The University of Georgia was a stabilizing economic force for the Athens area in fiscal year 2009, pumping more than $2.2 billion into the local economy, according to a new study from UGA's Selig Center for Economic Growth.
The study, which measured the economic impact of all 35 institutions in the University System of Georgia, showed that UGA spent nearly $633 million in salaries and $337 million in operating expenses from July 1, 2008-June 30, 2009, and that UGA students spent an additional $436 million in and around Athens.
Despite a weaker economic climate, the university actually contributed more money to the Athens-area in fiscal year 2009 than in the previous year, said Jeff Humphreys, director of economic forecasting for the Selig Center in the UGA Terry College of Business.
"The recession has had a big impact, particularly on expenditures by the institutions themselves because of cutbacks in state spending for personnel and operating expenses, but it seems like it hasn't because the numbers keep growing," Humphreys said. "The numbers are bigger this year because of more students and more faculty grants and contracts.
"Even spending by students has been affected," Humphreys said. "Not including tuition and fees, each student spent about $6,400 per semester. That number would be significantly higher if not for the recession. And even though we have fewer faculty this year, we have more contracts and grants, so there are other sources of income besides state government that have helped."
The study showed that for every $1 spent by UGA, $1.51 was added to the regional economy.
But the real economic impact of UGA may be best understood by how it affects employment, Humphreys said. During the time period studied, UGA created or maintained 19,582 jobs in the area. But for each job created on campus, there are 1.6 off-campus jobs that exist because of spending related to the university.
Taken as a whole, the University System of Georgia contributed more than $12.7 billion into Georgia's economy and was responsible for 112,336 full- and part-time jobs (2.8 percent of all jobs in the state), according to the study.
"This year, the job impact was a little higher than last year. In FY09 the job impact for UGA was 19,582, whereas last year it was 19,415," Humphreys said. "Although the study does not specifically investigate why the job count did not go negative in FY09, I can speculate that Georgia's revenue collections and state appropriations lagged the economic cycle. The 2007-2009 recession bottomed out at the tail end of FY09, but even though the recession was over both revenue collections and state appropriations continued to decline. Thus, on-campus job losses due to the 2007-09 recession will rise even as the Georgia's overall economy recovers. This is the normal pattern that many state agencies see after recessions. And because this recession was severe, the post-recession job losses will likely be more intense."
Humphreys uses a variety of statistical data from the USG Board of Regents, the state government and local indicators to determine the impact of UGA and the other institutions.
One aspect that isn't included, however, is the impact that visitors to the university have on the economy, Humphreys said.
"I would love to include visitor spending at each institution," he said. "We all know there're a lot of people who come to Athens who are not students but they-alumni, parents, friends of students and faculty, conference attendees-come to visit because of the institution, and none of that is included."
The study, which was commissioned by Georgia's Intellectual Capital Partnership Program, is reported annually by the UGA Selig Center for Economic Growth.