By Sean Olson, University Relations
Dr. Andrew Brod, author of the analysis.
A new analysis finds UNCG’s economic footprint is comparable to that of the High Point Furniture Market and the Moses Cone Health System.
According to the economic impact analysis completed by the Office of Business and Economic Research in the Bryan School of Business and Economics at UNCG, the university’s impact on the Triad economy in 2004-05 was $1.22 billion and its employment impact was 13,520 jobs.
“We have long known UNCG has a profound effect on the area’s economy, injecting hundreds of millions of dollars into the area by way of our students, our purchasing and our employees,” said UNCG Chancellor Patricia A. Sullivan. “This study introduces a new factor – human capital impact – and it gives a more complete picture of the university’s impact on the community, not only in terms of dollars but also in terms of workforce development.”
The economic impact analysis examined four areas:
• UNCG’s operating expenses – or the total purchases and salaries made by the university – account for $426.96 million, 6,669 jobs.
• Human capital impact accounted for $699.04 million and 5,649 jobs, according to the report. This is an estimate of the impact resulting from the additional income of area alumni resulting from a college diploma.
• Student spending impact takes into account what students inject into the economy by way of room and board, books and supplies, transportation, and personal costs. This is estimated to total more than $90.04 million, 1,148 jobs.
• Visitor spending accounts for more than $3.66 million and 54 jobs added to the Triad economy.
• TOTAL: $1.22 billion, 13,520 jobs.
study also separately calculates the economic impact of research
at the university, which is estimated to be $102.02 million in
increased income throughout North Carolina.
“The data show that the overall economic impact of UNCG is in the same ballpark as the impacts of the International Home Furnishings Market in High Point and the Moses Cone Health System,” said Dr. Andrew Brod, director of the office and author of the study.
According to a 2003 economic impact analysis, Moses Cone Health System's regional economic impact was $1.48 billion, 16,322 jobs. According to a 2003 economic impact analysis the High Point Furniture Market had a $1.07 billion impact on the Triad economy and accounted for 13,038.
HUMAN CAPITAL IMPACT
In addition to the traditional factors examined in an economic impact survey – such as overall spending – Brod also considered the main objective of a university: an educated community.
“What is it that makes a university a university? It trains or educates people,” Brod said. “Given that the income of people with a higher-education diploma has been shown over and over again to be higher than the income of people without a diploma, there is a human capital impact.”
According to the U.S. Census Bureau, over the entirety of an adult working lifetime, high school graduates earn, on average, $1.2 million while those who hold a bachelor’s degree earn nearly twice that – $2.1 million.
Thus, Brod calculated the human capital impact of UNCG to be an estimated $699.04 million. UNCG’s operating budget for the study year, 2004-05, was $243.46 million. Of that, the university received $108.06 million in state funds.
The study, which applies economic multipliers in the analysis, was completed using IMPLAN impact planning software in conjunction with data provided by Minnesota IMPLAN Group, Inc. Other data, were collected from sources such as UNCG, the Greensboro Area Convention and Visitors’ Bureau and other entities.
The study area encompasses the 10-county area that makes up the Triad combined statistical area: Alamance, Davidson, Davie, Forsyth, Guilford, Randolph, Rockingham, Stokes, Surry and Yadkin counties.
The EIA studied three separate types of effect: direct effect (dollars directly spent or the number of people directly employed by the university), indirect effect (additional spending or employment generated by business trade), and induced effect (the additional spending generated by businesses serving the households of university students and employees).
Those effects were measured as employment (the jobs created), value added (the gross product of the university), and final demand (akin to gross sales). The last of the three measures is widely considered indicative of overall economic impact.
Brod has completed economic impact analyses on numerous educational and business institutions around the state and the region, including the High Point Furniture Market, the Dell Factory, Moses Cone Health System, and Norfolk State University in Norfolk, Va. His impact study of the Dell factory was instrumental in developing a local government incentive package to lure the company to the Triad.
For more information on this economic impact analysis, contact Dr. Andrew Brod at 336-334-4867 or, via email. To learn more about the Office of Business and Economic Research, visit the web site.