technologies and related onshore support, resulting in different 

 combinations of onshore effects and impacts. Even for a single lease sale, 

 differing assumptions can create enormous variation among estimates of the 

 timing and rate of production, as shown in Figure 1. 



2.2 OUTLINE OF A SAMPLE FORECAST 



A better appreciation of how forecasting methods work in practice can 

 be gained from working through a sample. The following process (Figure 2) 

 has been somewhat simplified for clarity, but contains the major elements 

 of a working procedure. A brief description of the process is followed in 

 the next section by consideration of each of its elements. 



Initial steps in the process focus on OCS-generated employment within 

 the region under study: 



1. Direct employment is estimated first. This consists essentially 

 of workers required for any of the 15 OCS-related activities 

 described in Volume I. (A more detailed definition is given in 

 Section 2.3.1, where direct employment is considered more fully. 

 Also Appendix A presents direct employment data for these 

 important OCS-related facilities.) 



2. Indirect employment is estimated next. This consists of support 

 services, often contracted to vendors instead of being performed 

 directly by oil company employees. Equipment repair services are 

 an example (see Section 2.3.2). 



3. Induced employment is the third employment category to be estimated, 

 This consists of employment stimulated by the spending of wages 

 earned in direct and indirect employment. It is a broad category 

 which might include, for example, a doctor or a supermarket 

 checker (see Section 2.3.3). 



4. Total employment estimates are then obtained by adding together 

 the estimates for direct, indirect, and induced employment (see 

 Section 2.3.4). 



Once total employment has been estimated, the next steps seek to 

 derive the total added population that the study region is likely to 

 experience: 



1. New resident employees . The first of these steps is to estimate 

 the number of OCS-related employees who will be new residents of 

 the region, as distinguished from employees who already live 

 there, and employees who continue to reside elsewhere (see 

 Section 2.3.5) . 



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