Labor Income 2X Value Added


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    IMPLAN Support
    Hello Jeff, In regards to sector 430, the equation VA= EC + PI + IBT + OPTI does still apply, but total VA is less than Labor Income (EC+PI) because Indirect Business Taxes and OPTI are negative, so the balance of VA while still positive, is less than the value of Labor Income. Example: For the State of AZ, LI for 430 is $10,955,921 and OPTI+IBT= ($24,558,567). So the net value will be ~ ($13,602,646) indicating subsidization. If you are combining this with sector 438, the positive VA because 438's values are significantly larger than the net negative VA in sector 430. We are unsure if you are pairing these 2 sectors, what exactly you are trying to Model. Sector 438 is a payroll only sector and does not purchase ans Intermediate goods and services. Thus, it should not be used to model the Education Sector for state and local government. It is, in effect, a place holder in the SAM. If you are trying to model public education, you would want to use 392 as a proxy- zeroing out Proprietor Income and Taxes and Profits in the Customize> Study Area Data. Or you could use the state and local government education spending pattern which includes sector 438 or one of the specialty spending patterns for education found in the Utilities folder. (Setup Activities>Activity Options>Import>From Another Model>Navigate to Utilities Folder> select model MIG2007ActLib440_SpendingPatternsNoPayroll_for_Programs_by_SLGovt> and choose the spending pattern you feel is most appropriate. These spending patterns do not include payroll, so you would want to model the payroll as a Labor Income Change. Please let us know if you have any further questions.
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