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Differences between report and e-model
The model to assess the economic impact of smoking on a local economy has been developed in two stages. In 2004, the West Midlands Public Health Steering Group (WMPHSG) commissioned a piece of innovative research to determine the costs of tobacco on the West Midlands regional economy. The data sources and methodology used in the model are explained in the previous sections (see drop down box above) and the results of the modelling are presented in our 2004 report.
Following the review and dissemination of the report, the WMPHSG decided to use the basic model developed for the report to construct an e-model for health and economic development professionals. However, the methodology and data used to build the e-model was refined to increase the accuracy of the model and to provide more flexibility to users of the model. The key differences between the report and the e-model methodology are given below.
Model methodology differences
| Item | 2004 Report | 2005 E-model |
| Wages | Costs of lost work time through smoking related illness and cigarette breaks are calculated using average earnings across all socio-economic classifications and age bands. | Costs of lost work time through smoking related illness and cigarette breaks are calculated using earnings for each separate socio-economic classification and age band. |
| Economic activity | Average economic activity rate in West Midlands region is applied across all socio-economic classifications and age bands. | Model uses economic activity rates specific to individual socio-economic classifications and age bands. |
| Changes in employment | Using secondary data from national input-output model, report estimates changes in labour market due to a change in the number of smokers and the consequent changes in economic productivity. | Omitted from model. Viewed to be unreliable use of data in smaller local economies. |
| Cigarette breaks | Model assumes average number cigarettes smoked across all socio-economic classifications and age bands. | Model uses cigarette consumption for individual socio-economic classifications and age bands. |
| Attitudes | Includes data on attitudes of general public and smokers to smoking. | Omitted from model (no economic impact). |
| Scope | West Midlands regional economy only. | West Midlands regional economy, PCT economies and local authority economies. |
Due to the revisions to the model from the 2004 model to the 2005 e-model, the estimated costs of tobacco consumption for a given local economy are believed to be more accurate. The table below shows how the two methodologies compare when estimating the costs of smoking on the West Midlands regional economy (only main cost items are shown).
The data shows that the 2004 report and 2005 e-model produce similar estimates on most key cost items. However, the e-model estimates that the cost to business of cigarette breaks is significantly lower. This revised e-model estimate is viewed to be more accurate than the 2004 report for reasons explained in the above table.
Differences in estimated costs
| Item | 2004 Report | 2005 E-model |
| Cost of treating smokers for smoking related diseases | £189m | £201m |
| Cost of premature death of smokers in single year | £138m | £141m |
| Cost to business of staff smoking during working day | £668m | £495m |
| Cost of smoking related sick days | £196m | £220m |
| Total cost of West Midlands
regional economy (at current prevalence rate) |
£1,252m |
£1,109m |