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Growth Effect

The national growth effect shows the number of jobs an industry is expected to gain or lose according to the industry’s national job growth. So if the industry sees national net job growth, you can expect to see job growth in most regions within the country as well.

This is sometimes explained as “the rising tide that lifts all boats.” Imagine several boats floating near the shore. If the tide begins to rise, each boat will rise with the tide–just as each boat will lower when the water lowers. This rising and falling is the national growth effect. It’s important to remember, however, that sometimes one of these “boats” (which are industries, in this case) may be pulled down deeper in the water, or may be experiencing higher tides on its own. These phenomena can be explained by competitive effect (see below). To measure the national growth effect, we simply multiply the growth rate of the overall economy to the number of jobs in your region that are part of the industry.

National Growth Rate x Number of Regional Industry Jobs= National Growth Effect

 

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