Naics 238910

Hi Leo. To our knowledge, there is no specific sector for demolition and cleanup of old buildings in the NAICS code. We normally recommend that you import the spending pattern for sector 34 for this purpose. You can import the sector by navigating to>Setup Activities>Activity Options>Import>Industry Spending Patterns>Select Industry to Import. We have included a link to an article that describes more on using Industry Spending Patterns: implan.com/V4/index.php?option=com_multi...18:618&Itemid=71 Once you have imported the spending pattern you can modify it by highlighting Event lines that need to be removed (clicking in the far left-hand box will highlight the Event and make the Event blue as an indication). Once an Event is highlighted, the delete button will activate. You can use this method to delete out all the line items for purchases that are not desirable. Once you have removed all the purchases you don't want to make, leaving only operating machinery and services, you can normalize the remaining Events in the spending pattern by going to the Event Option>Change All>Normalize functions. This will make the Event lines sum to 1.00. You will then want to use the Edit Activity function in the upper portion of the screen to edit the Activity Level to your budget value (Output less Value Added) and we would recommend editing the name to demolition. Please let us know if we can be of further assistance.

Thanks for the reply. I am doing more of economic impact analysis in general so i dont know the complete details of spending. In this case can i just use industry change with sector 34 and put in total cost of demolition as 2 million and get a reasonable result? I did look at industry spending pattern and there a lot of industries so it may not be right for me to delete industries and normalize. Also i have ran into similar issue with industry spending pattern. So if industry is missing in the city, then i need to import industry spending pattern but it does not give direct impacts and tax results. How do i get the direct impact and direct tax results? Should i use proxy industry to get them? i.e take direct and tax results from proxy industry and add indirect and induced effect which i got from industry spending pattern? or can i just use proxy industry to get all the results given the fact that the industry does not exist in that city nor county?

Hi Leo, In regards to your first question, if you are looking exclusively at demolition, than you would want to remove all the positive construction related purchases like cement, steel, etc. But you would not want to remove any of the other purchases, because these will still be required to operate the construction business, as we have described below. If however, you are looking at a mixed construction project (i.e. your $2 million value includes both demolition and construction, and you have no way to split these values) you can use Sector 34 to proxy this, but we would recommend noting in your report that you may have more positive construction material purchases than you would had you been able to approximate the split. In regards to you latter question, are you looking at new industries moving into the region? If not than you would not want to use the Analysis-by-Parts method and add the industry activity to the region. In this case, and perhaps even in the case of the construction above, if there are no local construction companies, even though the construction activity is taking place locally, there is probably very little local economic activity because the contractor will be from outside the county and thus many of the input purchases, labor, profits would be outside of the target county. Likewise other types of activity may take place locally, such as the purchase of a large pieces of construction or other machinery, but if there is no local manufacturer, or if you did not know that that machinery was produced by a local manufacturer you would not want to assume that the manufacture of that equipment had any local impact. So if this is the situation you wouldn't want to model these. If you are looking at proxying a new industry moving into the region, you should hopefully know most to the Direct impacts (Employment, Labor Income, Output) already, but if not you can certainly proxy these by using the closest industry in the region as an Industry Change and then 'lifting' the Direct tax impact report. You would also want to mention that this was your technique in your report though to be clear how those results were obtained. Please note also that Analysis-by-Parts requires not just the spending pattern portion of the analysis but also a Labor Income Change activity to view the effects of the Direct Labor spending. --Implan Support Staff

Yes. This is new industry moving into region hence no multipliers in implan. So i import industry spending pattern for that industry and get indirect and induced impact. I also add labor income change activity since i know the wages. I use proxy industry to get tax effects. For direct impact, i know the output, wages and employment. How do i get value added? I can probably get value of raw materials imported and get difference from output but wonder if there is a way to get this if i don't have value for raw materials.

Hello Leo, You will want to make sure that the value you are entering into the Labor Income Change Activity Type is a fully loaded payroll value, that is that it includes wages, employer and employee payroll taxes, income taxes and benefits values. If you are working with a wage and salary value that does not include all these things, we have a wage and salary to Labor Income converter breakdown by Sector that is based on national averages that you can download here:http://implan.com/index.php?option=com_docman&task=doc_download&gid=206&Itemid=7, so that you are entering the correct value. Likewise you will want to ensure that your reported Direct Labor Income values (to be consistent with the reported values from IMPLAN) is a fully loaded payroll value. Solving for Value Added is actually a relatively quick calculation, based on the following equation Output = Intermediate Expenditures + Value Added. Thus if you imported spending pattern has a Sum of Event Values of 0.57 57% of the Output value will be Intermediate Expenditures and the remaining 43% will be reported Value Added. One quick check you will want to do before reporting is that Value Added should always be larger than Labor Income since Labor Income is a component of Value Added on the basis of the equation Value Added = Labor Income + Other Property Type Income + Taxes on Production. Please let us know if you have any additional questions. IMPLAN Support Team