CEDAR FALLS — Iowa’s public universities provided $11.8 billion in additional income to the state in the 2017-18 budget year, equaling 6.2 percent of Iowa’s gross state product, research commissioned by the Board of Regents and unveiled Thursday shows.
The economic impact report — conducted by Idaho labor market analytics firm Emsi — found Iowa public university activity supports nearly 150,000 jobs, or one in every 14 jobs in the state.
For every taxpayer dollar spent, the regent system returned nearly $3 in added revenue and public sector savings. The return on a dollar for students — in the form of lifetime earnings — was $3.70, according to the report, which also found a $4.50 “society” return per dollar.
“I think this is a message that we really need to get out to the public,” regent Nancy Boettger said after Emsi’s Assistant Director of Higher Education Consulting Hannah Ruffridge presented the findings during the board’s meeting at the University of Northern Iowa.
“The universities’ commitment to quality, affordable education produces tangible benefits to Iowans in all 99 counties,” regents President Mike Richards said, noting the information will help the board plan and focus resources, which have become strained.
The state’s portion of the public higher education budget has shrunk over the years, with lawmakers recently pulling back committed appropriations midyear during statewide shortfalls, and then not fully restoring the cuts later. The state ended fiscal 2019 with a $289 million surplus.
Funding woes for the public universities have prompted the campuses to close centers, end scholarship programs, freeze faculty pay, increase class sizes, raise tuition and investigate new partnerships, collaborations and outside funding opportunities.
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The University of Iowa, for example, is considering partnering with a private company to operate its utility system in hopes of securing a hefty upfront payment it could place in an endowment.
Iowa’s three public university presidents annually make an appeal to lawmakers for more money for higher education. Findings from the new study could bolster their arguments.
“The regents system brings value to Iowa in numerous ways,” Richards said. “Be it through the higher earnings of our graduates, the many public services our institutions provide, or the research our universities perform.”
When looking at each university individually, the UI in the 2017-18 budget year added $6.5 billion in income to the Iowa economy, according to the report. That’s equal to 3.4 percent of the state’s total gross product and amounts to 81,073 jobs.
“For perspective, the activities of UI and its students support one out of every 26 jobs in Iowa,” according to the report, which found the UI employed 10,443 full- and part-time faculty and staff in the year studied — excluding hospital, clinic and research employees — amounting to a payroll of $988.3 million for those employees.
Iowa State University in the 2017-18 year added $3.4 billion in income to Iowa’s economy, amounting to 1.8 percent of the state’s total gross product and supporting 42,640 jobs.
UNI added $1.6 billion to the Iowa economy, equal to nearly 1 percent of the state’s gross product or 21,979 jobs.
Graduates of Iowa’s regent universities working in the state accounted for $6.2 billion in income, according to the report, which also tallied direct and indirect benefits to students. UI, ISU and UNI alumni earned $2.4 billion in net labor income above their non-college-going peers.
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Students who get a bachelor’s degree at one of the three universities and work in Iowa earn an average of $54,000 a year — about $22,500 more than those without degrees. Alumni with master’s degrees earn $13,100 more than those with bachelor’s degrees, and students with doctorates or professional degrees “enjoy even larger bumps.”
“Alumni from Iowa’s public universities graduate with the knowledge and skills necessary to attain higher-paying jobs than those who don’t attend,” Richards said.
In breaking down ways the universities benefit to Iowa, the report found a $1.9 billion operations spending impact; a $132.7 million construction spending impact; a $1.5 billion spending impact from UI Health Care; and a $730 million research spending impact.
Regent-related visitors spent $38.1 million in the year studied, and students spent $232.9 million, the report found.
The report didn’t quantitatively measure extension and outreach activities, although it did find more than 13,000 companies and organizations have benefited from university extension and outreach offices — in addition to tens of thousands of Iowa farmers, according to a summary of the report.
The board paid $118,000 to commission the study.
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