Draft Environmental Impact Statement for Roca Honda Mine

providing an estimate of the “ripple” effects in an economy
associated with a direct stimulus or investment.
The multipliers of IMPLAN measure these downstream or
ripple effects. The multipliers in IMPLAN are defined as the
sum of the direct, indirect, and induced effects divided by
the direct impact (table 56). In the IMPLAN model,
businesses produce goods to sell to other businesses,
consumers, governments, and purchasers outside the region.
The output is produced using labor, capital, fuel, and
intermediate inputs. The demand for labor, capital, and fuel
per unit of output depends on their relative costs.
The modeled impacts include the direct effects of spending
for development activities and consumption spending of
new residents and construction workers; the indirect effects
Chapter 3. Affected Environment and Environmental Consequences
The Employment Multiplier
A “multiplier” is a number used by
economists to determine the impact of
a project on the economy. It is the
ratio of total change in output or
employment to initial change (or
direct change). For example, if an
industry were to create 100 new jobs,
it would require materials and
services from its supplying industries.
If this increase in demand created 30
new jobs in the supplying industries,
the employment multiplier would be
1.3 (i.e., 100 (direct) + 30 (indirect
and induced)).
of local vendors providing goods and services to the primary firms; and the induced impacts of
employees of these firms spending a portion of their earnings in the local economy. Economic
activity is measured in terms of income and employment generated (or lost) due to the proposed
action. With increased spending, many different sectors of the economy benefit—not only the
directly impacted sector but also many sectors indirectly. All sides of the cost-benefit analysis are
analyzed, including costs to the local community and surrounding area as well as benefits the
mine would bring.
Table 56. IMPLAN definitions
Effect Definition
Direct The set of expenditures applied to the predictive model (i.e., I/O multipliers) for impact analysis
(i.e., a $10 million dollar order is a $10 million dollar direct effect).
Indirect The amount of the direct effect spent within the study region on supplies, services, labor and taxes.
Induced Measures the money that is re-spent in the ROI as a result of spending from the indirect effect.
Source: MIG, 2012
Each of these steps (direct, indirect, and induced) recognizes an important “leakage” from the
economic study region spent on purchases outside of the defined area. “Leakage” is the
nonconsumption uses of income, including savings, taxes, and imports that “leak” out of the main
flow between output, factor payments, national income, and consumption. Eventually these
leakages would stop the cycle (MIG, 2012).
It is difficult to estimate what portion of labor, materials, and equipment that would be provided
locally, by each county, or by the State. Ideally, 100 percent of the labor force would be filled by
the local population. In IMPLAN, the multipliers for new construction sectors have built in what
materials could likely be bought locally versus being imported. Roca Honda Resources, LLC,
would recruit locally, statewide, and nationally to fill labor and/or professional needs. Equipment
and materials would be procured locally as much as possible. However, a significant amount of
specialized equipment and materials required for uranium mining would not be available locally.
Such items would be shipped from other areas (Velasquez, 2012b).
DEIS for Roca Honda Mine, Cibola National Forest 289