I-RIMS - negative earnings multiplier

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    IMPLAN Support
    Hello Matthew, Would you be able to send us the files that you have and note which employment and earnings multipliers you are using (i.e. which column and rows). In general, a Type 1 earnings multiplier could be negative if an industry or combination of industries has sufficiently negative proprietor income (one component of labor income; whereas employee compensation is always positive, business owners - proprietors - can lose money). Nevertheless, that does seem surprisingly low so we would like to investigate it in more detail. You can either attach the files to the Support Forum via an additional response, or email them to implangroup@implan.com with the subject line: Support Forum 19103 Thank you.
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    SpringStark
    File is attached. From the Total Multipliers tab, I'm looking at Final Demand Earnings (column 5) for Motor vehicle, body, trailer, and parts manufacturing (row 15). I'm also attaching the Type SAM file, for comparison. You'll see that it's similarly very negative. I'll be curious as to what you can uncover. At this point, I'm kind of fascinated on an academic level, apart from the job at hand. Thanks again. --Matt
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    IMPLAN Support
    Negative multipliers can happen. Labor Income = Employee Compensation + Proprietor Income so a negative Direct Labor Income multiplier is possible if a negative Proprietor Income is greater in magnitude than the positive Employee Compensation. Similarly with negative Induced Multipliers - if the negative Proprietor Income outweighs the positive Employee Compensation, then household spending (which drives the induced effect) will be negative (i.e., households will spend less). While these cases reflect the true state of the sector during the data year, they yield unexpected results when running impacts. If you were using the IMPLAN software, we would advise you in this case to edit the study area data to reflect the PI of your firm/project or to set PI = $0 or use a ratio (e.g., PI per employee) from the most comparable industry if you didn't know PI. However, since I-RIMS multiplier reports cannot be edited like that. the best to do is use an average multiplier from a few years. We have only been producing I-RIMS multipliers for 2 data years (2011 and 2012), with 2013 forthcoming in December. Do you have both years for this region? Was it a custom region created by us?
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    SpringStark
    I have just the one file so far. It was not custom-built; it's just the Kansas City MSA. Thanks for the feedback, by the way. It's nice to have an explanation apart from "I'm losing my mind."
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