West Virginia University pumps $2 billion a year into the state’s economy, increasing the state’s investment in the University tenfold, a WVU economist told an interim legislative committee Tuesday (Aug. 9).
Speaking to the Joint Commission on Economic Development at the WVU Mountainlair, Randy Childs, an economist with the College of Business and Economics’Bureau of Business and Economic Research, said the University was responsibleeither directly or indirectlyfor creating 28,603 jobs last year.
“These figures clearly show that WVU is a critical piece of the economic picture of West Virginia ,”said WVU President David C. Hardesty Jr., who was on hand for the presentation.”As we have previously pointed out, every $1 invested in WVU turns into $10 going through the state’s economy. This is a tenfold return on the state investment of about $200 million annually in WVU and its affiliates.
“The results of this study show the return to the state is well proven, and further investments will only increase this direct benefit back to West Virginia ,”Hardesty added.”Furthermore, our mission of teaching, research and service has, as its ultimate end, job placement and creation.”
The study on WVU ’s economic impact in 2003-04 is an update of one done in 1999, said Childs, who co-authored the report. It examines the economic activity spurred by WVU ’s main and regional campuses, WVU Research Corp., WVU Foundation Inc., WVU Hospitals Inc., University Health Associates, WVU Alumni Association and WVU ’s portion of NASA programs in the state.
The analysis does not include all University activities that influence the state’s fiscal performance, Childs said. For instance, it does not look at the economic impact of WVU home football games or performances at the Creative Arts Center . It also does not touch on the service efforts of the University’s many volunteers.
“We intentionally took a conservative approach when writing this report,”he said.”The impact of WVU goes far beyond the University’s spending and job creation affecting all 55 counties. WVU ’s research leads to intellectual property, which is transferred to the private sector creating new jobs.
“The Health Sciences Center improves the health of thousands of citizens through its many facilities statewide,”Childs added.”Our historic mission of educating our state’s best students builds the human capital needed to compete in today’s global economy.”
Joint Commission on Economic Development co-chairs Brooks McCabe of Kanawha County and Sam Cann of Harrison County called the report”impressive.”
“The impact of the University on not only north-central West Virginia but the entire state is astounding in terms of the leverage of dollars the state provides,”McCabe said.”WVU is truly a significant economic engine for West Virginia , and the intangibleswhether it’s research funding, enrollment growth, nationally prominent faculty and scientistsindicate the University is truly moving to a level of national respect.
“The magnitude of the work being done here.the momentum.it’s all very heartwarming,”he added.”Not to embrace it, not to proactive in our funding would be a missed opportunity.”
Cann said,”It’s obvious the University has a dynamic impact on the economy of West Virginia , and we need to make sure our policies and practices ensure the continued growth that this institution is experiencing.”
Other highlights of the report:
Business volume$2.01 billion (total); $987.8 million (direct); $1.02 billion (indirect);
Employee compensation -$818.5 million (total); $587.7 million (direct); $230 million (indirect);
Employment28,603 (total); 16,642 (direct for WVU and affiliates); 11,961 (indirect)
Assorted state taxes$46.1 million (total)
The report also notes impressive gains in health-related economic activity associated with WVU .
“We expect this to accelerate even more in the very near future,”said Dr. Robert D’Alessandri, vice president for health sciences at WVU .”The expansion of WVU Hospitals will be complete in a few months, which will mean more patients will get their health care here instead of leaving the state.
“The research plan is gaining speed, which means we are recruiting top scientists and they are bringing outside funds to the University,”he added.”The investments we’ve made in health care, education and research are paying dividends already.”
Using a nationally acclaimed economic modeling methodology, researchers came up with the appropriate economic multipliers to estimate the indirect and total impacts on business volume, employee compensation and employment. Personal income, corporate net income, and business franchise and sales tax revenues generated from the operation of WVU and its affiliates are among the impacts estimated.
The study focuses on direct, indirect and total economic impacts of WVU and its affiliated organizations. Direct impact relates to the organizations’total expenditures and employment based on annual operating purchases and major capital expenses. Indirect impact relates to additional expenditures and employment generated by suppliers and employees spending what they make. Total impact combines the two.
The report gives an overview of WVU and its regional campuses, noting that the University has made significant changes in its programs, expanded academic facilities and increased its enrollment on the Morgantown campus by more than 2,000 students9.1 percentbetween 1997 and 2003. By fall, WVU ’s full-time student growth since 1995 will top 5,000 students.
Enrollment at WVU ’s main and regional campuses total 31,733 students in fall 2003, with estimated student budgets ranging from $6,738 for resident students at WVU Parkersburg to $21,308 for nonresident students in Morgantown, the report indicates.
The researchers also cite WVU ’s growing emphasis on research and its impact on job creation.
“As the leading recipient of federal, state and private research funds in the state, WVU generates substantial economic activity just from its research purchases,”the report states.”Increasingly the research is resulting in intellectual property, which is being commercialized through technology transfer. The end result is the creation of additional employment opportunities for West Virginia-based businesses.”
“Our long-term strategic plan builds on the very solid foundation laid out in this report,”Hardesty noted.”We fully expect WVU ’s economic impact on the state of West Virginia to continue to grow as enrollment increases, annual research dollars rise, and additional jobs are createdespecially through the exciting developments at the Health Sciences Center .”
Copies of the report are available online athttp://www.bber.wvu.edu/