VALDOSTA – How much does Lowndes County and the surrounding areas benefit economically from hosting Valdosta State University?
That is the question the Selig Center for Economic Growth at the University of Georgia’s Terry College of Business set out to answer in a recent study commissioned by the Board of Regents of the University System of Georgia – The Economic Impact of University System of Georgia Institutions on their Regional Economies in Fiscal Year 2022.
Dr. Jeffrey M. Humphreys, director of the Selig Center for Economic Growth, noted that VSU’s total economic impact on its host region – defined as Lowndes, Brooks, Lanier, Berrien, Cook, and Echols counties – between July 1, 2021, and June 30, 2022, was, in the simplest and broadest possible terms, a little more than $409.7 million, a 1.3 percent increase compared to the previous year. This includes the creation of 4,028 total jobs, of which 2,702 are off-campus jobs in the public and private sectors.
“As the flagship institution of higher education in South Georgia, it is inspiring to see how our efforts on campus and through our public/private partnerships contribute to the area’s progress and prosperity,” shared Dr. Richard A. Carvajal, president of VSU. “With an economic impact of nearly $410 million, we are an integral part of the lifeblood of Valdosta, Lowndes County, and surrounding communities.
“We understand that what we do at VSU is critical to the economic growth and vibrancy of South Georgia. We remain committed to finding ways to sustain our institution for generations to come and to leading solution-oriented innovation that will continue to support and advance this region we call home.”
Humphreys’ report provided additional information about the economic impact of spending by VSU as an institution of higher education, by VSU employees, and by VSU students.
Initial Spending – $348,695,561
According to the report, total initial spending accruing to VSU’s regional economy is the combination of three types of spending – spending by the university for personnel services, spending by the university for operating expenses, and spending by the university’s students.
Spending originating from personnel services accounted for about 28 percent ($97,549,869) of initial spending during Fiscal Year 2022. Spending due to operating expenses accounted for about 21.7 percent ($75,775,373) of initial spending. Student personal expenditures accounted for about 50.3 percent ($175,370,319) of initial spending.
Total Output Impact – $409,706,961
According to the report, output impact was calculated for each category of initial spending, based on the impact of the first round of spending and the impacts generated by the re-spending of these amounts – the multiplier effect. Total output impacts are the most inclusive, largest measures of economic impact.
Of VSU’s total output impact, 85.1 percent ($348,695,561) was initial spending, while 14.9 percent ($61,011,400) was the induced/re-spending impact or multiplier effect, or the difference between output impact and initial spending. The multiplier captures the regional economic repercussions of the flows of re-spending that take place throughout the region until the initial spending has completely leaked to other regions.
On average, every dollar of initial spending generated an additional 17.5 cents for the economy of VSU’s host region during Fiscal Year 2022.
Total Value-Added Impact – $265,105,525
According to the report, value-added impacts, which exclude expenditures related to foreign and domestic trade, provide a much more accurate measure of the actual economic benefits flowing to businesses and households in VSU’s host region than the more inclusive output impacts.
VSU’s value-added impact equaled about 64.7 percent of its $409.7 million output impact, with foreign and domestic trade comprising the remaining 35.3 percent of the output impact during Fiscal Year 2022.
Labor Income Impact – $175,338,176
According to the report, VSU generated a labor impact on its host region of $175,338,176 in Fiscal Year 2022. The labor income received by Lowndes County and neighboring communities represents 66.1 percent of the value-added impact.
Employment Impact – 4,028
According to the report, the economic impact of hosting VSU is most easily understood in terms of the university’s impact on employment. VSU generated an employment impact of 4,028 jobs in Lowndes County and surrounding communities in Fiscal year 2022.
Approximately 32.9 percent (1,326) of these positions are on-campus jobs, while 67.1 percent (2,702) are off-campus jobs in the public or private sector that exist due to VSU-related spending.
In his report, Humphreys stated, “These economic impacts demonstrate that continued emphasis on colleges and universities as a pillar of the state’s economy translates into jobs, higher incomes, and greater production of goods and services.”
https://www.usg.edu/news/release/university_system_of_georgias_economic_impact_grows_to_20.1_billion_as_graduates_earn_1_million_more_with_their_college_degrees to learn more about the University System of Georgia’s collective economic impact on Georgia and view the full 27-page report.
On the Web: www.valdosta.edu