The University of Illinois contributes $13.9 billion in annual income to the state’s economy – and a 19.3 percent return on the public’s investment – through spending by its campuses, employees and students and the increased earning power of its graduates, according to a new economic impact study released Oct. 21.
University operations, student spending and alumni pump $4.60 into the economy for every taxpayer dollar invested and also account for about 2 percent of the gross state product, the study by Idaho-based Economic Modeling Specialists International found.
President Timothy L. Killeen announced the study’s findings Oct. 21 during a speech to the Commercial Club of Chicago, a nonprofit membership organization of business, professional and civic leaders who promote the city’s social and economic vitality.
“The University of Illinois influences both the lives of students and the state economy,” according to the study. “The university serves a range of industries in Illinois and supports state businesses, and society as a whole benefits from an expanded economy and improved quality of life.”
The study found that the U. of I. supports nearly 177,000 jobs in Illinois that would not exist without the university – jobs created by the spending of its campuses, students and alumni. The state also benefits from the improved lifestyle of graduates, which provide social savings through reduced crime and unemployment and better health.
Killeen said the study reinforces the university’s key role in moving Illinois forward.
“Our campuses, our students and our alumni are all economic engines for our state,” Killeen said. “They supply the highly skilled workforce that is critical to success in the 21st century and the economic jolt that creates new jobs, new businesses and prosperity.”
The university-commissioned study, based on fiscal year 2014 financial data, found that the U. of I. generates $4.3 billion in annual income for the state’s economy through spending by its campuses and employees. Operational spending for facilities, services and supplies totaled $2.1 billion, while nearly 35,000 full- and part-time employees spent the bulk of a $3.3 billion payroll in-state for housing, food, clothing and other expenses.
Out-of-state students who relocated to Illinois to study at the university contributed $165.4 million in annual income to the Illinois economy for rent, food, transportation and other expenses. About a third of the nearly 86,000 students enrolled in fiscal year 2014 relocated from outside Illinois. The total student enrollment figure includes all students who enrolled over the course of the academic year and is higher than the traditional fall semester student census, which stood at about 80,000 this year.
The university’s most significant impact – $9.5 billion in annual income– stems from the talents that students whom the university has served over time and are active in the state workforce develop through their education, which translate into higher career earnings and increased productivity for Illinois businesses. The study found, for example, that the average bachelor’s degree graduate from the U. of I. will earn $28,800 more annually than a high school graduate, netting about $1.2 million more in career earnings.
On average, the study found U. of I. students receive $3.70 in higher future income for every dollar they invest in their education toward college costs, even factoring in lost wages they would have earned during their college years. This calculates to a 14.7 percent average annual return rate, according to the study by Economic Modeling Specialists, which provides labor market analysis to help organizations improve economic conditions in their regions.
A summary of the study is available online.