A recently released study says the University System of Georgia has a $9.7 billion annual economic impact on the state, a $1.7 billion increase since a similar study was conducted in 2002. Of the system’s 34 member institutions, the University of Georgia has the single greatest economic impact on its host community.
The study shows UGA-the system’s largest institution with 33,405 students-has a $2 billion impact on the Athens-area economy or 21 percent of USG’s total statewide economic impact.
“Everyone in our community understands that UGA is the engine that drives the local economy,” says C. Patrick Allen, director of community relations at UGA. “However, you have to see the actual numbers before you can fully appreciate the enormity of the positive financial impact we bring to northeast Georgia.”
Counties in the UGA study area are Clarke, Oconee, Madison, Oglethorpe, Jackson, Barrow, Walton and Gwinnett.
The Intellectual Capital Partnership Program, an initiative of The Intellectual Capital Partnership Program, an initiative of the board of regents’ Office of Economic Development, commissioned the study by Jeffrey M. Humphreys, director of economic forecasting at the Selig Center for Economic Growth at UGA’s Terry College of Business.
“The single biggest factor driving the increase in the system’s economic impact is the significant growth in the number of students enrolled in Georgia’s public colleges and universities,” says Humphreys. “Not only are there more students, but they are spending more. And of course, with more students, institutions are spending more to serve them.”
The $9.7 billion “output impact” is a measure of sales in a community. The study calculated spending by each of the system’s 34 institutions on salaries and benefits, operating supplies and expenses ($3.8 billion), as well as spending by students who attend the institutions ($2.6 billion). Of the $9.7 billion total, $6.4 billion (66 percent) is initial spending by the institutions and students; $3.3 billion (34 percent) is the multiplier effect of those dollars as they are spent again in the region. Humphreys found that, on average, for every dollar of initial spending in a community by University System institutions, an additional 52 cents was generated for the local economy hosting a college or university.
At UGA, spending on salaries and benefits, operating supplies and expenses was $941 million; student spending accounted for $376 million. Of UGA’s $2 billion impact, $1.3 billion is initial spending by the university and its students.
Another component of the study is the analysis of the employment impact of all 34 institutions on their host communities. The impact on jobs is significant, accounting for $4.4 billion in salaries and wages for 106,831 full- and part-time employees system-wide.
Approximately 62 percent of these jobs are off-campus positions in either the private or public sectors and 38 percent are on-campus employees of the University System.
The study found that on average, for each job created on campus, there are 1.7 off-campus jobs that exist because of spending related to the institution. Jobs related to the University System account for about one in every 36 Georgia jobs. In the Athens area, UGA is responsible for more than 22,000 full- and part-time jobs-more than 10,145 on-campus jobs and more than 12,313 off campus that exist because of institution-related spending. These jobs account for more than $9 million in salaries and wages.
“This Economic Impact Report continues to be an invaluable study,” says Joy Hymel, executive director of the University System’s Office of Economic Development. “It conclusively demonstrates that beyond the almost incalculable benefits colleges and universities offer communities through a more educated society, cultural opportunities and other activities, our campuses have an ongoing and powerful economic impact on communities large and small.”
This is the first year the study did not include the economic impact of construction projects on the University System’s campuses. Because of this change, some University System institutions may show a decline in overall economic impact, despite the fact there may have been a significant increase in enrollment between the two studies.