Petrochemical complex in TX

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    IMPLAN Support
    Hello, Impacting two different Sectors will have 2 different Output per Workers and 2 different Labor Income per Worker values that will also attribute different values. When you don't have enough information to split the functions apart (i.e., all I know is that there are 550 employees), using 166 is the 'better' methodology because it's going to make those splits for you. When you have more data, then it's recommended that you bifurcate these industries using [url=http://support.implan.com/index.php?option=com_content&view=article&id=359]Analysis-by-Parts[/url]. Using TX as a basis, here are some thoughts/illustrations: Output per Worker between these two Sectors is significantly different to the point where 200 workers in Sector 161 produces twice as much Output $ as 550 workers in Sector 166. This will of course significantly impact the Total Employment effects. Labor Income per worker is 10% higher for 161. So this will also drive larger Induced Employment results. Taking the data from the balance sheets (Explore> Social Accounts> Balance Sheet), we can see that on average the Regional Absorption for Sector 161 purchase by 166 is 17.546%, thus the initial value that the Model will apply to Sector 161 when an impact of 550 employees is added to Sector 166 is $164,172,640.65 (550*opw for 166 of $1,701,218*17.546%) whereas the starting value for 161 if 200 employees are entered into this Sector as a Direct Effect is $1,939,456,600.00. These aren't even in the same level of magnitude, but reflect the very different natures of these two types of production and the employment requirements for them. Thus it's demonstrable how important it is to have accurate starting values if you want to split the Employment between the two types of production occurring at a single site. To split them, we would recommend using the Output per Worker ratios to convert the Employment values to dollars and then be sure that the spending patterns are expressed in the Event Year of the Model data, if only Employment is known. You can then use the Explore> Social Accounts> Balance Sheet (Tab), and select View By: Industry Balance Sheet and the Commodity Demand tab and Value Added tab to parse the sales value across the budgetary component of 166 and the Employee Compensation/Proprietor Income component of 166. Importing the spending pattern for 166 you would delete the Event line for 161 and then normalize the spending pattern (again with Event Year in the year of the Model if Output per Worker is used to estimate the Output value). The budgetary portion should be further reduced by the value of the sales going to 161 to avoid double-counting. Once this setup is done the spending pattern is ready for analysis and the ratios from the Value Added tab can be used for the Labor Income Change. Sector 161 can be run as an Industry Change with the known value of Employment. Regards IMPLAN Staff
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