UR boasts $300 billion impact on economy

(photo courtesy of the University of Rochester).

University of Rochester’s total fiscal impact on the economy was nearly $300 billion in 2019, with a local impact of more than $85 billion, a new report from the Center for Governmental Research Inc. shows.

UR is a major contributor to the upstate economy, directly employing roughly 32,500, with an estimated 28,000 full-time equivalents. Through spillover spending and its other economic impacts, its total employment impact is nearly 68,000, with earnings of $4.7 billion.

The university and medical center is the largest private employer in Upstate New York and the seventh-largest statewide, the report shows. The same report shows that Wegmans Food Markets Inc. is the 15th largest private employer statewide, while Rochester Regional Health System is the 19th. Most of the rest of the top 20 employees reside in New York City.

Courtesy of CGR

UR and its affiliates expanded their overall headcount by roughly 1,700 workers, a 5 percent increase from 2017 employment levels. CGR estimates the aggregate employment impact of the University as totaling nearly 68,000 jobs, an increase from 64,000 in 2017. Spillover employment is spurred by the employment and other activities of the university and includes external spending by the university on goods and services.

In 2019, UR paid wages of $2.2 billion to employees living in New York State. With spillover wages included, that rose to $4.7 billion in income in New York State, an 18 percent increase from 2017.

Courtesy of CGR

UR and its affiliates purchased goods and services totaling some $1.3 billion in 2019. Of this total, $317 million or 24 percent was spent in New York State, a 6 percent increase from 2017 spending.

During the past five fiscal years (FY2015 – FY2019), UR and its affiliates made more than $1.6 billion dollars in capital project expenditures, adjusted for inflation, according to the report. This averages to roughly $324 million in capital investments per year.

CGR estimates that spending by students totaled roughly $88 million in 2019. This spending supports in total roughly 2,460 jobs in the New York state economy and $90 million in total labor income.

Finally, another way UR is an economic engine involves the attraction of visitors who spend money while here. The University of Rochester hosts visitors throughout the year for events such as Meliora weekend, commencement, concerts, recitals, athletic events and admissions visits. Visitors to these events are a vital source of economic impact because they bring new dollars to the New York state economy, the report states.

Some 430,000 people attended a UR event in 2019, and an estimated 40,000 people were out-of-town visitors. They lodged more than 35,000 nights in local hotels. During 2019, CGR estimates visitors to UR spent nearly $9 million on food, lodging and gasoline, resulting in roughly 107 jobs and $4.7 million of labor income to the state economy.

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Center for Governmental Research names new leader

The Center for Governmental Research Inc. has named longtime CGR Principal Erika Rosenberg as president and CEO. Rosenberg succeeds Joseph Stefko, who left the agency last month to become president and CEO of ROC2025, a new strategic alliance focused on transforming the Greater Rochester region.

Erika Rosenberg
Erika Rosenberg

Rosenberg joined CGR in 2005 following a career in journalism that included posts at the Democrat and Chronicle and Gannett News Service in Albany. During her 14 years with CGR, Rosenberg has led the organization’s expanding portfolio of work with nonprofits and foundations in community indicators, evaluation, asset mapping and landscape scans, among other things.

“Erika embodies CGR’s mission of improving communities through data, analysis and consultation,” CGR Chairman Victor Salerno said in a news release. “With more than a decade of experience as a researcher, project director and practice area leader at CGR, she hits the ground running and will do a terrific job leading CGR into its next phase of impactful community work.”

Rosenberg has directed a variety of projects critical to communities, including CGR’s study of the city of Rochester’s Civilian Review Board, which helped the city evaluate options for increasing police accountability, as well as a partnership with the United Way of Greater Rochester Inc. that helped frame community needs and possible investment strategies for the future.

Her work has helped extend CGR’s footprint beyond New York and into Massachusetts, Pennsylvania, Delaware, Tennessee, Florida and Arkansas.

“I’m honored to be chosen to lead such a respected and valued organization,” Rosenberg said. “CGR’s commitment to high-quality analysis, straightforward presentation of the facts and insightful consultation is what drew me to join the organization. I’m excited to work with our team and leaders and community members in Rochester and the other areas we serve to broaden our reach, increase our impact and help communities solve problems and improve quality of life for their residents.”

CGR was founded by George Eastman in 1915 and is an independent, nonprofit management consulting organization that offers expertise in government and education, economics and public finance, health and human services and nonprofits and communities.

[email protected] / 585-653-4021
Follow Velvet Spicer on Twitter: @Velvet_Spicer

Report: UR’s economic impact continues to grow

Lattimore Hall on the University of Rochester's River Campus. (Photo by Brandon Vick, University Communications)
Lattimore Hall on the University of Rochester’s River Campus. (Photo by Brandon Vick, University Communications)

The figures describing the University of Rochester can seem staggering.

  • $1.2 billion in annual payroll for 30,800 employees.
  • $3.2 billion total pumped into the economy in the form of that payroll plus the wages of people whose jobs depend on UR business or the spending of its employees in one year.
  • $327.9 million in capital investment in 2017 alone.
  • The largest private employer in all of Upstate New York, and the fifth largest for the entire state.
  • $342 million in research grants in 2017.

In one very large nutshell, those figures spell out the economic impact of the University of Rochester, documented in a biennial economic report compiled by the Center for Governmental Research and released this week.

Besides many impressive numbers, the report describes a community enriched by a thriving research university with a regional medical center.  It describes a medical system that has grown organically and through acquisitions, reaching into the Southern Tier. It draws a picture of an active research community, including the federally funded Laboratory for Laser Energetics that attracts scientists from around the world to visit, study and, yes, spend money.

UR has grown so much, in fact, that some of that growth was either left out of the report (acquisition of St. James Hospital in Hornell, for instance, because it occurred in 2018) or averaged out to avoid overstating its impact. The report’s authors chose to average capital investments over five years rather than taking the banner year of 2017 at face value because it was so much higher than previous years.

The University of Rochester's Memorial Art Gallery. (Photo by Brandon Vick, University Communications)
The University of Rochester’s Memorial Art Gallery. (Photo by Brandon Vick, University Communications)

The numbers may come as a surprise for Rochester residents used to having UR as a backdrop for life in the Flower City.

“Sometimes we overlook the most significant economic development engines in our own backyard,” said Anne M. Kress, president of Monroe Community College and co-chair of the Finger Lakes Regional Economic Development Council.  The report really shows that higher education and medicine are the region’s key economic drivers, she noted.

UR President Richard Feldman said he was surprised to see the amount of student spending, which CGR estimated at more than $99 million last year.  “That was just a bigger number than I realized,” Feldman said. It might not come as a surprise to anyone who happens to be in the Henrietta Target store, however, the week that freshmen and foreign students arrive for the fall semester.

In some instances, though, Feldman noted that UR’s greatest impact is in the dollars it draws from elsewhere. Those dollars can come in the form of major federal grants, or of medical insurance payments from the out-of-staters who come to Rochester for a heart or liver transplant or cancer treatments.

Peter G. Robinson, vice president and chief operating officer of the University of Rochester Medical Center, added, “If you look at Upstate New York and the other cities, I think the University of Rochester stands uniquely as a major draw and mecca for health care.” While Buffalo’s Roswell Center for cancer also has a far-reaching reputation, Robinson noted that UR’s Golisano Center is substantially larger.

If URMC were to go away tomorrow, the report noted, people would still go to other local hospitals to have babies or fix broken limbs. But the influx of economic activity around UR’s medical specialties such as liver transplants, autism research and others would also go away.

Dollars don’t just flow into the community for UR’s medical services, as this week’s jazz events surrounding UR’s Eastman School of Music will attest.

“To have this level of medical care is extraordinary,” Kress said, but overall quality of life is elevated because of UR. “Memorial Art Gallery or Eastman—the level of cultural life that’s here is magnified exponentially because of the University of Rochester,” she said.

Having the university here simply makes Rochester a more attractive community, several observers said.

“The university’s economic impact is also in our people and what they bring, qualitatively as well as quantitatively,” Robinson said. “We are attracting to the community some of the best and the brightest in the country.”

University of Rochester Eastman School of Music's Eastman Theatre is pictured during Meliora Weekend October 9, 2015. (photo by J. Adam Fenster, University of Rochester)
University of Rochester Eastman School of Music’s Eastman Theatre is pictured during Meliora Weekend October 9, 2015. (photo by J. Adam Fenster, University of Rochester)

Some of UR’s economic impact is quite purposeful, from its building of student housing in Rochester’ 19th Ward, across the Genesee River from the River Campus; to its relocation of a business incubator, NextCorps, to downtown; to the expansion of its geographic footprint with medical services and hospital systems.

Of the last, Feldman said, “That enables us to serve the population effectively.” A patient entering one of UR’s affiliated hospitals can receive all the services available in Rochester, but less expensively than if each hospital had to try to mount those services on its own.

Robinson said the UR health system has done some rebranding so patients understand where their medical services come from.

“The Finger Lakes region is our home. You’re going to see us all over the Finger Lakes,” Robinson said.

The report begs the question of whether UR can sustain the growth it has seen over the last decade. Through both acquisition and organic growth, it added 9,000 jobs over the last five years.

CGR Data Analyst Michael Silva, who wrote the report, said, “We saw the UR grow, but it was shocking how much they grew.  Nine thousand jobs—that’s a lot of jobs to add to the area.”

Feldman said the growth is likely to continue, but it’s unclear for how long. Robinson predicted that UR will have another year for building that tops 2017 in the next five years, even as capital investments are more subject to fluctuation than other trends.

“They will continue to be the No. 1 factor in our economy,” said Vincent Esposito, regional director of Empire State Development. But even so, he said the local economy needs both to diversify beyond “traditional ‘eds and meds’” and to better leverage the technology and expertise UR has to develop other sectors of the economy such as data science and photonics and imaging.

You won’t get any argument on that from UR.

“We know that we have an impact on the region,” said Feldman. “It’s in our mutual interest for the region to thrive as well as for us to thrive.”

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