Study: CVS contributed $1.2B to local economy

CVS Caremark Corp. said its Rhode Island operations had an overall economic impact of more than $1.2 billion and generated about 12,000 jobs.
Posted 2/10/12

WOONSOCKET – CVS Caremark Corp. said its Rhode Island operations had an overall economic impact of more than $1.2 billion and generated about 12,000 jobs.

The overall figure includes the company's indirect impact on the economy; it counts the activities of its suppliers and "induced" sources, such as household spending attributable to its operations.

CVS released the economic impact study just two days after its fourth quarter and full year earnings release. It was compiled by PricewaterhouseCoopers, using the IMPLAN model, derived from the U.S. input-output table as compiled by the U.S. Bureau of Economic Analysis.

Directly, CVS contributed $761.8 million to the economy through labor income and state and local taxes in 2010. In comparison, Rhode Island’s real gross domestic product in 2010 was $44.014 billion in 2010, according to the U.S. Bureau of Economic Analysis.

The company employed 6,032 people locally at its corporate headquarters, two distribution facilities, customer care call center, and 58 CVS/pharmacy stores.

In December 2010, there were 397,200 private sector jobs in Rhode Island, according to seasonally adjusted data from the state department of labor. CVS would have accounted for 1.5 percent of those jobs.

CVS paid about $66.6 million in taxes: $23.9 million in personal income tax withheld; $22.2 million in sales, use and excise tax; $15.1 million in income and payroll taxes; and $5.3 million in property taxes.

On Feb. 8, the company reported earnings results, with a net income of $3.46 billion in 2011, up from $3.42 billion a year earlier. Revenue increased 11.8 percent to $107.1 billion year-over-year.

CVS also look at the indirect impact its operations have; its headquarters drew more than 54,000 visits from suppliers, vendors and other visitors, having an impact on the local food, rental car and hotel industries.

The company noted that it invested more than $90 million in new Rhode Island-based capital building projects in 2010.

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