Generating an Economic Impact Report
An Economic Impact Report shows you how both your Tier I and Tier II expenditures impact society as a whole. In order to generate this report, you will need to make sure that for the selected period, you have both Tier I and Tier II expenditures loaded into the system.
To start, locate the Economic Impact Console under the Tier I application.
Under Spend Criteria, select the appropriate year and "Apply" your selection. To finalize, SELECT "Generate Report". This will take a few minutes to generate. Once the report is ready to view, you will received an email notification.
The Report shows information such as:
- Total Jobs Supported
- Total Compensation
- Impact by NAICS classification
- Impact by Diverse Classification
Your Economic Impact Report is calculated using data from the Bureau of Economic Analysis RIMS II model. The Regional Input-Output Modeling System (RIMS II), a regional economic model, is a tool to objectively assess the potential economic impacts of various activities.
The RIMS II models uses three distinct parameters 1. amount of spend, 2. location (region) 3. primary economic activity represented by NAICS codes.
In instances where any of the 3 elements are not available (usually NAICS code) then the suppliers activity is automatically excluded from the calculation.
Here is more information about the RIMS II model:
About the RIMS II Model
The U.S. Bureau of Economic Analysis has updated its regional economic modeling system used by local planners, investors, and policymakers. This tool can help assess the potential economic effects of a new corporate headquarters, a highway project, or new regulations.
Economic impact studies use the Regional Input-Output Modeling System, known as RIMS II, to analyze how projects will ripple throughout county, state, or regional economies. For example, building a new road leads to increased production of asphalt and concrete. That leads to more mining. Workers benefiting from these increases will spend more money, perhaps on eating out or entertainment.
RIMS II is based on BEA’s national supply-use tables, also called the input-output accounts. These detailed tables show the goods and services produced by hundreds of industries and how those goods and services flow to other industries or consumers, for a comprehensive picture of relationships throughout the U.S. economy.
RIMS II uses BEA’s regional data to focus the picture on economic relationships within a specific area. For example, a bakery might buy eggs locally and cake boxes from afar. If a new corporate neighbor starts ordering lots of cakes, the bakery will spend more money in the local economy on eggs, but its increased box spending goes outside the region.
BEA uses a region’s economic relationships to calculate “multipliers,” used to estimate a project’s impact on the region’s total gross output, value added, earnings, and employment.
- Location (City/Metropolitan Service Area or state or in the USA)
Represents the total change in number of jobs that occurs in all industries Employment consists of a count of jobs that include both full-time and part-time workers. Whether an employee works 40 hours a week or 4 hours a week, they are counted the same in the RIMS II model.
Total Compensation (Total Earnings)
This value represents the total dollar change in earnings of households employed by all industries paid directly to households employed by the industry represented by the suppliers NAICS code, plus the total dollar change in earnings of households employed by all industries for each additional dollar of output delivered to final demand by the industry corresponding to suppliers NAICS code (So in essence, the “multiplier effect”).
Total Value Added
Represents the total dollar change in value added that occurs in all industries for each additional dollar of output delivered to final demand by the industry corresponding to the entry. Value added is often defined as the value of gross output less intermediate inputs.
The value of this measure is equal to the sum of compensation of employees, taxes on production and imports less subsidies, and gross operating surplus.
This is a measure of the economic activity created by the spending. Value represents the total dollar change in output that occurs in all industries for each additional dollar of output delivered to final demand by the industry corresponding to the entry.