Hinkley Point C and The Multiplier Effect

hinkley

Some great news on local jobs today in the Knutsford Guardian:

Nuclear engineering firm AMEC, based at Booths Park in Knutsford, is one of the key partners in EDF’s nuclear new build programme – the first of its kind in the country in almost 20 years.

Earlier this week, it was announced the Government and EDF Energy reached a commercial agreement on the key terms of a proposed investment contract for the Hinkley Point C nuclear power station in Somerset.

Following the news of the deal, AMEC said it expects to create up to 300 jobs in the North West before the building programme ends with a ‘fair portion’ of the vacancies to be allocated to the Knutsford office.

Frank Stokes, of AMEC, said: “We currently have well over 100 people working on the UK new build programme in both the UK and France, and we expect this figure to increase significantly as the programme develops.”

It’s a great example of the Multiplier Effect of Hinkley Point C in action in a town hundreds of miles away from where the investment is being made:

Multiplier Effect

Every time there’s an injection of new demand into the economy there is likely to be a multiplier effect. This is because an injection of extra income leads to more spending, which creates more income, and so on. The multiplier effect refers to the increase in final income arising from any new injection of spending.

Over 25,000 jobs will be created from the building of Hinkley Point C.  With all the discussion this week about whether the government has got value for money with this project its worth remembering how much extra economic activity is generated when a major infrastructure project is announced. 300 new jobs to a small town like Knutsford is a huge shot in the arm for local businesses, sandwich shops, dry cleaners, hair dressers, you name it.

And in this case we’re getting this boost from private investment, not increased government expenditure.

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