Do you know the total economic impact of attracting a business to your community? What impact does the closure of a business have on your local economy? How does your economy benefit from a new retail store, restaurant, casino, wind farm, or a new business or industrial park? Or what has been the economic impact of your economic development organization? These questions and many others can be answered by conducting an Economic Impact Analysis.
An Economic Impact Analysis utilizes detailed modeling to estimate the direct, indirect, and induced economic effects of a project on the economy of a community, region, state, or nation. The direct impact of a project includes the number of new jobs, earnings of the new workers, and sales/revenues for the project. A project can have similar impacts (jobs, earnings, and sales) on its supply chains, which is the indirect impact. The induced impacts are the result of other industries being impacted by the spending of the direct and indirect workers at retail stores, gas stations, restaurants, medical and dental offices, etc. The Jobs Multiplier for a project can be calculated by dividing the number of direct, inducted, and induced jobs created by the number of direct jobs.
The following are some of economic impacts that are measured in the analysis:
· Number of new direct, indirect, and induced jobs
· Earnings for new direct, indirect, and induced workers
· Increase in direct, indirect, and induced sales/revenues
· Number of new workers and total residents moving to the community
· Number of out-of-town visitors and customers to the community
· New commercial, industrial, and residential property added to the tax rolls
A new project also has fiscal impacts on local, county, and state governments such as:
· Sales tax
· Income tax
· Property tax
· Utility franchise fees
· Hotel/motel occupancy tax
· Other taxes and user fees
· Funding for local school districts
Smart Solutions Group has conducted a number of Economic Impact Analyses for our clients. Below are links to two of these projections – one is an renewable energy attraction project and the other is a retention project.
Clean Line Energy: This is a one-page summary of the potential economic impact of this new Super Grid project.
· NW Iowa Post Office Closures – SSG This is a report on the potential impact of closing rural post offices in a rural region. Here is another example of our service: Economic Impact – Blue Springs And Cedar Valley TechWorks