ECONOMIC FORECASTING FOR VIRGINIA'S WATER RESOURCE PROGRAMS1

Abstract

ABSTRACT: Water resource and water quality management planning depend, to a large degree, on forecasts of industrial activity and population projections. A flexible economic data base is especially important where planning follows varying formats of geographical and industrial detail. Records of employment and payroll are collected in the administration of Unemployment Insurance (U.I.) programs and are available from State Employment Agencies. These statistics have been collected over a long period of record (thirty‐five years). Many years of record are available on punched‐cards or magnetic tape and may be arrayed and manipulated by computer. This basic approach has been followed in Virginia. Historical U.I. payroll and employment records for the period 1956 through 1970 were procured on magnetic tape. This data was arrayed by major hydrologic area and by regional planning district. Projections of manufacturing activity were then generated by fitting several exponential equations to annual payroll data in two‐digit Standard Industrial Classifications. These exponentials were then extrapolated to provide a range of industrial projections. Other parameters of manufacturing activity were then correlated to the payroll data to generate projections of indexes such as employment, value‐added, and gross manufacturing output. U.I. payroll data is now being correlated to parameters in non‐manufacturing categories. Projections for industries such as trade and services will link extrapolated payroll data with benchmark correlations of payroll and sales receipts.