Labor / HH Income Activities, Direct Effects gone?

Hi Paul. The reason why you are not seeing any direct effect for Labor Income/Household Income activities is because by definition, households produce no direct effect. Since all labor income become household income, you could run this as a household spending pattern if you must see the direct,indirect, and induced effects of your model. To see the first round of payroll spending (as direct), industries buying goods and service (indirect) and additional payroll impacts (as induced), then you could import the household spending pattern (Setup Activities > Activity Options > Import > Institutional Spending Patterns then choose the household income best representing the employees) but this requires that you calculate the disposable income resulting from the new payroll. Note, that this "direct" spending will be around half of the total payroll as taxes, savings and imports have been removed. With a household spending pattern, all of the specified amount entered into the model is spent (i.e., none goes to savings, payroll taxes, or personal taxes). This option shows the direct, indirect, and induced effects. • Disposable income = household column's payment to Commodity, Foreign Trade, and Domestic Trade rows. To convert Payroll to Household Income: (this requires using the SAM report [Explore > Social Accounts > IxC Social Accounting Matrix (tab)]) 1. Make sure your payroll figure corresponds to Employee Compensation. It needs to include benefits, non-monetary income, and employer paid taxes; that is, it incorporates all employee-related costs. You can use our Income-to-EC conversion ratios if you need to convert. 2. In the Employee Compensation column, sum the payments to the 9 HH categories, then divide this sum by the column total (total Employee Compensation). The result is the amount of Employee Compensation that goes to local households. This nets out employer-paid taxes and in-commuters (imported labor). To convert Household Income to Disposable Income: this requires using the SAM report [Explore > Social Accounts > IxC Social Accounting Matrix (tab)]) 1. Choose the household column desired representing the HH income of your choice and note the column Total (last row). 2. Sum of the column's payments to commodities (row 2001) plus Domestic trade (28001) plus Foreign Trade (25001) for the desired HH income group of your selected. This nets out personal taxes and savings. Dividing this amount by the column total gives you the disposable income factor. Please let us know if we can be of further help.