import to create a new Activity. All Events are created at the same time. Change the default Activity name by clicking on Edit Activity, then entering CS11b - Act1 Operating Budget. Change the Activity Level to 75,000,000. Click Save. |
|
3. |
Create a new Scenario called CS11b Operating Budget consisting of the single Activity CS11b Act1 Operating Budget |
From the Set Up Activities window, click Next at the lower right or click Analyze Scenarios in the menu at the far left. Click New and change the default name to CS11b Operating Budget. Leave the Scenario Level at 1.00. Add the CS11b Act1 Operating Budget Activity to the Scenario by moving it from the Available Activities box to the Selected Activities box (double-click the Activity name or highlight the Activity and use the Select button). |
|
4. |
Calculate the impacts of Scenario CS11b Operating Budget |
Be sure CS11b Operating Budget is the current Scenario (in the Scenario Name: field in the menu bar at the top of the window). Click Analyze Single Region to calculate the impacts. |
|
5. |
Review the impact results for Scenario CS11b Operating Budget |
Respond with "Yes" to the popup message "Analysis complete. Do you want to view the impact results?" or click Scenario Results in the menu at the far left. |
|
6. |
Summarize the total impacts of Scenario CS11b Operating Budget |
The Total Impact Summary is a convenient view. Hint: Gross Regional Product calculated from the income side is the same as Total Value Added. See Solutions below. |
|
7. |
Summarize the impacts on the top 5 affected Industries for Scenario CS11b Operating Budget |
The Top Ten Industries Affected is a convenient view. See Solutions below. |
|
8. |
Find the following for Stillwater Community College: The total jobs:___
The total payroll:___
The average wage:___ |
In the Scenario Results window, select the Detailed Results tab and then:
|
11B Solutions Part
- Task 3. Activities for ScenarioCS11b Operating Budget
- Task 6. Detail Impacts of ScenarioCS11b Operating Budget
- Task 7: Top 10 Industries impacted by ScenarioCS11b Operating Budget
11B Tasks for CS-11B Part 2
| Tasks | Hints & Comments | |
|
9. |
Create an Industry Change Activity called CS11b Act2 Construction Budget with one Event for Industry 34 |
Click Set Up Activities from the left menu, then New to create a new Activity. Change the default name to CS11b Act2 Construction Budget and leave the Activity Level at 1.00. Similarly select New to create a new Event. |
|
10. |
Select Industry 34 for the Event |
Type 34, or use the drop-down menu to select 34, or right-click in the Sector field and and use Sector Search to search for education. The search will lead you to Educational buildings, new construction indicating sector 34 is the applicable industry. |
|
11. |
Enter $25,000,000 in the Industry Sales field |
$25,000,000 is the portion of the total budget of Stillwater Community College spent on constructing new buildings in 2007. |
|
12. |
Create a new Scenario called CS11b Construction Budget consisting of the single Activity CS11b Act2 Construction Budget |
From the Set Up Activities window, click Next at the lower right or click Analyze Scenarios in the menu at the far left. Click New and change the default name to CS11b Construction Budget. Leave the Scenario Level at 1.00. Add the CS11b Act2 Construction Budget Activity to the Scenario by moving it from the Available Activities box to the Selected Activities box (double-click the Activity name or highlight the Activity and use the Select button). |
|
13. |
Calculate the impacts of Scenario CS11b Construction Budget |
Be sure CS11b Construction Budget is the current Scenario (in the Scenario Name: field in the menu bar at the top of the window). Click Analyze Singe Region to calculate the impacts. |
|
14. |
Review the impact results for Scenario CS11b Construction Budget |
Respond with "Yes" to the popup message "Analysis complete. Do you want to view the impact results?" or click Scenario Results in the menu at the far left. |
|
15. |
Summarize the total impacts of Scenario CS11b Construction Budget |
The Total Impact Summary is a convenient view. Hint: Gross Regional Product calculated from the income side is the same as Total Value Added. See Solutions below. |
|
16. |
Summarize the impacts on the top 5 affected Industries for Scenario CS11b Construction Budget |
The Top Ten Industries Affected is a convenient view. See Solutions below. |
|
17. |
Find the following for Stillwater Community College:
The total construction jobs:___
The total construction payroll:___
The average construction wage:___ |
In the Scenario Results window, select Scenario CS11b Construction Budget, then select the Detailed Results tab and then:
|
|
18. |
Extra Credit: Order the total impacts of Scenario CS11b Construction Budget on Employee Compensation by Industry from highest to lowest. What is the rank of Industry 357 Insurance Carriers? |
In the Scenario Results window, select the Detailed Results tab then View By: Labor Income. Click on the header for the Total column until the data is sorted in descending order. Industry 357 Insurance Carriers ranks 8th highest in Labor Income impacts. Another solution would be to select the Detailed Results tab then View By: Labor Income and then click Export: Selected Report to Excel. Open the spreadsheet with Microsoft Excel and sort the data. |
11B Solutions Part 2
- Task 11. Activities for Scenario CS11b Construction Budget
- Task 15. Total Impacts of Scenario CS11b Construction Budget
- Task 16: Top 10 Industries impacted by Scenario CS11b Construction Budget
Case 11C Impacts of a Public Community College: Modifying Construction Employment and Payroll
Objectives
Re-evaluate the impacts from construction when the number of construction workers and their payroll is known.
11C Framing the Problem
In the previous Case Study 11b Task 17, we found that the direct employment and payroll impacts in Industry 34 from Stillwater Community College's $25,000,000 construction program in 2007 were 204 jobs and $9,951,777 respectively. Suppose that after examining the draft report, the college facilities manager tells us that although our payroll estimate was reasonable, there were in fact 225 construction workers on the project. Additionally, the construction project had been contracted to a single construction firm and all workers were employees of the firm (i.e., they did not sub-contract to independent contractors). Re-evaluate the impacts of the construction portion of the budget using Event Options to reflect this new information.
Note: This exercise is identical to Cast Study 10c. Whether construction activity is sold to the private sector or public sector makes no difference in impact analysis protocol or consequences.
| Table 11c-1: Problem Frame for Impacts of the Construction Budget of a Public College when Construction Employment and Payroll are Known | |
|
Case Study Problem |
Calculate the impacts of the construction budget for Stillwater Community College (a public college) on the economy of Washington County, MN. The facilities manager has told us that there are 225 construction jobs with a payroll of $9,951,777. |
|
Sector |
Industry 34, Construction of new nonresidential commercial and health care structures |
|
Total Construction Budget |
Construction budget: $25,000,000 in 2007 |
|
Analysis Protocol |
Create an Activity (Industry Change activity type) with a single Event for Industry 34 with Industry Sales of $25,000,000. Customize the Employment, Employee Compensation, and Proprietor Income fields. Create a single Scenario consisting of the Activity and analyze using the Washington County, MN single region model. |
|
Resources Used |
Washington County, MN model built using 2007 data using the default Trade Flow estimation method |
|
Desired Outcome |
To have the direct construction jobs and payroll impacts agree with the facility manager's project information. |
| Table 11c-2: User Preferences Settings | |
|
Default Event Year: 2007 |
User Preferences, Analysis tab |
|
Basic Modeling: Checked |
User Preferences, Analysis tab |
|
Event Options |
Event Options > Show > Employment Event Options > Show > Labor Income |
11C Tasks for CS-11C
| Tasks | Hints & Comments | |
|
1. |
Continue using the model from the previous tasks. |
|
|
2. |
Create an Industry Change Activity called CS11c Act1 Mod Const Budget with one Event for Industry 34 |
Click Set Up Activities from the left menu, then New to create a new Activity Change the default name to CS11c Act1 Mod Const Budget and leave the Activity Level at 1.00. Similarly, select New to create a new Event. |
|
3. |
Select Industry 34 for the Event |
Type 34, or use the drop down menu to select 34, or right-click in the Sector field and and use Sector Search to search for education. The search will lead you to Educational buildings, new construction - indicating sector 34 is the applicable industry. |
|
4. |
Change the Event Options to show Employment and Labor Income for the Event. |
Click Event Options > Show > Employment and Event Options > Show > Labor Income. Fields showing these parameters for the Event will appear to the right of the Event's Industry Sales field. |
|
5. |
Enter $25,000,000 in the Industry Sales field |
$25,000,000 is the portion of the total budget for construction for Stillwater Community College in 2007. Note that when you enter $25,000,000 in the Industry Sales field, 204 appears in the Employment field, $8,086,641 in the Employee Compensation field, and $1,865,137 in the Proprietors Income field. |
|
6. |
Change Employment to 225, Employee Compensation to $9,951,778 and Proprietors Income to $0 to agree with the facility manager's information. Leave the Industry Sales at $25,000,000. |
Enter 225 in the Employment field. Respond with "Yes" to the message box question "Do you want to set this Event to Custom?" Enter values for Employee Compensation and Proprietor Income in similar fashion. Note that Industry Sales of $25,000,000 does not change. Employee Compensation is set to $9,951,778 (the sum of $8,086,641 plus $1,865,137) because the entire payroll is being paid to the construction firm's employees. Proprietor Income is set to zero because we are assuming there are no independent sub-contractors. |
|
7. |
Create a new Scenario called CS11c Mod Const Budget consisting of the single Activity CS11c Act1 Mod Const Budget |
From the Setup Activities window, click Next at the lower right or click Analyze Scenarios in the menu at the far left. Click New and change the default name to CS11c Mod Const Budget. Leave the Scenario Level at 1.00. Add the CS11c Act1 Mod Const Budget Activity to the Scenario by moving it from the Available Activities box to the Selected Activities box (double-click the Activity name or highlight the Activity and use the Select button). |
|
8. |
Calculate the impacts of Scenario CS11c Mod Const Budget |
Be sure CS11c Mod Const Budget is the current Scenario (in the Scenario Name: field in the menu bar at the top of the window). Click Analyze Singe Region to calculate the impacts. |
|
9. |
Review the impact results for Scenario CS11c Mod Const Budget |
Respond with "Yes" to the popup message "Analysis complete. Do you want to view the impact results?" or click Scenario Results in the menu at the far left. |
|
10. |
Summarize the total impacts of Scenario CS11c Mod Const Budget |
The Total Impact Summary is a convenient view. Hint: Gross Regional Product calculated from the income side is the same as Total Value Added. See Solutions below. |
|
11. |
Summarize the impacts on the top 5 affected Industries for Scenario CS11c Mod Const Budget |
The Total Impact Summary is a convenient view. See Solutions below. |
|
12. |
Find the following for Stillwater Community College:
The total construction jobs:____
The total construction payroll:____
The average construction wage:____ |
In the Scenario Results window, select ScenarioCS11c Mod Const Budget, then select the Detailed Results tab and then:
|
|
13. |
Compared to the previous CS11b, total construction payroll did not change but the number of construction workers increased from 204 to 225, yet the average wage per construction worker went up from $39,640 to $44,230. Why? |
See Solutions below. |
|
14. |
Compare the results of this Case Study with the impacts for the construction budget in the previous CS11b. How are they different? |
See Solutions below. |
11C Solution
- Task 6. Activities for Scenario CS11c Mod Const Budget
- Task 10. Total Impacts of Scenario CS11c Mod Const Budget
- Task 11: Top 10 Industries impacted by Scenario CS11c Mod Const Budget
- Task 13: In CS11b we used only a portion of the total construction payroll to compute the average wage. The portion was Employee Compensation (the part of the payroll paid to employees of the construction firm). Proprietor Income was not included in the computation. In this case study we assume that all 225 workers are employed by the construction firm and that all payments to labor are made to employees and not to independent sub-contractors. Hence, we added what had been Proprietor Income to Employee Compensation and zeroed out Proprietors Income. $44,230 is the average wage after these adjustments.
- Task 14: Compare the Total Impact Results for CS11b, Task 18 with the Total Impact Results for CS11c, Task 10 above. Other than the Employment impact having 21 more jobs (because of the increase in construction jobs from 204 to 225), there are only relatively minor differences. In fact aside from the change in construction jobs, the Direct and Indirect effects are virtually identical between the two Case Studies. CS11c has slightly lower Induced effects compared to the Induced effects of CS11b. This is due to differences in how Employee Compensation and Proprietor Income are disbursed among Households.
Case 11D, Impacts of a Public Community College: Separating Faculty and Staff Payroll Effects
Objectives
Re-evaluate the impacts from operating Stillwater Community College to distinguish the impacts of Faculty payroll from Staff payroll.
11D Framing the Problem
In CS11b Task 8, we found that the employment and payroll impacts from Stillwater Community College's $75,000,000 operating budget in 2007 were 1,062 jobs and $55,723,064 respectively. Suppose that after examining the draft report, the college administrator tells us that although our total payroll estimate was reasonable, there were in fact 362 faculty members and 700 staff workers at the college. Additionally, the payroll itself was split roughly 50/50 between faculty and staff. Re-evaluate the impacts of the operations portion of the budget using Event Options to reflect this new information.
Note: This protocol is not identical to Case Study 10d.
|
Table 11d-1: Problem Frame for Impacts of the Operating Budget of a Public College to Separate Faculty Payroll Impacts from Staff Payroll Impacts |
|
|
Item |
Comments |
|
Case Study Problem |
Calculate the impacts of the operating budget for Stillwater Community College (a public college) on the economy of Washington County, MN. The College administrator has told us that there are 314 faculty and 700 staff jobs and the total payroll of is split 50/50 between them. |
|
Sectors |
State and Local Government, Education Industry 438, Employment and payroll for SL Government Education |
|
Total Operating Budget |
Operating budget: $75,000,000 in 2007 |
|
Analysis Protocol |
This protocol will use a single Scenario consisting of three Activities. Create three Activities. The first Activity is an Institution Spending Pattern for State and Local Government, Education with the Activity Level set to $75,000,000 and the last event (sector 438) deleted. The second Activity is an Industry Change for Industry 438 with an output of $26,839,796. Employment and Employee Compensation are customized to represent Staff jobs and payroll. The third Activity is an Industry Change for Industry 438 with an output of $26,839,796. Employment and Employee Compensation are customized to represent Faculty jobs and payroll. Create one Scenario consisting of all three Activities and analyze using the Washington County, MN single region model. |
|
Resources Used |
Washington County, MN model built using 2007 data using the default Trade Flow estimation method |
|
Desired Outcome |
To have the Direct Faculty and Staff jobs and payroll impacts agree with the College administrator's information. |
|
Table 11d-2: User Preferences Settings |
|
|
Default Event Year: 2007 |
User Preferences, Analysis tab |
|
Basic Modeling: Checked |
User Preferences, Analysis tab |
|
Use Event Options |
Event Options > Show > Employment Event Options > Show > Labor Income |
11D Tasks for Case Study Exercise 11D
|
Tasks |
Hints & Comments |
|
|
1. |
Continue using the model from the previous tasks. |
|
|
2. |
Create an Institution Spending Pattern Activity called CS11d Act1 Ops Budget No Jobs with 223 Events for State/Local Government Education |
Click Set Up Activities from the left menu. In the top menu, click Activity Options, then Import, and finally Institution Spending Pattern. In the popup window, select State/Local Govt Education and click Import to create a new Activity. All Events are created at the same time. Change the default Activity name by clicking on Edit Activity, then entering CS11d - Act1 Ops Budget No Jobs. Change the Activity Level to 75,000,000. Click Save. |
|
3. |
Delete Event 3438. |
Scroll to the last Event, Sector 3438, Employment and payroll only (state & local government, education). Click Delete Event. As discussed in CS 11a Task 8, this sector provides all government labor to the S/L Government Institution. By deleting this event, we leave only the commodity inputs required by the public education institution. This configuration means that the Event will generate only direct and indirect impacts for the budget but no induced impacts from college Faculty or Staff. Induced impacts from workers in other sectors will occur and appear in the results. The Faculty and Staff induced impacts will be estimated using two additional Activities. |
|
4. |
Create an Industry Change Activity called CS11d Act2 College Staff with one Event for Industry 438. |
|
|
5. |
Enter $27,861,562 in the Industry Sales field. Change Employment to 700, Employee Compensation to $27,861,562 and Proprietor Income to $0. |
Enter $26,839,796 in the Industry Sales field. Since the only output of this industry is government labor, output equals employment compensation. $26,839,796 is half of the $53,679,592 payroll. Enter 700 in the Employment field. Respond with "Yes" to the message box question "Do you want to set this Event to Custom?" Enter $26,839,796 in the Employee Compensation field to match industry output. Do not edit $0 in the Proprietor Income field. This configuration means that the Event will generate Induced impacts only from spending by college Staff. |
|
6. |
Create an Industry Change Activity called CS11d Act3 College Faculty with one Event for Industry 438. |
|
|
7. |
Enter $27,861,562 in the Industry Sales field. Change Employment to 314, Employee Compensation to $27,861,562 and Proprietors Income to $0. |
Enter $26,839,796 in the Industry Sales field. Since the only output of this industry is government labor, output equals employment compensation. $26,839,796 is half of the $53,679,592 payroll. Enter 314 in the Employment field. Respond with "Yes" to the message box question "Do you want to set this Event to Custom?" Enter $26,839,796 in the Employee Compensation field to match industry output. Do not edit $0 in the Proprietor Income field. This configuration means that the Event will generate only Induced impacts from spending by College Faculty. |
|
8. |
Create a new Scenario called CS11d Mod Ops Budget |
From the Setup Activities window, click Next at the lower right or click Analyze Scenarios in the menu at the far left. Click New and change the default name to CS11d Mod Ops Budget. Leave the Scenario Level at 1.00. Add the CS11d Act1 Ops Budget No Jobs , CS11d Act2 College Staff, and CS11d Act3 College Faculty Activities to the Scenario by moving them from the Available Activities box to the Selected Activities box (double-click the Activity name or highlight the Activity and use the Select button). |
|
9. |
Calculate the impacts of Scenario CS11d Mod Ops Budget |
Be sure CS11d Mod Ops Budget is the current Scenario (in the Scenario Name: field in the menu bar at the top of the window). Click Analyze Singe Region to calculate the impacts. |
|
10. |
Summarize the total impacts of Scenario CS11d Mod Ops Budget. |
The Total Impact Summary is a convenient view. See Solutions below. |
|
11. |
Find the following for Stillwater Community College:
The direct jobs:____
The direct payroll:____
The average direct wage:____
The total jobs generated in Washington County:____ |
In the Scenario Results window, select Scenario CS11d Mod Ops Budget. Select the Detailed Results tab and then:
Now find the total jobs generated in Washington County by Stillwater Community College operations.
|
11D Solutions
- Task 2. Activity CS11d Act1 Ops Budget No Jobs
- Task 4. Activity CS11d Act2 College Staff
- Task 6. Activity CS11d Act3 College Faculty
- Task 9. Results for ScenarioCS11d-Mod Ops Budget
- Task11. Detail results for Scenario CS11d-Mod Ops Budget
{/sliders-11d}
Case 11E, Impacts of a Public Community College: Student Spending
Objectives
Evaluate the impacts of Stillwater Community College student expenditures on non-college related goods and services.
11E Framing the Problem
Personal spending by students at Stillwater Community College on non-college goods and services (like snacks or gas for their cars) will also impact the local economy. To estimate these impacts, we will need to know how much they spend and which items they buy for personal use (that is, beyond tuition and books which are included in the college's operational budget). We will assume that a simple survey on student spending was conducted to provide the information shown in Table 11e-1. Our example here is simplified because we do not stratify students into different groups based on their spending behaviors. A more robust study would try to capture all spending while differentiating students by those who are residents of Washington County versus non-residents, those living with their parents versus in apartments, those with vehicles versus users of public transportation, etc. Such a study would be necessary to answer a variety of other questions beyond the simple objective given above.
Note: This case is similar to the last task in CS10e.
|
Table 11e-1: Problem Frame for Impacts of Student Spending |
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|
Item |
Comments |
||||||||||||||||||||||||
|
Case Study Problem |
Evaluate the impacts of Stillwater Community College student personal expenditures on non-college related goods and services. A survey revealed the following:
|
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|
Sector |
There is no "student spending" sector. Allocate spending for each item to the sector that produces it. Apply Margins for items purchased at retail outlets. |
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Analysis Protocol |
Create an Activity (Industry Change Activity Type for this case) and add five Events, one for each spending item. Use the Local Purchase Percentage (LPP) Event Option to indicate how much of each purchase is made in the Study Area. Use Margins Event Option for purchases made at retail outlets. Make the Event spending values represent $ spent per student per day in the Study Area and use the Scenario Level to represent the total student spending-days. |
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Resources Used |
Washington County, MN model built using 2007 data using the default Trade Flow estimation method. |
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Desired Outcome |
To estimate the employment and income impacts in Washington County, MN from student spending in the Study Area. |
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Table 11e-2: User Preferences Settings |
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Default Event Year: 2007 |
User Preferences, Analysis tab |
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Basic Modeling: Checked |
User Preferences, Analysis tab |
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Use Event Options |
Event Options > Show > LPP |
11E Tasks for Case Study Exercise 11E
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Tasks |
Hints & Comments |
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1. |
Use the CS_11_WashCoMN07 model |
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2. |
Create an Industry Change Activity called CS11e Act1 Student Spending with one Event for each of the items identified by the survey as being in each students market basket. |
Click Set Up Activities from the left menu, then New to create a new Activity. Change the default name to CS11e Act1 Student Spending and leave the Activity Level at 1.00. Similarly, select New to create each new Event. Why choose an Industry Change Activity rather than Commodity Change Activity? See Solutions below. |
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3. |
Create an Event for daily spending on soda pop by selecting Industry 70. Enter $2.00 in the Industry Sales field. |
Type 70, or use the drop-down menu to select 70, or right-click in the Sector field and and use Sector Search to search for soda pop. When industry 70 is selected, a warning pops up informing you that the industry does not exist in the model. Click OK. See Solutions below. |
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4. |
Students purchase soda pop at retail stores so Margins should be applied to these purchases. Use Event Options to apply Margins to this Event. |
Click Event Options > Edit Event Properties > Margins > Yes. If you would like to see how Margins are applied to this Event, click Event Options > Edit Event Properties > Margins > Edit Margins. A Margins field is not added to the event display. |
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5. |
Since all expenditures by students occur within the Study Area, be sure that the Local Purchase Percentage (LPP) is 100% |
Click Event Options > Show > Local Purchase Percentage to make the LPP visible. The LPP should be 100%. If not, Click Event Options > Edit Event Properties > Local Purchase Percentage > Set to 100% or click File > User Preferences > Analysis Tab > Default Event Local Purchase Coefficient > 100% Local. |
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6. |
Create an Event for daily spending on candy bars by selecting Industry 50, enter $1.50 in the Industry Sales field, apply Margins since they are bought in retail stores, and set LPP to 100%. |
Type 50, or use the drop-down menu to select 50, or right-click in the Sector field and and use Sector Search to search for "candy bar" (assume they are chocolate). |
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7. |
Create an Event for daily spending on parking by selecting Industry 422, enter $2.00 in the Industry Sales field and set LPP to 100%. |
Type 422, or use the drop-down menu to select 422, or right-click in the Sector field and and use Sector Search to search for parking (assume it is a private parking lot). There is no need for Margins since parking lots are not retail (that is, they produce the parking service themselves). |
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8. |
Create an Event for daily spending on auto fuel by selecting Industry 115, enter $3.50 in the Industry Sales field, apply Margins since gasoline is purchased at retail service stations, and set LPP to 100%. |
Type 115, or use the drop-down menu to select 115, or right-click in the Sector field and and use Sector Search to search for Gasoline (to find Gasoline made in petroleum refineries). |
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9. |
Create an Event for daily spending in restaurants by selecting Industry 413, enter $7.00 in the Industry Sales field and set LPP to 100%. |
Type 413, or use the drop-down menu to select 413, or right-click in the Sector field and and use Sector Search to search for restaurant. There is no need for Margins since restaurants are not retail (that is, they produce the meals themselves). At the bottom of the Manage Activites and Events window, the Number of Events in the Current Activity should equal 5 and Sum of Event Values should equal 16.00. |
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10. |
Create a new Scenario called CS11e Student Spending consisting of the Activity |
From the Setup Activities window, click Next at the lower right or click Analyze Scenarios in the menu at the far left. Click New and change the default name to CS11e Student Spending. Add Activity CS11e Act1 Student Spending to the Scenario by moving it from the Available Activities box to the Selected Activities box (double-click the Activity name or highlight the Activity and use the Select button). |
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11. |
Set the Scenario Level for Scenario x to 2,000,000 to indicate the number of student spending days |
10,000 students on campus for 200 days per year for a total of 10,000 x 200 = 2,000,000 student spending-days |
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12. |
Calculate the impacts of Scenario CS11e Student Spending |
Be sure CS11e Student Spending is the current Scenario (in the Scenario Name: field in the menu bar at the top of the window). Click Analyze Singe Region to calculate the impacts. |
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13. |
Summarize the total impacts of Scenario CS11e Student Spending. |
The Total Impact Summary is a convenient view. See Solutions below. |
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14. |
Review the Detailed Results of the Scenario's impacts on Output. Why are there Direct Output effects on Industries 324, 326, and 335, for example, since these were not specified in the Events? |
These are the result of applying Margins since we indicated that some of the items were purchased by students from retail stores. Margining allocates the sale of retail goods to all producing sectors involved. Besides the industry producing the good, wholesale, transportation, and retail sectors all contribute to satisfying consumer demand for retail products. |
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15. |
Suppose that a lack of price competition among service stations in Washington County causes students to buy gasoline outside of the study area. How does this affect the Scenario results? |
Create a new Activity called CS11e Act1 Student Spending LPP. This new Activity will be identical to CS11e Act1 Student Spending, except the LPP for the Event for Industry 115 will be set to 0%. By changing the LPP to 0%, no industries in the study area are involved in satisfying consumer demand for gasoline. Create a new Scenario CS11e Student Spending LPP, associate the new Activity with it, and analyze. See Solutions below. |
11E Solutions
- Task 2. Which should I choose: Commodity Change Activity or Industry Change Activity? The choice is largely a matter of an analyst's preference based upon understanding the differences between the two Activity types. In many ways, using a Commodity Change Activity is the most intuitive choice since in this case we know more about which commodities (e.g., soda pop, restaurant meals) are being purchased rather than the Industries from which they are being purchased. However, using a Commodity Change Activity does mean that the commodity demand must be allocated among Industries using the Market Shares matrix when more than one Industry produces a Commodity. This can cause an analyst consternation because the Direct Effects of the Scenario may show Industries being affected that were not specified in the Events. For example, if Commodity 3115 is used for gasoline (and is the primary Commodity produced by Industry 115), Industry 118 also shows a Direct Effect because it produces gasoline as minor byproduct. Likewise, Industries 429 and 432 (government enterprises) show Direct Effects due to demand for restaurant meals along with Industry 413. If your interpretation of the survey on student spending is that it describes both which Commodities students buy as well as the Industries from which they buy them (e.g., restaurant meals are purchased from Industry 413), then an Industry Change Activity would be appropriate. In this case, we assume that the survey gives us credible information regarding the industry from which students make their purchases.
- Task 3. When an industry is selected as an event and does not exist in the study area, a warning message pops up. The message simply informs you that the industry does not exist and offers two options for introducing and/or analyzing the industry. Since we are not concerned with introducing a new industry to the study area, no further action is required. Simply click OK to proceed.
- Tasks 3 through 9. Events.
- Task 13. Total Impacts of Scenario CS11e Student Spending
- Task 15. Total Impacts of Scenario CS11e Student Spending LPP modified for 0% of students buying gasoline at home.
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