EUGENE, Ore. -- (Feb. 22, 2011) - The University of Oregon produces $33.64 in economic impact for every dollar it receives in state appropriations, and accounts for $1 out of every $84 in Oregon's economy, according to the first comprehensive study of the UO's economic reach since 2002.
The university's total economic impact for the 2009-10 fiscal year was $1.97 billion, UO economist Tim Duy found in his study, "The Economic Impact of the University of Oregon." By comparison, the 2002 study by UO economics professor Larry Singell pegged the UO's total economic impact at $703 million for the 2000-01 fiscal year, with the university producing $10 for every dollar of its state appropriation.
But Duy pointed out in his more recent study - prepared in December - that the university's greatest impact on the state economy is the increased earning potential of its graduates. He cites U.S. Bureau of Labor Statistics figures that indicate 25-year-old high school graduates who were employed full-time in 2009 had median weekly earnings of $626, while 25-year-olds with bachelor's degrees had median earnings of $1,025.
"The primary function of a university is to produce human capital," Duy wrote in the study. "Higher levels of human capital raise the productivity of the workforce, an effect that is evidenced by the premium paid to college graduates."
Duy's study indicated the UO also has an immediate effect on the Oregon economy. The university had 5,799 employees during 2009-10, and indirectly supported 13,247 jobs in Oregon, the study said. The UO employs more people than those earning high marks on Oregon Business Magazine's list of the top 150 private companies.
Matthew Knight Arena contributed significantly to a rise in construction spending in FY2009-10 to $177 million, up from $118 million in the previous year. Total UO construction spending contributed $325 million to the state economy, $107 million in household earnings and 2,932 jobs.
UO researchers brought in a record $135.6 million in competitively awarded external funding during the year of Duy's study, and the university's 137 percent growth in research expenditures over the past decade is 11th best among 63 institutions in the Association of American Universities.
The UO generated an estimated $35.5 million in state income taxes, based on total aggregate earnings tied to the university. That offsets the state appropriation of $58.5 million received by the UO, and brings the net cost of the university to the state down to $23 million.
At the time of the 2002 study, the UO received a state appropriation of $71 million.
But according to Duy's study, the decline in state funding has been largely mitigated by an increase in revenue from tuition and fees - fueled by surging numbers of students. The UO's total of $243 million in tuition and fees more than quadrupled the university's state funding for 2009-10.
Duy cited the UO's ability to attract nonresident students as critical in light of declining state appropriations.
"The spending by nonresident students on tuition, housing, food and other expense represents new dollars flowing into the Oregon economy - economic activity that would not take place in Oregon otherwise," he said.
Duy's 15-page study is available online at http://economicimpact.uoregon.edu.
Duy is the director of the Oregon Economic Forum. In addition to annual conferences in Portland and Bend, the Forum produces the UO Index of Economic Indicators, the Central Oregon Business Index, and the Lane County Business Index.
About University of Oregon
The University of Oregon is among the 108 institutions chosen from 4,633 U.S. universities for top-tier designation of "Very High Research Activity" in the 2010 Carnegie Classification of Institutions of Higher Education. The UO also is one of two Pacific Northwest members of the Association of American Universities.
MEDIA CONTACT: Joe Mosley, UO media relations, 541-346-3606, jmosley@uoregon.edu
SOURCE: Tim Duy, UO adjunct assistant professor of economics, 541-346-4660, duy@uoregon.edu