Thursday, June 1, 2017

College Towns are Makin' Money

Hayley Nangle
Economics
05/30/17
Reuter

College Towns Are Makin’ Money

Upon graduating high school, many young people choose to attend a college or university that fall. Not everyone, of course, but many. And although college tuition and board and all of that fun stuff restricts a student’s tuition budget, it’s nice to know that not all of the money spent goes to only to the college, but to the college town as well. Thus, the money spent by students and visitors in college towns greatly benefits the local economy and helps allow it to grow and prosper.
One surprising finding, for instance, is that more university-related spending (products, services, etc.) actually creates far more jobs off of campus than it does on campus. According to Jeffrey Humphreys from the Georgia Trend, “on average, for each on-campus job there are 1.4 off-campus jobs. [Which] really [is] not too surprising. After all, the private sector businesses operating in “college towns” are by far the biggest recipients of institution-related spending. Without exception, each institution is an economic linchpin of its host community” (Humphreys). And for those who don’t know what “linchpin” means, it’s just a person or thing vital to an enterprise or organization.
Anway, an even more impressive fact about these college towns is that the schools really demonstrate their economic worth during a recession. Mainly that’s because of the relatively steady demand for higher education, even when the economy isn’t doing so hot. Of course economic activity associated with colleges and universities is not “recession proof” by any means, although it does appear to be recession resistant to some degree. For instance, declines in college-related spending tends to be less than the overall economy, but increases are also less conspicuous. Thus, college towns have a tendency to hold relative stability inside and outside of recessions, also making them more economically stable than other towns.
But the interesting facts don’t stop there! They’ve got some impressive figures, too! College towns can also have statewide economic impacts, like how many of the state’s research universities, regional universities, or larger state colleges receive a decent amount of exposure in the media. On the contrary, however, economic impacts by many state universities and colleges, as well as two-year colleges, receive far less attention. This is especially applicable to colleges and universities not located in a major metropolitan area. Despite this, many of those smaller institutions have large economic impacts relative to the size of their local communities. As for the figures mentioned earlier, Jeffrey Humphreys provided some impressive numbers from example college and university towns of their profits:
“Georgia College and State University, Milledge-ville: The economic impact is $172 million; the employment impact is 1,855 jobs, with 714 on campus and 1,141 off-campus.
Georgia Southwestern State University, Americus: An economic impact of nearly $78 million and 793 jobs.
North Georgia College and State University, Dahlonega: An economic impact of $146 million. There are 472 on-campus jobs and 971 off-campus jobs that exist due to institution-related spending, creating a combined employment impact of 1,443 jobs.
Abraham Baldwin Agricultural College, Tifton: The total employment impact on Tifton’s economy is 1,005 jobs. That includes 373 on-campus jobs and 632 off-campus jobs. The institution’s economic impact on regional output or sales is $81 million.
Dalton State College: The economic impact is $88 million. The employment impact is 949 jobs, including 338 jobs on the campus and 611 off campus.
Middle Georgia College, Cochran: The college supports 838 jobs in Cochran’s regional economy; the institution’s economic impact exceeds $85 million” (Humphreys).

Looking back at this information, one can determine that there is far more full employment in these college towns than unemployment, regardless of whether an individual is a student or local. Furthermore, there seasonal unemployment is relatively brief, as it’s mainly during the student's breaks. If you are one who prefers a visual example, however, Brooklyn Tech provided this little beauty:
college-town-by-the-numbers-brooklyn-tech-triangle.jpg(“Made”).


Works Cited

Humphreys, Jeffrey. "College Towns Reap Benefits." Georgia Trend.
georgiatrend.com/August-2008/College-Towns-Reap-Benefits/.

"'Made in NY" Media Center Announced." Wpengine. Brooklyn Tech Triangle.

brooklyntechtriangle.com/author/wpengine/page/2/.

5 comments:

  1. It'd crazy to see how much college towns depend on college life to bring in revenue. It is also alarming to know that those college towns may enter a recession during college breaks. The stores demand would be lower and they would be higher when the freshmen move in. I could see the unemployment rate fluctuating a lot because they hire college students then they graduate and they have to fill the spot and seasonal unemployment because the students can go away for the holidays and then the owners have no employees to cover their shift.

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  2. I found it surprising that university spending creates many more jobs off the campus than on campus. I guess it does make sense that college students spend a lot of money off campus, but in college towns, students are more likely to stay on campus, since the college is the town. However, it does make sense that the profits are substantial, since colleges typically have thousands of people living there who all require necessities. For this reason, colleges in small towns benefit the town as much as larger colleges do in larger cities, just on a smaller scale.

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  3. I find it interesting just how much a college existing in a town can contribute to its culture, community, and economics. I feel like with places like Madison in particular, this is especially true. While of course there's the government side, a lot tourism and interest in the city can be credited towards the college and its image. If you have a prestigious college in your town, just that can fuel population and ultimately revenue as more and more students move to the area to attend. Besides that, there's also things like sports events that seem to attract consumers.

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  4. I can totally understand the recession that college towns have during summer breaks. Many students go back home to their families, bringing more revenue and economic impact to their hometowns. I also found it surprising that the more positive economic impact there is to the college town, the more off-campus jobs there are. I never thought that the amount of off-campus jobs would change that much.

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  5. It's interesting to see how much of a part colleges play in the cities they're located in. They become integrated into their communities, which makes sense since mostly college students are living on and around the campuses. When college is in session, there are students paying tuition, working jobs, and spending money on other wants/needs. It never occurred to me how much colleges and their communities would be affected when the students go home for the summer, but it does make sense. When the students go home, the cash flow in the college community decreases drastically since they are no longer there to spend and work. I didn't think it would be so dramatic as to cause a recession - it makes you realize how much cities depend on their colleges.

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