1 The Economic Impact of San Antonio's Institutions of Higher Education h Sponsored by the Higher Education Council of San Antonio
2 Higher education in San Antonio is represented by a broad range of institutions including community colleges, four-year universities, a medical school, a major research university, and several schools of theology. These institutions serve the community by providing affordable access to two-year and four-year degrees, nationally recognized liberal arts programs, cutting edge research, quality workforce development and training programs, and contributions to the rich cultural life of San Antonio, the nation s seventh largest city. The Higher Education Council of San Antonio (HECSA) promotes and develops higher education in San Antonio and Bexar County through inter-institutional collaboration and engagement with the business, cultural, political, and K-12 leadership of the community. This study was commissioned by HECSA and conducted by The Center for Community & Business Research Institute for Economic Development UTSA Downtown Campus UTSA study team: Mark Hager, Gary Bridges, Robert McKinley, and Minerva Garcia Highlights In 2004, the economic impact of higher education institutions on San Antonio was $2.2 billion, representing three percent of the local economy. The ten largest colleges and universities and their students spent $1.5 billion in The "multiplier effect" from direct spending resulted in nearly $800 million in secondary expenditures. San Antonio s colleges and universities enrolled more than 100,000 students in The ten largest universities and colleges account for 89 percent of the students. The ten largest colleges and universities employed 17,000 faculty and staff with a payroll of $702 million. When secondary spending is taken into consideration, higher education institutions contributed to an estimated total of nearly 25,000 jobs. Trinity University, founded in 1869, is one of the nation s top private undergraduate institutions. Noted for its superior academic quality, outstanding faculty, and exceptional academic and residential resources, Trinity is committed to the intellectual, civic, and professional preparation of its students. Trinity annually enrolls approximately 2,700 students who come from 46 states plus 25 countries. The University has 228 full-time faculty members, 98 percent of whom hold doctoral or terminal degrees in their field. The student/faculty ratio is 10:1. Trinity offers 37 majors and 13 interdisciplinary minors. In addition to strength in the liberal arts and sciences, these majors include pre-professional programs in communication, education, business administration, engineering science, and computer science. Degrees offered include the Bachelor of Arts, Bachelor of Science, and Bachelor of Music. Two five-year programs lead to a bachelor's degree followed by a master's degree in teaching or accounting. Additionally, Trinity offers the Master of Arts degree in school administration and school psychology, and a Master of Science degree in health care administration. Visit
3 Introduction San Antonio colleges and universities directly contribute to the human capital of our city and state. Higher education is an investment that results in long-term economic benefits, including productivity and earnings gains of an educated workforce, new knowledge creation, new products and services that come from research and development, a supply of skilled professionals to meet labor market demands, and an improvement in the general quality of life. Number of Students, 2004 Enrollments in San Antonio Institutions. The San Antonio area receives a range of economic benefits from having a variety of vibrant colleges and universities. Universities purchase goods and services from businesses that in turn employ more citizens and purchase goods and services from other local businesses. These expenditures represent the multiplier effect of the university s expenditures. This same multiplier effect is also reflected in the university s expenditures on construction and capital improvements and in the expenditures of faculty, staff, and students on local goods and services. The research presented in this brochure was conducted in consultation with HECSA to document the economic impact of higher education on the San Antonio area. The 10 largest colleges and universities provided detailed information on their expenditures in 2004, their enrollments, and the number of students that came from outside the San Antonio area. Source: U.S. Department of Education, Integrated Post Secondary Education Data System, plus self reports from Universidad Autónoma Guadalajara and Universidad Nacional Autónoma de Mexico. In this study the San Antonio area is defined as the San Antonio Metropolitan Statistical Area (MSA), which includes Bexar, Atascosa, Bandera, Comal, Guadalupe, Kendall, Medina, and Wilson counties. Northwest Vista College, which opened in 1995, is part of the Alamo Community College District. Northwest Vista has been ranked one of the fastest growing midsize community colleges in the nation. Located at 3535 N. Ellison Drive, next to SeaWorld of Texas, Northwest Vista College s expanding agreements with business and higher education partnerships provide a wealth of opportunities for students and the community. Visit San Antonio College is the largest single-campus community college in Texas, with an average semester enrollment of 21,000 credit students. SAC responds to community needs by providing high quality general education, liberal arts and sciences, professional, technical and continuing education, as well as developmental education. A fully accredited two-year community college of the Alamo Community College District, SAC is committed to helping students reach their full potential by developing their academic competencies, critical thinking skills, and communication proficiencies. Visit
4 Overall Economic Impact, $2.2 billion The research focuses on impacts from four different kinds of categories of expenditures. Three comprise the majority of college or university spending: Operational, such as academic support and student services Capital, such as construction and improvements Faculty and staff salaries Different kinds of impacts The study also considers a fourth category of non-resident student spending in the community. Out of more than 90,000 students reported by the 10 colleges and universities, 19,847 came from outside the San Antonio area. While attending school, these non-resident students generated new economic activity by renting apartments, purchasing amenities, and eating in local restaurants. They are included in the study. Local area students were excluded from the analysis because they would be making local expenditures even if they were not attending college. Twenty years ago, the opening of Palo Alto College was the realization of a community dream to build an institution of higher learning in the Southside of San Antonio. Since then, Palo Alto College has provided exemplary, accessible education and training to a diverse and aspiring community. Visit The University of Texas at San Antonio is one of the premier institutions of higher education in South Texas and one of the fastest growing universities in the state. One of nine universities and six health institutions in the UT System, UTSA is the second largest in the system. Celebrating its 36th anniversary, UTSA serves more than 28,000 students enrolled in 62 bachelor's, 43 master's, and 19 doctoral degree programs. A university of access and excellence, UTSA is an Hispanic-serving institution committed to research and discovery, teaching and learning, and public service. Visit University spending on operations, capital improvements, and salaries, as well as student spending in the community, represents direct economic impacts. The University of Texas Health Science Center at San Antonio is the leading research institution in South Texas and one of the major health sciences universities in the world. With an operating budget of $500 million, the Health Science Center is the chief catalyst for the $14 billion biosciences and health care industry. The Health Science Center has had an estimated $34 billion impact on the region since inception and has expanded to six campuses in San Antonio, Laredo, Harlingen, and Edinburg. More than 20,500 graduates (physicians, dentists, nurses, scientists and allied health professionals) serve in their fields, including many in Texas. Health Science Center faculty are international leaders in cancer, cardiovascular disease, diabetes, aging, stroke prevention, kidney disease, orthopaedics, research imaging, transplant surgery, pain management, genetics, nursing, allied health, dentistry, and many other fields. For more information, click on Direct spending yields secondary impacts, such as when construction companies purchase supplies from other businesses, faculty and staff spend their salaries on homes and retail goods, and non-resident students rent apartments and eat at local restaurants. The combination of direct and secondary impacts is typically referred to as total economic impact. The direct and secondary impacts yield the overall monetary economic impact on the area. Spending can also be represented as direct and indirect jobs supported. Secondary impacts and numbers of jobs are derived by IMPLAN, a widely used input-output modeling software used for estimating economic impact.
5 Total Economic Impacts Total Jobs Generated The colleges and universities in the study spent $359 million on goods and services, $188 million on capital expenditures, and $702 million on payroll and benefits. These direct expenditures total $1.3 billion. The additional $212 million in student spending is the product of 19,847 non-local students spending an average approximate $10,698 in In sum, direct expenditures totaled $1.5 billion. Spending on operations and capital improvement supports other local and non-local businesses that pay employees and purchase additional goods and services. That first round spending results in an additional $231 million from operations and $137 million from capital expenditures. University employees and students spend money in the local area for housing, food, services, and other items, resulting in $280 million and $121 million in secondary spending, respectively. These secondary expenditures total nearly $800 million in subsequent rounds of spending, and are sometimes referred to as the "multiplier effect." Total economic impact is the sum of direct and secondary expenditures. Total economic impact for the universities and colleges in the study, along with the spending of their nonlocal students, reached $2.2 billion in Economic impact can also be conceptualized as the number of jobs supported by spending by the colleges and universities and their non-local students. Expenditures from operations ($591 M) generated 7,809 jobs. The greater expenditures for faculty and staff salaries ($982 M) generated fewer jobs (7,564), reflecting higher pay and greater benefits among college and university employees. Total jobs generated in 2004 by higher education institutions in the study is 24,851. This accounted for 3.3 percent of nonfarm jobs in the area. However, the percentage of abovemedian wage professional jobs is much higher. Cited as a national model for student success by The Education Trust, St. Mary s University, a Catholic and Marianist liberal arts institution, ranks in the top 10 for high graduation rates among public and private colleges in Texas. St. Mary s, the oldest Catholic university in the Southwest, is home to the only Texas Catholic law school, and the Bill Greehey School of Business, the only Catholic business school in the state accredited by the nation s premier business school accrediting agency. St. Mary s students receive personal attention from some 200 full-time faculty members, 90 percent of whom have terminal degrees, and learn from powerful programs in more than 44 different areas, in addition to pre-professional programs in medicine, nursing, dentistry, pharmacy, allied health, and law. Visit
6 Methodological Details The purpose of this study was to provide an estimate of the short run economic impacts on the San Antonio economy by the major institutions of higher education, defined as colleges and universities with at least 2,500 students. San Antonio is defined as the Metropolitan Statistical Areas including Atascosa, Bandera, Bexar, Comal, Guadalupe, Kendall, Medina, and Wilson counties. The first part of our analysis required us to estimate the direct expenditures within the region. These direct impacts were measured for the 2004 fiscal-year comprising September 2003 through August The data for estimating the economic impacts of the higher education institutions in the study were derived from financial statements, budget data and other information provided by each university. The multiplier effect was then measured for each one of these direct economic impacts through the IMPLAN Input/Output model, a widely used model first developed by the United States Forest Service in 1979, and now marketed by Minnesota IMPLAN Group. The latest available IMPLAN benchmark data (2003) were used for this report. The model utilizes benchmark tables provided by the Bureau of Economic Analysis as well as other statistical data to model transactions occurring within a region, state or the nation. IMPLAN is, in a sense, a general accounting system of the economic transactions taking place between industries, businesses (universities), and consumers in an economy and estimates the impacts on total output (sales), personal income, taxes, and employment. By expanding their analysis beyond the direct impacts, IMPLAN provides a more complete picture of the economic effects of transactions. Our Lady of the Lake University (OLLU), founded in 1895 by the Congregation of Divine Providence, provides academic programs and cultural experiences that prepare graduates for the changing economy. Students in the University s dual-language degree programs are prepared to work in both English and Spanish-language settings. The University offers 56 bachelor s degrees, 48 master s degrees and two doctoral degrees in the arts, sciences, business, education, professional studies, and social work. Visit
7 OPERATIONAL EXPENDITURES All expenditures were derived from the FY2004 financial reports provided by each institution in the study. All categories were allocated to single or aggregated IMPLAN sectors except for salaries and related costs, bad debt and federal pass-throughs. Salary and wage-related costs were analyzed separately under faculty and staff spending. Model local purchase coefficients, which are estimates of the proportion of goods or services that can be purchased in the study area, were utilized for each sector or aggregated sector. CAPITAL EXPENDITURES Data included expenditures on construction, equipment, vehicles, and books/art. Construction expenditures were taken only from data for "construction in-progress" during the year. The IMPLAN model estimates local and non-local expenditures based on the underlying industry makeup of each region and the propensity to buy across industries. The model local purchase coefficients were applied to each sector in the analysis. The direct expenditures for capital were then modeled in IMPLAN to estimate the additional impacts to the area economy. FACULTY AND STAFF SPENDING In order to estimate the economic impacts of faculty and staff spending, the direct salary and wage expenditures were first extracted from the FY2004 financial reports. These total expenditures were then discounted by 15 percent to account for disposable income. The remaining amount was then applied to the median household range for the MSA. IMPLAN models households as institutions (basically like an industry) based upon benchmarks of consumer expenditures provided by the Bureau of Labor Statistics. Secondary expenditures were derived from the model results. Founded in 1881, the University of the Incarnate Word (UIW) has a 125-year tradition of academic excellence. UIW is the largest Catholic university in Texas and the fourth largest private institution in the Lone Star State. The university offers a variety of programs including theatre arts, nuclear medicine, fashion design, meteorology, nutrition, computer graphic arts, nursing, and pre-pharmacy. Visit Founded in 1898, St. Philip s College is a comprehensive, public community college whose mission is to provide a quality educational environment which stimulates leadership, personal growth, and a lifelong appreciation for learning. The college offers programs in Arts, Sciences, and Technology, and is currently serving over 9,000 students at the main campus, Southwest Campus, and Northeast Campus. Unique in its history, St. Philip's College is designated as both a Historically Black College and Hispanic Serving Institution. Visit STUDENT EXPENDITURES Student spending was estimated in the following manner. First, the number of students for Fall 2003 and Spring 2004 was obtained from each institution in the study. Students were classified by the university as originating from within the MSA or from some place outside of it. While an argument can be made that had the institution not been located within the region, prospective students would have been forced to move elsewhere to attend school, the current analysis assumes that only the students who moved into the local region to attend school have an impact on the local economy since they are bringing new money into the region to spend on local goods and services. By multiplying the number of out-of- MSA students by average expenditures, we were able to estimate the total expenditures spent within the local area. Average annual expenditures per student is estimated at $10,698. The average estimated expenditures for students at all UT System institutions has been determined by previous research to be $10,698 per academic year ($1,189 per month), which represent only personal expenses above and beyond those paid to the university for tuition, fees, books, etc. These estimates were then compared to the consumer expenditure data for the lowest income individual for the southern region in the Bureau of Labor Statistics estimates. Based on this comparison, we judged the UT System estimate to reasonably represent typical spending in the San Antonio area. By multiplying the number of out-of-region students by the estimated expenditures, we have a total estimated direct expenditure of goods and services by students originating from outside the institution s home region. This represents new money coming into the region. These direct expenditures were then allocated to IMPLAN sectors for estimating the secondary impacts of student expenditures. The resulting figures give an estimate of the impact of student spending on the area economy from students originating from outside the MSA. These expenditures represent new resources coming into the local economies due to attraction by local colleges and universities.
8 Members of the Higher Education Council of San Antonio (HECSA) Alamo Community College District Baptist University of the Américas McNay Art Museum Northwest Vista College Northeast Lakeview College Oblate School of Theology Our Lady of the Lake University Palo Alto College St. Mary s University St. Philip s College San Antonio College San Antonio Museum of Art Southwest Baptist Theological Seminary Southwest Foundation of Biomedical Research Southwest Research Institute Texas A&M University-Kingsville System Center-San Antonio The University of the Incarnate Word The University of Texas at San Antonio The University of Texas Health Science Center at San Antonio The University of Texas Institute of Texan Cultures The Witte Museum Trinity University Wayland Baptist University U.S. Air Force School of Aerospace Medicine Universidad Autónoma Guadalajara Universidad Nacional Autónoma de Mexico h