The Economic Impact of the High Point Market

1. Lukas Brun & Bill Lester Center on Globalization, Governance & Competitiveness Duke University October 19, 2012

2. Website:http://cggc.duke.edu/

5. Methods • Goal: Calculate the economic activity generated annually by the High Point Market – capture all impacts associated with the Market – activity that would not have occurred ‘but-for’ the Market • Study area: 75 mile radius from High Point, NC – includes 22 NC counties and 8 in VA • Methodology: – IMPLAN 3.0 (IMpact Analysis for PLANners) software – Original Survey • Web-based survey of 1,668 companies conducted July 3-16, 2013. • Key purposes of the survey: – Estimate sales figures generated at the Market – Estimate vendor & visitor spending figures by major category – Estimate share of companies that manufacture within the study area – Supplementary data from HPMA and NC Dept. of Commerce © 2013 Duke CGGC

6. Key Terms • Direct: Impacts resulting from the increase in final demand in a given economic sector • Indirect: Impacts resulting from industry to industry purchasing (i.e., business to business/supplier relationships) • Induced: Impacts resulting from increases in household spending © 2013 Duke CGGC

8. Total Economic Impact: $5.39 Billion Category Amount Visitor Spending $ 604 Million HPMA Spending $ 8 Million Vendor Spending $ 452 Million Furniture Sales $4,229 Million Vendor Rents* $ 95 Million Total $ 5.39 Billion * local portion only © 2013 Duke CGGC

11. Activity 1: Visitor Spending • In 2012, the HP Market attracted 150,000 visitors • GIS analysis of zip codes indicated that 116,000 were non-local • Resulting in 622,762 visitor days per-year • Used NC Dept. of Commerce Tourism figures for average visitor spending © 2013 Duke CGGC Impact Type Employment Labor Income Value Added Output Direct Effect 4,040 $109,749,029 $185,402,534 $354,801,848 Indirect Effect 1,026 $43,208,450 $69,970,714 $124,415,437 Induced Effect 1,124 $42,165,380 $75,806,342 $124,927,343 Total Effect 6,189 $195,122,859 $331,179,591 $604,144,628

12. Activity 2: HPMA Budget • Modeled direct annual spending of the HPMA • Categorized budget into transportation, parking, marketing and general organizational services • Excluded capital expenditures © 2013 Duke CGGC Impact Type Employment Labor Income Value Added Output Direct Effect 63 $1,826,935 $2,741,970 $4,648,565 Indirect Effect 10 $405,625 $676,379 $1,179,450 Induced Effect 17 $618,145 $1,112,560 $1,832,122 Total Effect 90 $2,850,705 $4,530,909 $7,660,138

13. ©2013 Duke CGGC Activity 3: Vendor Expenses • Figures obtained directly from survey – Construction/venue set up $211,186,800 – Photography $39,858,581 – Printed materials $25,568,060 – Other marketing expenses $47,685,725 – Catering $24,006,169 Impact Type Employment Labor Income Value Added Output Direct Effect 2,808 $100,098,361 $133,432,002 $278,256,098 Indirect Effect 632 $26,534,879 $40,460,372 $69,652,303 Induced Effect 934 $35,006,279 $62,980,188 $103,741,166 Total Effect 4,374 $161,639,519 $236,872,561 $451,649,567

14. Activity 4: Market Sales • Used survey response data to calculate the total sales garnered from the market (or within 90 days) Impact Type Employment Labor Income Value Added Output Direct Effect 13,920 $630,760,911 $1,111,034,805 $2,680,148,872 Indirect Effect 5,624 $268,274,110 $426,515,902 $816,681,056 Induced Effect 6,587 $247,255,774 $444,259,652 $732,421,143 Total Effect 26,131 $1,146,290,795 $1,981,810,359 $4,229,251,072 © 2013 Duke CGGC

15. Activity 5: Rental Income • Expert interview with Major Leasing Company Associate who controls 5.4 million sq. ft. • Total: Calculated as IMPLAN industry impact for Real Estate Establishments • Allowed IMPLAN to estimate share of local ownership Impact Type Employment Labor Income Value Added Output Direct Effect 630 $6,830,623 $51,166,612 $71,500,257 Indirect Effect 122 $4,050,589 $8,334,727 $14,493,809 Induced Effect 80 $3,013,160 $5,423,373 $8,930,813 Total Effect 832 $13,894,371 $64,924,712 $94,924,879 © 2013 Duke CGGC

16. ©2013 Duke CGGC North Carolina Fiscal Impact Type of Tax Amount (2013$) Sales Taxes $44,031,909 Income Taxes $32,399,763 Dividends $19,537,895 Other Taxes on Production and Imports $15,331,823 Corporate Profits Tax $7,616,622 Social Insurance Taxes $2,398,406 Motor Vehicle License Revenue $1,883,210 Total State Revenue $123,199,628

17. Guilford/High Point Fiscal Impact • Includes both county and municipal governments • Excludes impact of furniture sales (Activity 4) • Modeled impact of 75% (by assumption) of Visitor and Vendor Spending in Guilford County • Adjusted sales tax for local portion (2% local / 4.75% state) Type of Tax Amount (2013$) Sales Taxes (local portion only) $6,649,286 Property Taxes $17,246,014 Fines and Fees $1,586,886 Other Personal Taxes/License revenue $49,923 Total Guilford County $25,532,109 © 2013 Duke CGGC

18. THANK YOU Questions? Lukas Brun Senior Research Analyst lukas.brun@duke.edu