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<br />generally full employment conditions will
<br />prevall throughout the economy over the
<br />relevant period of analysis.
<br />Under a rigorous deftnltJon of full em-
<br />ployment all resources are employed In
<br />their highest use, resOurces are generally
<br />moblle, and the economy is in general
<br />equll1brlum. Under these conditions,
<br />many analysts ha.ve concluded water re-
<br />source investments would not result in
<br />achieving additional beneficial elfects
<br />from use of unemployed or Wlderem-
<br />. played. resources, since in the absence of
<br />a. water and land resource plan economic
<br />forces would continuously bring about
<br />readjustments toward full employment.
<br />With respect to future development,
<br />the OBERB projection serles, which is
<br />used as the economIc ba6e11ne for evalu-
<br />a.tion of future needs for water resource
<br />development, makes the assumption that
<br />"The Government will Implement the
<br />policies needed to malntain full empioy-
<br />ment under a free enterprise economy."
<br />Furthermore, impliCit within the projec-
<br />tions is the assumption that the levels of
<br />future development are predicated upon
<br />an orderly and reasonable development
<br />of water resources. The availab1l1ty and
<br />use of these projections does not obviate
<br />the need on a case-by-case basis to prop-
<br />erly interpret the full employment impli-
<br />cations to detenntne the particiJ.lar con-
<br />ditions where that assumption should
<br />be modlfied. Moreover, an area' or re-
<br />gional economy must sa.tIsfy certain pre-
<br />conditions as a basis for clea.rly demon-
<br />strating the posslb1l1ty of beneficial ef-
<br />fects arising from the uUlizatJon of un-
<br />employed or underemployed resources.
<br />These conditJ.ons and the estimate of
<br />beneficial effects related thereto are
<br />stated. below. .
<br />1. Resource immobilities. otherwise
<br />unemployed or underemployed resources
<br />(labor, :tlxed capital, and na.tural re-
<br />sources) may be used or better employed
<br />as a result of the economic activities
<br />generated by a plan. For this condition to
<br />apply it must reasonably be demon-
<br />strated that in the absence of the water
<br />reoourc6 plan the unemployed or under-
<br />employed resources to be aflected. by the
<br />plan would remain 1mmoblle (would not
<br />be producUvely employed or employed
<br />in higher uses anywhere. in the economy)
<br />over all or part of the penod of analysis.
<br />
<br />Whlle recogniz1ng that many resource
<br />Immobilllies tend to be of ,,,. long-run
<br />nature, there is a special class of re-
<br />source immob1l1t1e.s that occur only
<br />periodically snd for relatively short dura-
<br />tJons. They are usua.lIy associated with
<br />unusual weather or hydrologic conditions,
<br />in.terms of :flooding, low flows, droughts,
<br />adverse driUnage conditions, 8.Q.d the re-
<br />liability of water supply.
<br />In such situations, without, a plan,
<br />losses In output result through the denial
<br />of access to business establishments, pre-
<br />vention of the processing and movemen.t;
<br />of supplies and products, losses in the
<br />values of publlc servtces, loss of oppor-
<br />tw1lty for provision of personal services,
<br />and tile !lke. To the extent that such
<br />losses cannot be compensated for by
<br />
<br />NOTICES
<br />
<br />postponement of activity or, through
<br />transfer of such actlivIty to buslneos es-
<br />tablishments not affected, prevention of
<br />such loss is clearly Ident1fl:able M a con-
<br />tribution to regional development and Is
<br />not offset by losses elsewhere In the
<br />economy. The proper measurement re.
<br />fleeting thetie short- term resource im-
<br />mobilities is .the estima.te of net In-
<br />comes foregone or increased costs for
<br />prov1s.lon of services without the plan
<br />occasioned by WlUSUal and periodic con-
<br />ditions such as those listed above.
<br />(2) Other conditions and require-
<br />ments. A determination of the region or
<br />regions within which the major .impact
<br />of unemployed resource utilization e1fects
<br />will take place as a result of the plan is
<br />required. It can generally be a.ssumed
<br />tha.t the major share of such effects will
<br />take place _in relative clooe geographIc
<br />proxlm1 ty to the location of the direct
<br />usem or beneficiaries of the goods and
<br />services resulting from the plan. '
<br />An analysis of the key economic factors
<br />withln the affected region or regions is
<br />required and w1ll be made 8B a basis for
<br />detenn1nlng the lIkelJhood that " chronic
<br />unemployment or underemployment s1 t-
<br />nation will prevaJl in the future. 'I'he
<br />analysis mould include the past perform-
<br />ance, current situation, and projected
<br />situa.tion. The most critical factors to
<br />be analyzed should include the follow-
<br />ing: (1) Labor force participation rates
<br />by age, sex, and race; (2) Wlemploy-
<br />ment rates by age, Bex, and ra.ce; and
<br />(3) asverage earnings of workers or prod-
<br />uct per man-hour. . .
<br />The pwpose of t:hls analysis w1II be
<br />twofold. Fil'st, ~ w1II be necessary to
<br />have an accurate description of the un-
<br />employed and underemployed resources
<br />so they may be 11nked to possible bene-
<br />ficia.] effects of water -and land resource
<br />plans. Second, it will be. necessary to
<br />determ1ne from the analysIs the probable
<br />duration of the adverse employment s1t-
<br />uation (the Immobillty factorlln the
<br />8Jbsence of the plan. Th:I.s latter analysis
<br />will require an evaluation of the source
<br />of Wlemployment or underemployment.
<br />The above a.nalyses should indica:te
<br />whether t.hey are unemployed or under-
<br />employed resourees of slgnljlcant dimen-
<br />sions and duration which can be em-
<br />ployed through the water and land re-
<br />source plan.
<br />(3) MeaSurement of beneficial eUect,"
<br />of using unemploved re3OUTCe3. IdentJ-
<br />fylng and mellS1lrlng beneflclal elfecto of
<br />using unemployed. or underemployed. re-
<br />sources presents major diffioultiea at the
<br />present time. At the request of the COWl-
<br />ell, the omce at Business Econom.1cs and
<br />the Economic Research Service are en-
<br />gaged in studles of operaUonal tech-
<br />niques for the idenrti1lcalt1on and
<br />measurement of natJonal and regional
<br />income effects resulting from water and
<br />land resource plans.
<br />Each plannlng study should Include an
<br />analysis of the problem. Planning re-
<br />ports will show whether the area to be
<br />:Influenced by the plan has an unemploy-
<br />ment problem of slgnljlcant magnitude
<br />and whether the plan under evaluatlon
<br />
<br />24163
<br />
<br />will make 6 posItive contrlbutlon to re-
<br />ducing unemployment.
<br />e. Location "eDecu. Location or trans-
<br />fer effects of a plan can be benetlc1al or
<br />adverse dePending on the region being
<br />considered. In any case, these effects axe.
<br />real and important to a region even
<br />though from the national view they
<br />swn to zero across all reg10.r1s in the
<br />Nat1on. For this reason (as well as
<br />others) , regional evalu6tions should pro-
<br />ceed within the framework of a system
<br />of regional accounts.
<br />Location e1fects are generally esti-
<br />mated as a multiplim factor at the more
<br />direct project outpUts on the region
<br />be1i1g considered. .several alternative
<br />means 01 calculating such EL multiplier
<br />value are available. They include input-
<br />output stucUes, econom1c base studies,
<br />and the application of Keynesian multi-
<br />pller concepts to regions. Recent studies
<br />have tncUcated that all three approaches
<br />provide comparable valum for the same
<br />region. The Waterl Resources COuncll
<br />wlll provide 1nformation on the appro-
<br />priate multipller values to use for BPe-
<br />citle plann1ng studies.
<br />2. Regional emplO1lment. EllmJnation
<br />or substantial reduction of high rates or
<br />Wlemployment--and rela.ted underem-
<br />ployment-In particular geographical
<br />areas and among partiCular segments of
<br />the population has long been a natIonal
<br />concern, and a concern of affected
<br />regians. Water and land resource plans
<br />undertaken in designated areas charac-
<br />terized by signiflcant eeonom1c and em-
<br />ployment problems are generally har-
<br />monious with the regional development
<br />objective to increase employment per se.
<br />When this is the case----a.nd under with
<br />and without analysig......-benefic:iaJ. effects
<br />-are Identified and measUll'ed 88 the in-
<br />crease in the nwnber and types of Jobs
<br />resulting 'from the plan.
<br />To the extent possible, planning re-
<br />ports will provide reasonable estimates
<br />1nd1cating the compositIon of the in-
<br />creased e:mplQYment by the relevant
<br />service, trade, and industrial sectors, in-
<br />clUding a separate estimate for agrtcul-
<br />ture. The nature of the employment
<br />increase to each sector will be class1-
<br />lied with regard to the level of skill.
<br />requlred-unsldlled. semiskilled, and
<br />highly sldlled.
<br />Where practicable, the estimates
<br />'within each of the sect.ors will be further
<br />classtfled by other pertinent attributes to
<br />the projected employment mIx, such as
<br />age classes, sex, average wages, and labor
<br />force participation rates.
<br />Where the regional development oh-
<br />Jective relates to regional employment,
<br />adverse effects are any decrease in the
<br />numbers and types of jobs resulting from
<br />the development.
<br />3. Population distribution. Contribu-
<br />tions toward achieving specItled goals for
<br />population disperSal and urban-rural
<br />balance through improved d1stribution .of
<br />population and employment opportl.Ull-
<br />ties are included 88 beneficial etreetB.
<br />Although the historic movement of
<br />the Nation toward W'ba.n1zation has re-
<br />sulted In much social, cultural, technical,
<br />
<br />fEDERAL REGISTER, VOL. 36, NO. 24S-TUESDAY, DECEMBER 21. 1971
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