Report: AT&T Economic Impact In State Over 5 Years, $26 Billion [The Hartford Courant]
(Hartford Courant (CT) Via Acquire Media NewsEdge) Feb. 16--The economic impact of AT&T in the state over five years is estimated to be $26 billion, counting direct and indirect spending as well as other impacts, according to a recent study.
The telecommunications company's investments and spending supported about 19,000 jobs on average from 2007-201 -- the years studied -- an average 6,000 directly as AT&T employees and 13,000 as secondary jobs supported by capital investments and other spending.
The study, conducted by the Connecticut Economic Resource Center Inc., looked at AT&T's spending and investment from both the wireless and the wireline sides of the company. AT&T sales in the state during the years studied averaged to about $3 billion a year.
"The findings of the report requested by AT&T show the company's direct contribution as well as the indirect effects that ripple throughout the state's economy," said Alissa Dejonge, director of research at the Connecticut Economic Resource Center.
The report, in the very least, is a glimpse into the ways that a company's spending and investments reach out into the state through employees, operations and capital projects.
It also attempted to quantify how that initial, direct company spending results in other companies hiring and spending.
The economic impact study begins with AT&T's spending in the state through daily operations. To that it adds capital investment spending and other operations spending. Finally, it considers how the first two categories of economic impact induces companies to invest in operations and employment.
Direct daily AT&T operational costs, including employee salaries, amounted to just under $15 billion in economic impact over five years, and AT&T operational purchases indirectly amounted to about $6 billion.
In the years studied, AT&T in Connecticut spent $1.2 billion directly on capital investments -- things like communications infrastructure and office computers. About 51 percent of that, or $627 million, was spent in the state.
Fred Carstensen, director of the Connecticut Center for Economic Analysis at the University of Connecticut, said that the specific research method used for impact study could have shown the company's output to be larger than reality, if only by a bit.
The exact research method used to measure the company's economic impact by tracking the rippled effects from investments and operation would tend to "mildly overstate the impacts," Carstensen said, because it is designed for short snapshots in time, not multi-year estimates.
As a snapshot rather than a picture of growth over time, the study leaves questions unanswered about what AT&T uniquely is offering the state's economy. In other words, what the company is doing that wouldn't be offered by just any other telecommunications company.
"If AT&T disappeared tomorrow, I can guarantee you that by the end of the day there would be three actors that would be vying to fill that space," he said.
One surprising fact in the study, said Dejonge of CERC, is the wide variety of sectors in which AT&T operations support jobs. About 7,600 of the jobs supported "were in information technology; 3,300 in wholesale and retail trade; 2,600 in finance, insurance and real estate; and 2,300 in professional scientific and technical services.
The company in that time also directly paid $289 million in taxes, with its customers paying $449 million in taxes.
(c)2013 The Hartford Courant (Hartford, Conn.)
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