The Economic Development Research and Training Center now offers, . . .

An economic impact analysis traces spending through an economy and measures the cumulative effects of that spending. The impact region is determined by the client and can be the entire state, individual counties or a combination of multiple counties.

The vitality of the economic environment is shaped by the events that take place there, just as air quality in the physical environment is influenced by emissions of cars and factories. Events influencing a region's health can include:
Government projects, new businesses, expansions, military base conversions, plant closings, downsizing, demographic changes, policy changes, new laws,...

Economic impact statements can be formulated by using one or a combination of information consisting of statistical data from the Pennsylvania State Data Center, studies by the Economic Development Research and Training Center and/or data from the client that is unique to the project/event under study.

An analysis provides critical information for business firms, trade associations, governments, planners, economic development agencies, chambers of commerce, service organizations, policy-makers, and public interest groups.

One way of measuring economic impact is to forecast the number of jobs created or lost by an event. But many decision-makers, government leaders, and voters also want a prediction of the impact of an event on personal income, business production, sales, profits and tax collections. An economic impact analysis can show impacts in each of as many as 500 separate sectors of a region's economy.

Please contact the Economic Development Research and Training Center:

Ph. 717.948.6178 Fax. 717.948.6306
edrtc@psu.edu
online request form
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This service is a combined effort of the Economic Development Research and Training Center and the School of Business Administration, Penn State Harrisburg. The cost of an analysis is modest and depends on the specific project.

What would be the economic impact if a business expects 
to increase its operating budget by $2.5 million?

Our analysis of a multi-county region found that this expansion would increase the firm's direct local expenditure by $2.25 million for salaries and supplies. The remaining quarter million dollars would be spent outside the region and have no local benefit. Added incomes received by employees and owners of this and other firms would boost household spending by $1.8 million. Putting these together, total output of the region would rise by over $4.2 million per year. We projected that the firm's expansion would increase its local employment by 60 persons. Another 20 jobs would be created by other firms in the region. About $2.7 million would be added to personal income. State and local tax revenues would rise by $130,000. Our detailed analysis included separate economic impacts for output, income, employment and tax collections. Each of these expected impacts was shown separately for nearly 400 industries and sectors. Please note: an economic impact analysis depends on specific events, industries, region, time frame and economic conditions, therefore, impact assessments in other situations will differ substantially from those shown here.

Economic Impact Analysis shows the ripples: A local business increases its operating budget by $2.5 million. This leads to increases in the following areas Local business expenditures Spending outside local region Sales of suppliers Household spending Total output of the region +2.25 million +.25 million +.18 million +1.80 million +4.20 million Personal Income State and local tax revenue Employment __ Business __ Regional Industries +2.70 million +.13 million + 60 employees +20 employees