A region's ability to fill jobs

Hi Donovan, You are certainly correct, the model is designed so that impacts run in the software will not change the underlying regional data. So you will not see the model make an estimate of how much of the Employment needs of the impact could be met by locals. IMPLAN is an I/O model and thus runs under the assumptions that there is infinite supply to meet demand in terms of both employees and commodities. Likewise for this reason it is also a static, linear model. So if there is a significant change to the structure of the economy, as you are suggesting here, we would anticipate that IMPLAN would not be able to capture a number of changes besides just Employment needs that would need to occur in that local economy (i.e. IMPLAN won’t be able to predict how many new businesses of what new business mix will follow this industry into the region). For this type of an impact you would need to try to determine how and where those supporting jobs for the industry would come from, IMPLAN just tells you they will be needed. Here are a couple of thoughts to take into consideration when trying to determine how those jobs: [ul] [li]? If the area is rural it may experience under employment. This could occur in a couple of forms. It might be that there are people who want work but can’t find any employment, so this would then provide an outlet to those individuals. Likewise people may have jobs, but they may be part-time, when the worker would prefer to have a full-time position or multiple full time positions. Since IMPLAN jobs are not full-time equivalents, some of these jobs, especially in industries with high rate of part-time employment may be taken up by people who are residents picking up additional employment (so now instead of counting as 1 worker at Walmart doing night stocking, Tim counts as 3 jobs because he picks up a part-time bartender job in the evening (a second IMPLAN job), and works as a landscaper in the mornings (a third IMPLAN job). [/li] [li]? Another consideration is that sometimes when large industries move into a region that didn’t offer much employment opportunity for younger generations, so a new industry coming into the region may capture additional in employment as regards younger employees previously not able to find jobs, or by keeping younger individuals in the local economy by providing them with employment options.[/li] [li]? As suggested above a new industry often brings new population seeking jobs. This then allows the Labor Income to still be local as new businesses are also drawn. Thus this is another way that additional employment doesn’t necessarily result in leakage.[/li] [li]? While your regions doesn’t appear from your description to have in-commuters, if it is extremely rural and there are urban centers that could supply in-commuters if the industry moved in, it may be that your region experiences out-commuting (payments from domestic trade to Employment Compensation) if this is the case more workers may remain in the region and thus increase local income.[/li] [li]? As regards potential in-commuters, does the region have an area to pull Employment from within a reasonable commuting distance?[/li] [/ul] One other consideration is that IMPLAN is an annual model, so it is showing you the amount of production and labor needed assuming the industry was operating at full capacity and with all its workers in place for a year. Because of this, and because most projects usually take some time to ramp up to their full operational level, you may want to consider the results in light of the fact that some of the production and Employment needs will become available gradually, thus giving the economy some time to accommodate the potential new demands to the region. Since there are a large numbers of unknown’s in a situation like this you as the analyst will probably need to do some extra research, perhaps looking into regions like South Dakota, where some of these changes have occurred in response to oil drilling to see if you can find trends that have been demonstrated, upon which you can base some behavioral assumptions in regards to how this economy might respond to such a significant change in its structure. Another consideration to keep in minds is that the jobs are still local no matter where the workers live so the only thing that needs to be adjusted is Employment Compensation and you can set the Employment Compensation to whatever proportion of worker's payroll that you think will live locally. Although this does ignore the probability that some in-commuters will still do some of their spending in the study area (gas, food, perhaps daycare…). In answer to your last question, IMPLAN will show the impacts to other industries that are needed to support the new industry – it just won’t show the impact of other companies/industries that may also choose to locate in the area in the future due to the presence of this industry. Hope this helps!