Construction Contractors

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    IMPLAN Support

    Thank you for your post,

    We get our production functions - and thus our sectoring scheme - from the BEA's Benchmark I-O model. In this model, construction is based on Census structure types rather than NAICs codes. For most analyses this is preferable to trying to figure out how much of the various NAICs categories of contractors go into each structure. Because of this, things like electrical, painting, etc. do not have their own sectors; rather, these activities are included in the construction sectors.

     

    Using sector 57 to represent a single type of construction contractor is problematic, as a dollar of output for the sector represents the final cost of the structure built, not the cost charged by a particular contractor. The industry ratios for Employee compensation to Output and Intermediate Expenditures to Output are based on the aggregate of all the different contractors that constitute the construction sector. Therefore, using sector 57 for electricians and for painters will result in the same amount of employee compensation being generated for every dollar of Output (Industry Sales).

     

    It's not perfect, but in aggregate (i.e., if you combine all these contractors into one event), then the aggregation would work in your favor. However, know that the industry averages are based on all contractors associated to construction, some of which you may not be including in your analysis.

     

    If you have detailed information (expenses on goods and services, labor payments, taxes paid, profits) for these contractors, you could use the Analysis-by-Parts method to study the contractors individually or combined.

     

    Thank you,

    IMPLAN Staff

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