$6.1 Billion Economic Impact by Mid-States MSDC Certified MBEs in Central Illinois, Indiana and Eastern Missouri
Indianapolis, Indiana, July 19, 2016 (Newswire.com) - In late 2015, the Mid-States Minority Supplier Development Council (Mid-States MSDC) retained The Institute for Thought Diversity (ITD) to assist the Council in conducting a study to assess the economic impact the Mid-states MSDC certified MBE community has on the three (3) states covered by the Mid-States MSDC, namely Indiana, Eastern Missouri and Central Illinois. This impact includes the increased business activity created by 184 Mid-States MSDC certified Minority Business Enterprises (MBEs), the jobs that are maintained/created as a result of this activity throughout the various sectors of state’s economies, and the incremental business taxes that are generated.
In many circles, with the rapidly changing demographics of the United States, the minority business sector is arguably the fastest growing segment of small business. Therefore, it stands to reason that ensuring the success of minority business will have significant, positive effects on both the United States economy in general and the Indiana, Missouri and Illinois economies in particular. Simply put, the economies of the three (3) states under the jurisdiction of the Mid-States MSDC cannot reach their full and true potential unless the minority business community in each of the states is growing and reaching its full and true potential and the Mid-States MSDC, in its various iterations, has a long-standing history as being a catalyst for that growth.
The purpose of this study is to present empirical evidence demonstrating the positive impact that the Mid- States MSDC minority business community has on the state economies of Indiana, Eastern Missouri and Central Illinois.
Employment
There are 41,035 jobs that are created or maintained within the (3) state Mid-States MSDC footprint as a result of the activities of the Mid-States MSDC MBE community. 17,998 of these jobs, or 44%, are people that are directly employed by Mid-States MSDC MBEs while the remaining 23,036 are made possible by the expenditures of either the MBE companies or their employees.
Labor Income
The 184 Mid-States MSDC certified MBEs disbursed $804 million in salaries, wages and benefits to the 17,998 employees measured in direct labor income. This direct labor income served as a catalyst for the
$282 million in indirect income paid to the non-MBE supplier community. It is necessary to remember that these businesses had to hire these additional employees to meet the business demands of 184 certified MBEs. The induced income is estimated to be a little less than $270 million bringing the total labor income effect to more than $1.36 billion, which equates to $3.7million per day.
State and Local Taxes
Finally, more than $198 million in additional business taxes will be created from the business activities of the Mid-States MSDC MBEs, equating to nearly $544,471 each day of the year. These are tax dollars generated from businesses benefiting from the heightened economic activity and the increased employment. Like most state governments, Indiana, Missouri and Illinois rely primarily on taxes to fund the public services that they provide to the individuals and businesses located in each of the states.
Indiana
The Output, or the amount of overall business activity created, is estimated to be more than $4.5 billion within Indiana, which equates to more than $12.4million each day of the year. This includes the revenues generated by the 144 Mid-States MSDC MBEs headquartered in Indiana (“Direct”), the amount of additional business activity created by those revenues (“Indirect”), and the amount of additional business activity created by people’s spending caused by the incremental labor income (“Induced”).
24,610 additional jobs have been maintained or created as a result of the sales revenue from the Indiana- based MBEs.
Labor Income resulting from the additional people employed and current employees earning more is estimated to be $1.36 billion, equating to more than $3.7 million each day of the year.
Finally, more than $129 million in additional tax revenue will be created from the increased business activity caused by Mid-States MSDC diverse suppliers, equating to approximately $353,000 each day of the year. These are tax dollars generated from businesses, their employees and their households, benefiting from the heightened economic activity and the increased employment created by the MBE community.
Eastern Missouri
The Output, or the amount of overall business activity created, is estimated to be more than $1.27 million within Eastern Missouri, or more than $3.3 million each day of the year. This includes the sales revenue generated by the activities of the 32 Mid-States MSDC Missouri based diverse suppliers (“Direct”), the amount of additional business activity created by that revenue (“Indirect”), and the amount of additional business activity created by people’s spending caused by the incremental labor income (“Induced”).
5,964 additional jobs have been maintained or created as a result of the Eastern Missouri diverse suppliers.
Labor Income resulting from the additional people employed and current employees is estimated to be almost $350 million, equating to more than $957,000 each day.
Finally, more than $31 million in additional tax revenue will be created from the increased business activity of the Eastern Missouri MBEs, which averages out to approximately $87,144 each day of the year. These are tax dollars generated from businesses, their employees and their households, benefiting from the heightened economic activity and the increased employment. These tax dollars can be used for programs that further benefit the communities within Eastern Missouri.
Central Illinois
The overall Output coming the Central Illinois Mid-States certified MBEs is estimated to be more than $1 billion, $2.9 million each day of the year. This includes the sales revenue generated by the 8 Mid-States MSDC Illinois based diverse suppliers (“Direct”), the amount of additional business activity created by that revenue (“Indirect”), and the amount of additional business activity created by people’s spending caused by the incremental labor income (“Induced”).
6,081 additional jobs have been maintained or created as a result of the Central Illinois diverse suppliers.
Labor Income resulting from both the additional and current employees employed is estimated to be more than$401 million, averaging out to more than $1.1 million each day.
Finally, almost $38 million in additional tax revenue will be created from the increased business activity of the Central Illinois MBEs, which averages out to be approximately $103,506 each day of the year. These are tax dollars generated from businesses, their employees and their households, benefiting from the heightened economic activity and the increased employment.
The results are in, and the empirical evidence is indisputable. Over $4.5 billion in annual revenue comes from the activities of the Mid-States MSDC certified MBE community. As a result, these same firms are employ 41,035 people both directly and indirectly resulting in the dissemination of over $1.34 billion in salaries and wages. Finally when combined with the more than $198 million in various tax revenues coming from the activities of the Mid-States MSDC certified MBE suppliers, this brings the total economic impact to over $6.1 billion.
ABOUT MID-STATES MSDC
Mid-States MSDC is one of 23 regional affiliates of the National Minority Supplier Development Council (NMSDC) with more than 1,700 corporate members and more than 12,000 certified minority business enterprises nationwide. The primary mission of the Mid-States MSDC is to promote and cultivate successful minority enterprises within the Central Illinois, Indiana and Eastern Missouri business communities. The Mid-States MSDC serves as an advocate for the economic well-being and growth of certified MBEs, while also providing a direct connection for corporations who are committed to purchasing products and services from Mid-States MSDC-certified MBEs.
ABOUT THE INSTITUTE ON THOUGHT DIVERSITY
Founded in 2014 under the direction of its founding member, Dr. Scott A. Vowels, The Institute for Thought Diversity LLC provides market research, economic impact analysis and thought leadership on broad issues of diversity and inclusion with a concentration on corporate procurement practices. The Institute seeks to bring together thought leaders and professionals to drive national economic development discussions with sound, independent research, analysis and assessment.
###
Source: Mid-States MSDC