INTRODUCTION
For a Supplier Diversity or Supply Chain Analyst, the volume of corporate procurement data can be daunting. Large organizations move billions of dollars through their supply chains annually, resulting in thousands of transaction lines that typically sit in databases as static accounts payable records.
However, these transactions are more than just line items; they are a dynamic economic force. Once you look beyond the spreadsheet, that spend is a catalyst for community health, job creation, and household stability. The challenge lies in translation.
To move from detailed procurement data to an economic impact analysis, it helps to think of the three core components of any Input-Output (I-O) Analysis:
- The Event
- The Region
- The Timeframe
THE EVENT: DEFINING THE INDUSTRY AND ACTIVITY
In IMPLAN, the "Event" is the initial economic trigger—the actual spending that you are modeling. Mapping your procurement data to the correct Event requires:
- Aligning your vendors with the correct IMPLAN Industry
- Identifying the event input such as Total Output or Employment
PICKING AN IMPLAN INDUSTRY
In IMPLAN, production of goods and services is categorized using Industries, each with an IMPLAN code and description. Each Industry in IMPLAN has a unique production function that reflects the mix of inputs required for each Industry.
Picking an IMPLAN industry is always one of the first steps of analysis. Internal procurement data likely uses NAICS (North American Industry Classification System) codes, which bridge to IMPLAN’s sector scheme. IMPLAN offers a number of tools to help with this step.
NAICS QUICK AGGREGATIONS
If you want to continue to use your NAICS codes, IMPLAN offers two quick NAICS code aggregations (2-digit or 3-digit NAICS). These aggregations allow you to specify your industry directly in 2 or 3-digit NAICS codes, rather than IMPLAN codes.
While this does not allow you to work directly with 6-digit NAICs codes, this is a good option if you are able to roll your data up to the 2 or 3-digit NAICS codes.
More information on using these aggregations can be found in our article, Industry Aggregations.
NAICS To IMPLAN Industry Search
IMPLAN offers an in-app automated NAICS lookup tool within any of the Industry specified Event Types. When working on the Impacts screen, after selecting one of the Industry specified Event Types, the NAICS button will appear next to the Specification field. Clicking on this will open up the NAICS to IMPLAN Industry Search.
While this option is useful when you’re working in the application on small projects with a few events, it won’t be the most efficient tool for mapping across large datasets. For large projects we recommend using the Event Template, which we will discuss in more detail in a later section.
Bridge File
The NAICS Bridge File allows you to map 6-Digit NAICS codes to IMPLAN Industries using a downloaded Excel file.
Event Template
For large scale procurement data, the Event Template will be the most efficient tool for mapping NAICS codes to IMPLAN industries. This tool automates the NAICS to Bridge mapping. It allows you to continue to use your 6-digit NAICS code for sector identification and automatically provides the corresponding IMPLAN industry.
Note: The Event Template provides many advantages beyond Industry Mapping and can be useful for all stages of modeling procurement data. This is another reason for making it your starting point.
While most mappings are straightforward, there are a few technical nuances to keep in mind:
- The Construction Exception: Construction-related NAICS codes are based on specific components (e.g., plumbing) rather than the type of structure, making them a principal exception to direct mapping. IMPLAN Industries for construction are based on the type of building.
- Missing NAICS Codes: In addition to Construction, there are a few other special circumstance industries. Our article, Mind the Gaps: Navigating IMPLAN-NAICS, provides a comprehensive overview of these.
IDENTIFYING EVENT INPUTS
When mapping your procurement data to an IMPLAN Event, once you have picked the Industry, you must decide which Value to input. This is the step where you translate your internal transaction records into the specific economic metric that will "fuel" the model.
In most procurement datasets, you have access to at least one of three primary data points that can serve as an Event input:
- Spend (Output),
- Headcount (Employment), or
- Payroll (Employee Compensation).
| Input Type | Best Use Case | The Logic |
|---|---|---|
| Total Output (Spend) | The industry standard for Supplier Diversity reporting. Use this when you have high-fidelity transaction records but do not know the vendor’s specific staffing levels. |
IMPLAN estimates how many jobs and how much in wages that dollar amount supports. Note: For retail or wholesale purchases, ensure "Margining" is enabled. |
| Employment (Headcount) | Ideal for service-heavy contracts (e.g., janitorial, onsite staffing) where the number of "Direct Jobs" is known. | Inputting a job count allows the model to estimate the corresponding Output and Wages based on the industry’s average productivity per worker. |
| Employee Compensation (Payroll) | Use this when a contract is explicitly structured around labor costs. This should be a fully-loaded payroll figure. | Allows the model to estimate output and employee headcount using industry averages. |
Once your Event Inputs are defined, the next stage is choosing the Region, the geographic pillar that ensures those jobs and wages are credited to the correct local economy.
THE REGION: LOCALIZING THE SPEND
To produce a high-fidelity report, like the state-level tables found in major corporate briefs, you must define the geographic Region where the economic activity actually occurs.
- The Headquarters Bias: Corporate datasets often default to a vendor’s headquarters or billing address.
- The Technical Risk: Evaluating all impact at the HQ may overestimate the impact in one state while underestimating it in others where the work was actually performed, especially if some of that work is out of the country you are analyzing.
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Localized Mapping: If possible, map spend to the specific location of the operation (e.g., the branch or site office) rather than just the corporate HQ to ensure your regional job and tax reports are defensible.
THE TIMEFRAME: ALIGNING WITH THE ECONOMIC CLIMATE
The final component of your mapping process is the time frame. In economic modeling, time is not just a date on a calendar; it dictates the underlying mathematical relationships between industries, such as how much labor is required to produce a specific amount of output.
When preparing your procurement files, you likely have a "Spend Year" (the period during which the transactions actually occurred). In IMPLAN, to accurately reflect this, there are two IMPLAN inputs to set:
- Data Year
- Dollar Year
The Data Year
The Data Year tells IMPLAN which set of economic multipliers to use. It represents the "snapshot" of the economy — including employment levels, trade patterns, and industry production functions — for a specific year.
- Why it matters: The way a business operated in 2019 is technically different from how it operated in 2023, as is the overall economy it operates in. Matching your procurement year to the IMPLAN Data Year (e.g., using 2023 spend with 2023 Data) ensures that the estimated jobs and wages reflect the actual productivity and labor costs of that era.
- How to pick: Always use the most recent Data Year available that aligns with the year of your spend to capture the most accurate "ripple" through the current economy.
The Dollar Year
The Dollar Year (or "Event Year") tells IMPLAN the value of the currency you are inputting. Changing the Dollar Year tells IMPLAN to inflate or deflate the entered values.
- Why it matters: A $1 million contract in 2020 purchased a different volume of goods and services than a $1 million contract in 2026 due to inflation. If the Dollar Year is not set correctly, the model may overstate or understate the actual volume of economic activity triggered by your spend.
- How to pick: When entering your spend into an Event, set the Dollar Year to match the year the money was actually spent. For multi-year contracts, properly setting the Dollar Year for each year of spend allows IMPLAN to use internal Deflators to adjust those values into "constant dollars," ensuring inflation doesn't mask the true underlying economic activity.
| Feature | Data Year | Dollar Year |
|---|---|---|
| Defines | The structure of the economy (Multipliers). | The purchasing power of the currency (Inflation). |
| Controls | Jobs-per-dollar, the production function, and B2B trade patterns. | Price adjustments and "Deflators". |
| Typical Setting | The year the spend occurred (e.g., 2023). | The year the spend occurred (e.g., 2023). |
CONCLUSION
The process of mapping procurement data for supplier economic impact analysis requires translating from corporate language and metrics to IMPLAN inputs. Grounding procurement data in the three impact analysis pillars of The Event, The Region, and The Timeframe, is a good starting point.
This workflow ensures that every dollar of diverse spend is:
- Assigned the correct industry logic
- Localized to the specific community where work is performed
- Adjusted for the appropriate economic climate
When executed correctly, this mapping creates a defensible foundation for measuring the real-world impacts of supply chain activity on regional economies.
RELATED ARTICLES
Which Year Is It Anyway? Data Year, Model Year, and Dollar Year
Preparing and Entering: Region and Data Year
Preparing and Entering: Event Value
Written May 18, 2026