The Multiplier Effect in Action


As I was helping a relative get some trees trimmed in his front yard, I found a real world demonstration of what we call the “Multiplier Effect” in economic development.  The idea is that every job that is added to an economy also leads to the creation of additional jobs indirectly— jobs that are created to serve the business and homes of the people doing the original jobs.  In this photo of a short stretch of a residential street in intown Atlanta, you can see a HVAC repair truck, a plumbing truck, two electrician vans, and two tree-trimming trucks.  Right after I snapped the photo, an Amazon delivery van and dry-cleaning delivery van drove by. 

So on this half-block, at this single moment in time, six people with six jobs living in six houses are driving 12+ additional indirect jobs, along with countless more dispatchers, mechanics, parts wholesalers, fleet managers, accountants, and other folks working behind the scenes.

That is how the multiplier effect works.