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Economic Contribution of the LaSalle County Mining Industry
Final Results
Presented to the LaSalle County Press Conference
Brian HargerResearch Associate
Center for Governmental StudiesNorthern Illinois University
North Utica, IllinoisMarch 24, 2015
Project Overview and Methodology
• The objective is to demonstrate the contribution of the mining industry to the economy of LaSalle County in terms employment, output (sales or revenue), value‐added (contribution to GDP) and taxes.
• The analysis was based on data supplied by the participating company’s annual direct employment, employee compensation and operating revenue.
• The study included companies whose primary business activity is:
• NAICS 212312: Crushed and Broken Limestone Mining and Quarrying
• NAICS 212321: Construction Sand and Gravel Mining
• NAICS 212322: Industrial Sand Mining
• NAICS 327310: Cement Manufacturing
• Data was collected from 6 companies operating in the County in 2013. Data was also estimated for the 3 companies that declined to participate.
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Key Concepts
• Employment (Jobs) – An employee is a person that enters into an agreement formal or informal, to perform work in return for compensation in cash or in kind.
• Output is the value of an industry’s production. For the mining industry this is sales plus or minus any change in inventory.
• Value‐Addedmeasures of LaSalle County’s economic output similar to “Gross Domestic Product” or “GDP”. It represents the difference between the value of goods and services purchased as production inputs and the value of the goods and services produced.
• Employee Compensation represents the total payroll cost of the employee paid by the employer. It includes wage and salary; all benefits and employer paid payroll taxes.
• The Multiplier Effect estimates the magnitude of the economic response in a geographic area associated with a change in business activity, either in terms of jobs or spending.
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Summary of Economic Impacts
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DIRECTJobs, wages and output (sales or revenue) sourced directly to the
mining industry
INDIRECTImpact of mining industry suppliers
and vendors
INDUCEDImpact of mining industry
employee spending in the local economy
TOTALSum of direct, indirect and induced
impacts
+
Source: LaSalle County Mining Coalition; IMPLAN; and the Center for Governmental Studies.
Figure 2. Estimated Impacts of the Mining Industry (2013)
LaSalle County, Illinois Direct Indirect Induced Total Multiplier
Employment 820 766 393 1,979 2.41
Output ($millions) $1,051.1 $148.1 $45.0 $1,244.2 1.18
Value‐added ($ millions) $290.9 $84.4 $28.9 $404.2 1.39
Employee Compensation ($ millions)
$61.8 $33.9 $11.9 $107.6 1.74
Employment Impacts• The LaSalle County mining industry directly employed 820 people in 2013.• The mining industry’s spending with suppliers supported 766 jobs in the
County (the indirect impact).• Household spending by mining industry employees supported 393 in other
businesses (the induced impact).• The total job impact of the LaSalle County mining industry (direct jobs+
indirect jobs + induced jobs) was 1,979 jobs.• It is estimated that every 10 jobs created by local mining companies
support or create an additional 14 jobs in other industries like healthcare, transportation, financial and business services and wholesale and retail trade — a multiplier effect of 2.4
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10 Jobs in the Mining Industry Support 14 Jobs in
Other Industries
Most Mining Employees Live in LaSalle County
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Based on a survey of the mining companies, 83% of the industry’s employees live in LaSalle County with much of the balance residing in nearby counties.
Output Impacts• The LaSalle County mining industry directly generated about $1 billion in
sales in 2013.• It was also responsible for stimulating another $148.1 million in output in
through the mining companies purchases from other LaSalle County businesses, as well as $45 million in output resulting from the household spending of mining industry’s employees (total impact of $1.2 billion).
• For every $1 million increase in output by local mining companies, an additional $184,000 in output is generated in other industries for a total impact of nearly $1.18 million throughout the LaSalle County economy —a multiplier effect of 1.18
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INDIRECT & INDUCED IMPACTS
$184,000
DIRECT IMPACTS$1,000,000
TOTAL IMPACTS$1,184,000
Value‐Added Impacts
• The Industry's contribution to local economy (GDP) in 2013 was over $400 million; 8.4% of total the GDP of LaSalle County.
• The business sectors most affected by the mining industry spending are electric utilities, financial services, trucking and engineering and other technical services.
• The kinds of businesses impacted by consumer spending of mining industry employees include healthcare, retailing and restaurants.
• For every $1 million increase in value‐added created by local mining companies, an additional $390,000 in value‐added is generated in other industries for a total impact of nearly $1.4 million — a multiplier effect of 1.39
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TOTAL8.4%
DIRECT 6.1%$290.9 million
INDIRECT 1.7%$84.4 million
INDUCED 0.6%$28.9 million
Source: LaSalle County Mining Coalition; IMPLAN; and the Center for Governmental Studies.
Economic Output as a Share of County GDP, 2013
Employee Compensation Impacts• LaSalle County mining companies paid $61.8 million in employee
compensation in 2013. • An additional $33.9 million in compensation was paid to workers in other
businesses as a result of the mining industry’s spending with suppliers.• Another $11.9 million in employee compensation being generated as a
result of household spending of mining industry employees. • For every $1 million increase in employee compensation paid by local
mining companies, an additional $741,000 in compensation is paid out in other industries for a total impact of about $1.74 — a multiplier effect of 1.74
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INDIRECT & INDUCED IMPACTS
$741,000
DIRECT IMPACTS$1,000,000
TOTAL IMPACTS$1,741,000
Other Findings
• Average annual wages of mining industry workers in the LaSalle County are $75,331; 82% higher than the average for all workers.
• Local mining companies paid $2.5 million in property taxes in LaSalle County in the 2013‐2014 tax year.
• In 2013, local mining companies provided summer employment for 38 high school and college students, paying over $271,000 in wages and benefits.
• LaSalle County mining company employees contributed 6,793 hours to local volunteer service activities
• Mining companies and their employees have also contributed their time, talent and money to over 50 community organizations, projects and causes in LaSalle County.
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Brian Harger, M.S., EDFPResearch Associate
Center for Governmental StudiesNorthern Illinois University
DeKalb, Illinois 60115
Phone: 815.753.0934E‐Mail: [email protected]
LinkedIn: https://www.linkedin.com/pub/brian‐harger/2/a47/705
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