Universities play a crucial role in shaping local economies by driving employment, fostering business growth, attracting investment, and enhancing the overall quality of life in their host communities. Their economic impact extends beyond direct spending to include long-term benefits such as workforce development, innovation, and cultural enrichment. Below, we explore the key ways in which a university influences a local economy.
- Direct Employment and Spending
A university is often one of the largest employers in a local area, providing jobs for faculty, administrative staff, maintenance workers, and other professionals. These employees spend their salaries on housing, groceries, transportation, and entertainment, injecting money into the local economy. Additionally, universities spend significant amounts on construction, utilities, and local services, further stimulating business activity.
Students also contribute to local spending. Many bring outside money into the community through tuition payments, federal aid, and personal expenditures on rent, food, and retail. A large student population can sustain businesses such as bookstores, coffee shops, restaurants, and housing providers.
- Business Development and Entrepreneurship
Universities often serve as hubs for innovation and entrepreneurship. Research institutions, business incubators, and technology transfer offices help commercialize academic research, leading to startup formation and industry partnerships. For example, Stanford University's role in Silicon Valley's growth demonstrates how academic institutions can spur regional economic development.
Local businesses benefit from university partnerships, including procurement contracts for supplies, catering, and maintenance services. Furthermore, universities attract conferences, sporting events, and cultural activities that generate tourism revenue for hotels, restaurants, and transportation services.
- Human Capital and Workforce Development
A well-educated workforce is essential for economic competitiveness. Universities produce graduates with specialized skills that attract high-paying industries, such as technology, healthcare, and finance. Many graduates remain in the area, filling critical roles in local businesses and government.
Universities also offer continuing education programs, professional certifications, and workforce training initiatives that help upskill local employees, making the regional labor market more adaptable to industry changes.
- Real Estate and Infrastructure Growth
The presence of a university can drive demand for housing, both from students and faculty. This often leads to the development of new apartments, condominiums, and mixed-use commercial spaces. Over time, universities contribute to urban revitalization by investing in campus expansions, public transit improvements, and community amenities like libraries and parks.
However, rapid growth can also lead to challenges, such as rising housing costs and gentrification, which may displace long-term residents. Local governments must balance economic expansion with policies that ensure affordable housing and equitable development.
- Cultural and Social Contributions
Beyond economics, universities enrich local culture through arts programs, public lectures, and athletic events. These activities improve residents' quality of life, making the area more attractive to businesses and skilled workers. A vibrant university town often sees increased property values and a more diverse, engaged community.
Conclusion
The economic impact of a university on a local economy is multifaceted, encompassing job creation, business growth, talent development, and infrastructure investment. While challenges such as affordability and displacement must be managed, the long-term benefits-including innovation, increased tax revenues, and a more dynamic workforce-make universities vital engines of regional prosperity. By fostering collaboration between academia, government, and industry, communities can maximize these advantages while ensuring inclusive growth.
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Anabaptist Mennonite Biblical Seminary |
Marian University-Ancilla |
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John Patrick University of Health and Applied Sciences |
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Holy Cross College |
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Goshen College |
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Saint Mary's College |
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Southwestern Michigan College |
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Andrews University |
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Lake Michigan College |
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University of Notre Dame |
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Percent admitted - total Admissions yield - total
Full-time enrollment Part-time enrollment
Total enrollment % White % Black % Asian % Hispanic % Native Hawaiian or Other Pacific Islander % American Indian or Alaska Native % two or more races % Race/ethnicity unknown % U.S. Nonresident
Undergraduate enrollment % under 18 % 18-24 % 25-64 % over 65
Graduate enrollment
Student-to-faculty ratio
Tuition and fees, 2020-21 2021-22 2022-23 2023-24
Total price for In-district students living on campus 2023-24 In-state students living on campus 2023-24 Out-of-state students living on campus 2023-24
In-district students living off campus (no family) 2023-24 In-state students living off campus (no family) 2023-24 Out-of-state students living off campus (no family) 2023-24
In-district students living off campus (w/ family) 2023-24 In-state students living off campus (w/ family) 2023-24 Out-of-state students living off campus (w/ family) 2023-24
Associate's degree Bachelor's degree Master's degree Doctor's degree - research/scholarship Doctor's degree - professional practice Doctor's degree - other
Instructional FTE Research FTE Public Service FTE Librarians, Curators, and Archivists FTE Student/Academic Affairs and Other Education Services FTE Management FTE Business and Financial Operations FTE Computer, Engineering, and Science FTE Community Service, Legal, Arts, and Media FTE Healthcare FTE Service FTE Sales and Related FTE Office and Administrative Support FTE Natural Resources, Construction, and Maintenance FTE Production, Transportation, and Material Moving FTE Total FTE staff
|
12
59
12,590
584
13,174
58
4
5
12
0
0
5
2
14
8,968
1
99
0
0
4,206
9
57,699
58,843
60,301
62,693
83,271
83,271
83,271
83,271
83,271
83,271
65,893
65,893
65,893
0
2,249
1,205
272
165
0
1,379
280
0
108
134
626
1,048
578
440
45
1,223
2
457
11
21
6,352 |
NA
NA
801
2,103
2,904
60
10
1
13
0
0
3
10
2
2,904
31
46
23
0
0
15
4,703
4,860
5,048
5,265
17,727
19,962
19,962
20,195
22,430
22,430
11,011
13,246
13,246
412
NA
NA
NA
NA
NA
54
0
0
2
18
22
8
11
18
0
12
0
53
0
0
198 |
87
24
2,015
822
2,837
22
20
10
19
1
0
3
2
24
1,312
2
86
11
0
1,525
10
31,008
31,782
32,734
33,710
45,960
45,960
45,960
53,776
53,776
53,776
35,910
35,910
35,910
8
312
247
90
12
6
254
0
0
4
18
80
34
19
32
0
48
2
127
26
5
649 |
NA
NA
955
998
1,953
70
12
1
1
0
1
7
7
0
1,953
25
54
21
0
0
17
5,503
5,556
5,768
6,026
18,836
20,174
20,660
17,272
18,610
19,096
9,812
11,150
11,636
244
NA
NA
NA
NA
NA
74
0
0
1
24
24
7
14
22
0
8
2
9
7
1
193 |
81
22
1,450
68
1,518
76
2
1
13
0
0
3
3
1
1,424
1
98
1
0
94
8
45,720
48,010
49,930
51,430
67,180
67,180
67,180
64,630
64,630
64,630
53,330
53,330
53,330
0
326
44
0
9
0
178
0
0
6
14
51
42
14
24
6
60
0
44
10
0
449 |
89
15
680
144
824
49
5
2
27
0
0
3
3
11
773
2
83
15
0
51
9
35,230
35,940
36,660
37,760
53,230
53,230
53,230
51,490
51,490
51,490
41,910
41,910
41,910
0
152
22
0
0
0
80
0
0
7
3
54
8
15
27
1
23
6
31
6
0
261 |
74
20
490
57
547
50
6
1
29
0
0
6
2
5
547
1
90
9
0
0
12
33,250
34,050
34,800
35,500
52,196
52,196
52,196
52,946
52,946
52,946
41,276
41,276
41,276
47
65
0
0
0
0
43
0
0
1
6
24
8
2
19
0
4
0
5
0
0
112 |
100
100
247
159
406
44
15
7
19
0
0
2
14
0
318
0
21
79
0
88
8
16,100
16,100
19,150
19,520
NA
NA
NA
45,022
45,022
45,022
31,422
31,422
31,422
18
45
48
0
0
0
24
0
0
1
0
2
5
0
0
14
0
0
6
0
0
52 |
90
36
215
3
218
58
20
0
12
0
0
6
2
2
218
0
96
4
0
0
10
NA
18,980
19,850
19,850
39,174
39,174
39,174
38,362
38,362
38,362
26,080
26,080
26,080
51
0
0
0
0
0
19
0
0
0
1
13
0
1
7
0
2
0
3
1
0
47 |
NA
NA
24
123
147
35
3
3
7
0
0
1
0
52
0
NA
NA
NA
NA
147
NA
NA
NA
NA
NA
NA
NA
NA
NA
NA
NA
NA
NA
NA
0
0
17
0
0
0
9
0
0
2
1
7
4
1
5
0
0
2
6
2
0
39 |
Sources: STI: PopStats and STI: Colossus
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