Ben Franklin Technology a boon, study says
February 12, 2009
Philadelphia Business Journal
Technology companies that received funding from Pennsylvania’s Ben Franklin Technology Partnership network from 2002 through 2006 boosted the state’s gross state product by $9.3 billion over that time, according to a study released Thursday.
Discounting inflation, the boost was $8.7 billion, according to the study, which was done by the Pennsylvania Economy League, a nonpartisan research organization with offices in Harrisburg, Philadelphia, Pittsburgh and Wilkes-Barre.
The PEL reached the conclusions in the study by comparing the companies that received funding from the Ben Franklin network from 2002 through 2006 to a group of similar companies that didn’t receive network funding.
The PEL used a mathematical procedure called regression analysis to show that the network funding the companies was statistically significant in explaining why the companies that got the funding added more jobs than the ones that didn’t.
Specifically, PEL found that, on average, companies that received Ben Franklin funding added five more people in each year after they got the funding than they would have added if they had not gotten the funding. It was then able to use multipliers to measure the economic impact of the funding.
Some of its other conclusions:
• The state of Pennsylvania received more than $517 million in additional tax revenue from 2002 through 2006 as a direct result of the $140 million invested by the Ben Franklin network during that time, which represents a 3.5-to-one payback on the network’s investment.
• From 2002 through 2006, Ben Frankin network funding generated 10,165 additional job years in companies that received it. A job year is a year of full-time work, meaning that three people employed for five years represent 15 job years. The job years generated by the funding were in industries that pay 33 percent more than the average nonfarm salary in Pennsylvania.
• From 2002 through 2006, the Ben Franklin network funding generated 32,832 job years in Pennsylvania.
The Ben Franklin Technology Partners network consists of four independent nonprofits that receive funding from the Ben Franklin Technology Development Authority, which is part of the Pennsylvania Department of Community and Economic Development.
The Philadelphia-area network affiliate is Ben Franklin Technology Development Authority of Southeastern Pennsylvania.
The study was conducted to evaluate the impact of the network on its 25th anniversary.
http://www.bizjournals.com/philadelphia/stories/2009/02/09/daily43.html