W h e r e a r e t h e J o b s ?
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A significant limitation of the economic analysis has been the use of total output and employmentmultipliers to measure the economic impact of visitor spending. The first measure captures the businessimpact, and the second captures the worker impact, but neither captures the well-being of San Diegoresidents. A personal-income measure of economic impact of visitor spending would have captured thechanges that result in level of personal income in the San Diego community. One example of computing the economic impact on San Diegans’ incomes is the Type III Income Multiplier.Type III Income Multiplier = Direct, Indirect (and induced) Income/Direct SalesIncome or value added are the best measures of the economic gain to the region from tourism, andshould have been used rather than sales multipliers.
With regard to the use of employment multipliers, Professor John Crompton of Texas A&M hasidentified three common abuses in consultant reports in promoting tourism:
Employment estimates invariably include full-time, part-time, and seasonal jobs and do notdistinguish between them;(2)
Employment estimates assume all existing employees are fully occupied, so an increase inexternal visitor spending will require an increase in level of employment within the jurisdiction;this exaggerates number of jobs created in an industry with rampant underemployment.(3)
Imply that all new jobs will be filled by residents from within the community; however in highcost-of-living regions like San Diego, a significant proportion of low-wage jobs will be filled bycommuters from outside the community.
EVALUATING THE “7,000 NEW JOBS” CLAIM
The “7,000 new jobs” claim
for the San Diego Convention Center Phase III expansion project is based ona consultant study in 2009 that estimated new attendees and multiplied those by the spending bycategory per attendee and number of jobs from those spending categories. A later memo issued inresponse to the city council request shows the distribution of the jobs by industry.In this section we examine the assumptions behind the claim, to paint an accurate picture of the jobscreated by the project.
Archer, B. H. 1984. "Economic impact: Misleading multiplier."
Annals of Tourism Research
11(3): 517- 518.
Crompton, John L. 2006. Economic Impact Studies: Instruments for Political Shenanigans?
Journal of Travel Research
, Vol. 45, August 2006, 67-82. Crompton, J. L. 1993. "Economic impact analysis: Myths andmisapplication." Trends 30(4): 9-14.
Mayor Jerry Sanders “Factsheet” dated May 12, 2011; San Diego Convention Center Expansion Project updatepresented to the Budget Committee on September 21, 2011. The claim has been used in several public statementby the Mayor.