Download Economic Development - University of Missouri

The Statewide Economic Impacts of
the University of Missouri
Tom Johnson
August 2007
What is Economic Development?
1. Temporal dimension
–
Short-run versus Long-run
2. Spatial dimension
–
Where development occurs
3. Quality dimension
–
Stability, sustainability, and quality of life
Short-run Versus Long-run
Short and Long run often confused
Very different causes and consequences
•
•
•
•
Short Run
Spending
Consumption
Consumer confidence
Stability
•
•
•
•
Long Run
Saving
Investment
Productivity
Change
Spatial Dimension of
Development
Quite distinct local, regional, state, national and
global causes of economic development
These, too, are often confused
Local development
Spending
Inward investment
Industry attraction
In-migration
Exports and local multipliers
Global development
Saving
Investment
Industry creation
Population growth
Specialization & trade
How does the University
contribute to development?
It contributes on all these dimensions and in
all these ways.
In the short-run the University:
• Is a very large economic engine, employing
and producing, selling and buying
• Contributes to the state and national income
and production
• Is a major exporter, selling its education
product nationally and globally
In the local, regional and state
economy the University:
• Contributes thousands of high quality, high
paying jobs directly and indirectly.
• Indirectly pays taxes that provide public
services to all residents.
• Generally offers continued growth and
stability to the local economy
• Attracts new employers and residents
Annual Revenues ($2.1 B)
Grants &
Contracts
14%
Gifts & Others
7%
Sales &
Services
36%
Tuition &
Fees
23%
Federal
Approps
1%
State
Approps
19%
Annual Expenditures ($2.1 B)
Academic &
Student
Services
10%
Other
6%
Instruction
23%
Research
12%
Auxiliary
Enterprises
37%
Operations
4%
Public
Service
8%
Economic Impacts of UM
Operations and Capital Investments
• Because of its strong linkages with the state
economy and its creation of good jobs and
income UM has a strong multiplier effect
• Over 60,000 jobs created
• $2.4 Billion contributed to GDP
• 1.1% of the Missouri economy
Economic Impacts including
Students
• 62,000 students
• $.6 Billion non-tuition expenditures annually
Total Impacts
• 68,000 jobs
• $2.7 Billion contribution to GDP
• 1.3 % of total economy
• Almost 4 times the state appropriations to the
University
But it is the long-run
developmental impact that is the
university’s greatest contribution
In the long run
• The only real long run investments are in
knowledge and our ability to generate knowledge
– Knowledge is generated by research
– Knowledge resides in people
– Knowledge is made available through education and
extension
– Knowledge results in productivity
– Knowledge comes from every discipline, from every
art, and from every science
In terms of quality of economic
development the University:
•
•
•
•
Prepares people for change
Foments innovation
Encourages diversity and mobility
Enriches quality of life
These are all part of the quality dimension of
economic development
What role do Universities play in
economic development?
Universities are clusters of talent, tolerance
and technology from which creativity
emerges to lead to high quality regional,
state and global economic development
At the local level the University
• Attracts creative people and offers them a
nurturing social and intellectual
environment.
• It supports the local economy, providing
direct and indirect jobs, income and tax
base with which the community can provide
amenities demanded by creative people.
At the regional level the
University
Provides knowledge spillovers, technical
assistance, trained labor force, innovative
graduate students, research facilities,
learning facilities, and much more.
At the state level the University
• Provides regionally appropriate technology,
educational programs, educated labor force,
and cultural experiences for residents.
• Provides an in-state node in a global
network of research and learning.
• A source of intercultural experience for
residents which will prepare them for a
global economy.
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•
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Economic development is more than:
Local jobs and income
Rising research budgets
Technological breakthroughs and patents
or
Growing numbers of graduates
The University’s contribution to
economic development is also
• Creative and entrepreneurial students and faculty.
• Students and faculty that are engaged in local,
national, and international learning and creative
networks.
• Graduates familiar with interdisciplinary research
and learning.
• Graduates who are comfortable with change.
• A diverse, national and international student body,
learning and creating together.
Every college, school, department, center,
institute, and program at the University has
a role to play in economic development.
Thank you