Single Company Contribution Analysis

Hello Neil, You can certainly use the single Industry Contribution Analysis method to look at an individual firm but this will provide a conservative estimate of the what the firm does in the region. The other straight-forward alternative is to run an impact analysis using the standard methodology with your firm level numbers and describing the results as what your company supports in the local economy. This will likely be a slight overestimation. The reason behind this is that the contribution method constrains the Model so that other purchases of that Sector cannot exceed the initial, unadjusted, Industry Sales value. This is necessary when you look at an entire Industry's production because the amount of sales cannot exceed regional Output (i.e. if you region produces $3MM of a commodity, your analysis is invalid if estimates $3.5MM of the commodity). But when a single firm is considered, unless it represents the entire Industry then purchases from other like firms in that Sector are a real possibility. So for example, a grain farmer will buy grain for next year's crop (Indirect) and we buy grains and product made from grains thus grain farming will be impacted through labor spending (Induced). Therefore, if the grain farmer is one of many farmers in the area, these feedback linkages are largely legitimate. But depending on the size of the farmer's operations in comparison to the total regional production some constraint over a standard impact analysis may be appropriate. Unfortunately where this line lies is really up to the interpretation of the analyst. Often in these cases we recommend running both methodologies with the understanding that the real contribution lies somewhere in-between the two result sets. Information about the total production of the Industry can be found at Explore> Study Area Data if you are wanting to compare it to your individual firms production. We hope this addresses your concerns. Please let us know if you have any additional questions, Thanks!

Thank you. This is helpful. I have employment numbers, gross payroll and the remaining operating expenditures (the latter loosely broken out). Do I simply run Industry Changes for each operating expenditure along with a single Industry Change in the company's sector (medical research, IMPLAN Sector?) that accounts for both the copany's payroll and employment (I'll need to edit one)? Or can/should I incorporate any Labor Income separately? Thanks.

Hi Neil, This would be an either or case. Basically you have 3 possibilities: 1. You can run the Industry Change Activity and edit the Employment and Employment Compensation values to match your known. This will use the default spending pattern in IMPLAN but your labor and Employment numbers. 2. You can import the spending pattern for the Medical Research Sector and edit it based on your operating expenditure information and run a Labor Income Change to account for the labor spending. 3. You can create your own operational spending pattern from scratch using the Industry Spending Pattern Activity Type with LPP set to SAM Model Value unless you have locality of purchase data, and run a Labor Income Change alongside it to capture you labor spending. In both the latter cases you will be doing an Analysis-by-Parts what you choose to do will depend on the level of detail you feel comfortable with for your operational expenditures. Hopefully this helps --Implan Support Staff