Printing integral to economy

The production of what you see and read on paper is an important contributor to the Northern Colorado economy. The commercial printing and publishing industry is represented on the label of beer or wine bottles you empty and on other products you see advertised and buy. This industry is similar to Eastman Kodak Co. in its business practices but more diverse, competitive and internally cooperative. Companies rangefrom RR Donnelley Norwest Inc. in Greeley to Signal Graphics Printing in Fort Collins. The commercial printing (lithographic) and miscellaneous publishing industries in Larimer and Weld Counties produce various printing-related
products. They produce these products by importing raw materials, buying local inputs, and adding value via investment and labor. This industry
employs about 1,200 workers, less than 1 percent of Northern Colorado’s labor force. The two largest production purchases are for commercial printing services (24 percent) and paper products (18 percent). Major purchases from the
same industry (commercial printing in this example) means that the numerous companies cooperate, obtaining specialized printing and publishing
services from each other for the benefit of their customers. This relationship is also reflected in sales data for this industry. Cooperation is an
important element in developing a competitive advantage for an industry in a region. Paper purchases are imported from outside Weld and Larimer counties because we have no paper mills. This industry buys more than $53 million
annually to create its products. Purchases are made locally from the advertising, entertainment, banking, postal service, electric service, and real estate
sectors. About 71 percent of purchases are imported. Annual sales are more than $96 million. Most sales are to the publishing industry (32 percent), companies producing periodicals (11 percent), labor
and civic organizations (9 percent), and malt beverages (6 percent, including many local brewers). Other sales are to the meat-packing, business services, hospital, sugar, newspaper, banking, personal-care and health sectors. Government agencies
purchase 9 percent of the product of this industry and households about 21 percent. About 49 percent of sales are exported. The advertising sector
also produces about $12 million of printing and publishing products. Multipliers are an expression of how interrelated an industry is with the rest of the local economy; the higher the multiplier, the more interrelated. The
sales multiplier for this industry is 1.59, indicating that for each $1 of sales by companies in this industry, an additional $0.59 of goods and services
are sold by other businesses in Larimer and Weld counties. A personal-income multiplier describes how income earned by employees affects incomes earned in other businesses in the region. The
personal-income multiplier is 1.72, indicating that every $1 of personal income earned by employees in this industry generates another 72 cents of
personal income in other sectors of the local economy. Employment multipliers describe how many secondary jobs are supported by each primary job. The employment multiplier is 2.04, indicating that for
every primary job in this industry, another 1.04 secondary jobs are supported in other local sectors. These multipliers are relatively low, indicating that most production purchases are imported. This is what makes them similar to Kodak. The import
substitution idea suggests that the local economy will expand when these imported inputs are supplied by local firms. On the other hand, a large portion of the production of this industry is exported (also like Kodak), providing cash flow for the Larimer-Weld region.
This export base idea says that a region will grow if it supplies the rest of the United States and/or world, creating income for local workers and other
resource owners. This industry is not labor intensive. About 57 percent of the value added to its products is wages and salaries. The rest is income to business owners
and stockholders (investment) and indirect business taxes. Labor-intensive industries are like Monfort Co., where a higher portion of value added in
the form of labor is required to create the product. John Green is a consultant and professor of economics at the University of Northern Colorado in Greeley. Eric Siverts is president of Siverts and
Associates in Fort Collins.