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July 22, 2010

GSW has $78.5 million economic impact on region

University System of Georgia has $12.6 billion impact on state

            AMERICUS—Georgia Southwestern State University—along with the state’s 35 other public colleges and universities—had a substantial impact on the state’s economy during the 2009 fiscal year, generating 112,336 jobs and contributing over $12.6 billion into local communities, according to a study conducted by the Selig Center for Economic Growth in the University of Georgia’s Terry College of Business.

GSW’s economic impact on the area was estimated at more than $78.5 million, with an employment impact of 822 jobs for the community.

“While the impact of Georgia Southwestern on the local economy is important, it is only part of the University’s role as good citizens,” said GSW President Kendall A. Blanchard, Ph.D. “The many important roles that our faculty, staff, and students play in the community as volunteers, board members, and as good neighbors have an incalculable value that in many ways is just as important as the economic impact.”

The Intellectual Capital Partnership Program (ICAPP), an initiative of the Board of Regents’ Office of Economic Development, commissioned the study by Jeffrey M. Humphreys, Ph.D., director of economic forecasting at the Selig Center. To enhance understanding of how the University System of Georgia contributes to the state’s economy, he analyzed two categories of college/university-related expenditures: (1) spending by the institutions themselves for salaries and fringe benefits, operating supplies and  expenses, and other budgeted expenditures; (2) spending by the students who attend the universities.

            Of the University System’s $12.6 billion total economic impact, $8.4 billion, or 66 percent was due to spending by the USG institutions and the students attending them; the remaining $4.3 billion, or 34 percent, represents the impact generated by the re-spending of these dollars. The study concludes that, on average, every dollar spent by a USG institution or student injects an additional 51 cents into the local economy hosting a college or university.y.

“A college or university improves the skills of its graduates, which increases their lifetime earnings. Local businesses benefit from easy access to a large pool of part-time and full-time workers,” said Humphreys. “In addition, for each job created on a campus, there are 1.6 jobs that exist off-campus because of spending related to the college or university.  In these ways, and many more, the University System plays a critical role in Georgia’s economic recovery.”

The report said the University System’s 35 institutions also collectively accounted for 112,336 jobs in the state during FY ’09—2.8 percent of all the jobs in Georgia. Most of the jobs – 62 percent of them – are off-campus positions in the private or public sectors that exist because of the presence in the community of USG institutions. The remainder (38 percent) are jobs on campus. Of Georgia Southwestern’s 822 job employment impact, 553 of them are off-campus positions. The remaining 269 are jobs on campus

“Companies and agencies that depend on highly specialized skills often cluster around universities. This is especially true for the knowledge-based companies that are expected to grow faster than the economy in general,” said Terry Durden, assistant vice chancellor of the University System’s Office of Economic Development.

The Selig Center’s research has its limitations – it neither quantifies the many long-term benefits that a higher-education institution imparts to its host community’s economic development nor does it measure intangible benefits, such as cultural opportunities, intellectual stimulation and volunteer work, to local residents. Spending by USG retirees who still live in the host communities and by visitors to USG institutions (such as those attending conferences or athletic events) is not measured, nor are additional sources of income for USG employees, such as consulting work, personal business activities and inheritances.

Georgia Southwestern’s economic impact for FY2010 will show an increase as its student population grew by roughly 7 percent from FY2009. The University is poised to leave an even greater impact in FY2011 as it prepares for more student growth, new programs and facilities expansion.

The complete report is available at http://www.icapp.org/pubs/usg_impact_fy2009.pdf.

 - GSW -