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Education economics

The economic clout of the higher-education sector in New York and elsewhere is no secret. Less commonly known is its growth rate, which continues to be nothing short of remarkable.

A new report prepared by the Center for Governmental Research Inc. for the Commission on Independent Colleges and Universities underscores this fact. It shows that from 2011 to 2013, the total annual economic impact of New York’s private institutions of higher education grew nearly 18 percent, to $74.3 billion. And since 2005, the figure has grown by roughly $33 billion—an increase of nearly 80 percent.

Independent Finger Lakes colleges and universities have played a key role. The study found that they produced an economic impact of $5.6 billion, which is more than in any region outside of New York City.

The region’s eight schools—led by the University of Rochester and Rochester Institute of Technology—employed almost 40,800 people with a payroll of $3.1 billion. Enrollment topped 42,000, with some 40 percent of students coming from out of state.

While private colleges and universities are non-profit institutions, their employees regionally paid $224 million in taxes.

UR president Joel Seligman has made the point that the university “cannot be an ‘economic savior.’” But there’s no doubt that, as the regional economy has dealt with wrenching changes brought on by the dramatic downsizing of its traditional manufacturing employers, the education sector has helped greatly with the transition.

It’s important to note that the benefits have not spread evenly throughout the population, however. Those who lack a college education—let alone a job in the education sector—are much more likely to be poor. In the city of Rochester, the poverty rate for those with a high school diploma but no college is more than 25 percent; it falls to less than 10 percent for those with at least a bachelor’s degree.

Clearly, this region is fortunate to have such a robust group of independent colleges and universities. If only that were enough to lift all boats here.

2/6/15 (c) 2015 Rochester Business Journal. To obtain permission to reprint this article, call 585-546-8303 or email rbj@rbj.net.

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