Analysis of North Carolina Forest Industry Earnings: Adapting Household-Level Data from the American Community Survey to a Social Accounting Matrix

There is a significant need to not only understand how different industries contribute to overall wealth but how they affect certain segments of society. This study augments input-output social account matrix (SAM) modeling techniques with American Community Survey (ACS) Public Use Microdata Samples (PUMS) to better characterize North Carolina forest products industry earnings' impact on low-, medium-, and high-income households. A 2014 North Carolina SAM was created using IMpact Analysis for PLANning (IMPLAN) and customized so that industry-specific earnings were allocated to household income classes according to the distributions contained within the ACS-PUMS data set. Multipliers were determined to describe earnings distributions per dollar change of final demand. These multipliers were then contextualized by perturbing the SAM model with a 10% change in final demand for relevant forest product industries. The results of the analysis indicate that SAM analysis methods based on unmodified IMPLAN models underestimate earnings paid to low-income and overestimate earnings paid to high-income households resulting from economic growth in the study area. Scenario results obtained using our updated SAM model highlight the improved analytical capabilities of this approach for measuring impacts across income class.