A presentation to the McHenry County Council of Governments made on October 28, 2015 by Brian Harger, Research Associate at the NIU Center for Governmental Studies.

1. Brian Harger
Research Associate
Crystal Lake, Illinois
October 28, 2015
Presented to the
McHenry County Council of Governments

2. Project Overview: What We Did
• Demonstrated the contribution of the mining industry to the
economy of LaSalle County.
• This included impacts of mining industry employment, output (sales
or revenue), and value-added (contribution to GDP).
• The impacts were calculated for business-to-business spending
(indirect impacts), as well as the household spending of employees
(induced impacts).
• A written report of the results was prepared that also included an
overview and brief history of the mining industry in LaSalle County.
• Results of the analysis were presented in a private briefing of
elected officials and a press conference that included local media,
representatives of the Mining Alliance and the public.
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3. Methodology: How We Did It
• The mining industry was defined as companies whose primary
business activity is:
• Crushed and Broken Limestone Mining and Quarrying
• Construction Sand and Gravel Mining
• Industrial Sand Mining
• Cement Manufacturing
• Based on a survey of 6 companies operating in the County in 2013
(Data was estimated for the 3 companies that declined to
participate).
• The impacts were calculated with IMPLAN, a popular Input-Output
statistical model.
• Information was also collected on local property tax contributions
of mining companies, as well as the industry’s contribution to local
civic groups and causes (community service hours by employees
and a list of groups and projects).
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4. 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-Added measures 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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5. MULTIPLIER EFFECT
For every 10 jobs created
or retained by local mining
companies…
… another 14 jobs are
supported in other
industries like healthcare,
transportation, financial
and business services and
wholesale and retail trade.
A multiplier effect of 2.4
Employment Impacts
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DIRECT EMPLOYMENT
Persons employed directly by LaSalle County mining
companies
INDIRECT EMPLOYMENT
Jobs supported by mining industry suppliers and vendors
INDUCED EMPLOYMENT
Jobs supported by the household spending of
mining industry employees
TOTAL EMPLOYMENT
Sum of direct, indirect and induced impacts
+
820
766
393
1,979
+
=

6. Where Mining Employees Live
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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 rest residing in nearby counties.

7. Output Impacts
MULTIPLIER EFFECT
For every $1 million in output
generated by local mining
companies…
…an additional $184,000 in
output is generated in other
industries in LaSalle County
A multiplier effect of 1.18
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DIRECT OUTPUT
Output (sales or revenue) generated by LaSalle County mining companies
INDIRECT OUTPUT
Output generated by mining industry suppliers
and vendors
INDUCED OUTPUT
Output generated by the household spending
of mining industry employees
TOTAL OUTPUT ($ Millions)
Sum of direct, indirect and induced impacts
+
$1,051.1
$148.1
$45.0
$1,244.2
+
=

8. 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.
• 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 $1.39 million — a multiplier
effect of 1.39
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TOTAL
8.4%
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

9. MULTIPLIER EFFECT
For every $1 million in
employee compensation paid
by local mining companies…
…an additional $741,000 in
employee compensation is
paid by other businesses in
LaSalle County
A multiplier effect of 1.74
DIRECT COMPENSATION
Output (sales or revenue) generated by LaSalle County mining companies
INDIRECT COMPENSATION
Output generated by mining industry suppliers and
vendors
INDUCED COMPENSATION
Output generated by the household spending
of mining industry employees
TOTAL COMPENSATION ($ Millions)
Sum of direct, indirect and induced impacts
+
$61.8
$33.9
$11.9
$107.6
Employee Compensation Impacts
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+
=

10. Summary of Economic Impacts
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DIRECT
Jobs, wages and output (sales or
revenue) sourced directly to the
mining industry
INDIRECT
Impact of mining industry suppliers
and vendors
INDUCED
Impact of mining industry
employee spending in the local
economy
TOTAL
Sum of direct, indirect and induced
impacts
+
Source: LaSalle County Mining Coalition; IMPLAN; and the Center for Governmental Studies.
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

11. 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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12. Brian Harger, M.S., EDFP
Research Associate
Center for Governmental Studies
Northern Illinois University
DeKalb, Illinois 60115
Phone: 815.753.0934
E-Mail: bharger@niu.edu
LinkedIn: https://www.linkedin.com/pub/brian-harger/2/a47/705
Copies of the LaSalle County Mining Industry study may be viewed or downloaded at:
http://www.slideshare.net/BrianHarger/la-salle-il-mining-impact-final-report-3-2015
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