BGSU delivers solid economic benefit to state, study finds

In addition to providing a college education to about 20,000 students a year, BGSU is an economic engine that pumps more than $700 million annually into the Ohio economy, a new study has found.

Michael Carroll of the University’s Center for Regional Development (formerly the Center for Policy Analysis and Public Service), examined BGSU’s economic impact on the state and presented his findings to the board of trustees Dec. 17.

According to his report, “Measuring Bowling Green State University’s Impact on Ohio’s Economy,” BGSU generated more money in tax revenues than it received in state appropriations in 2002. University economic activity created nearly 9,000 jobs for Ohioans.

That year, BGSU received $84.6 million in state appropriations, while the University's economic activity generated $85.9 million in tax revenues. The total economic impact of BGSU on Ohio’s economy was $704 million. “Thus, for every dollar BGSU receives in state support it generates more than $8 in economic activity,” Carroll found.

The combination of state appropriations, tuition and grant revenues is the basis of the $704 million impact on Ohio, Carroll states. If BGSU's impact were calculated nationwide, it would come to $1.3 billion.

While the University’s main business is education, the purely economic benefits to the state cannot be overlooked, said Carroll, who spent a year compiling the report.

Using the University’s audited financial statements from 2002, Carroll, an economics faculty member in the College of Business Administration, looked at the economic impact of University spending for capital improvements and operations; the impact when the University purchases those goods and services from other Ohio businesses, and the economic impact from the wages earned by BGSU employees and students.

Much of the spending by employees and BGSU occurs within a five-mile radius of the University, directly raising the local economy, Carroll said. University-led towns have grown by a factor of eight over non-university towns, he told the board. They tend to be very stable and are a model of how towns would like to be.

Businesses impacted by the University range from farming to retail stores, health providers, all types of food services, construction industries, transportation concerns and many more.

An interesting comparison in terms of state support of of BGSU versus support of business, Carroll told the trustees, is that the $84.6 million in state appropriations to BGSU, divided by the 9,000 jobs created by the University statewide, averages out to about $9,000 per job. Conversely, the North Star Steel Co. received $255,000 per job in tax abatements and subsidies from the state when it opened a plant in Delta.

“This is a compelling case for the economic value of education,” said President Ribeau, even if one does not consider the enhanced earning power of four-year college graduates over their lifetimes, estimated at $1 million over non-graduates.

For the full report, visit the provost's Web site at www.bgsu.edu/offices/provost/ and click on "Reports on Higher Education and the Economy."