Executive Summary: UMass System Economic Contributions
The University of Massachusetts System offers invaluable educational opportunities in a wide array of disciplines and engages in important research?activities recognized throughout the world. The general public tends to understand UMass’s role in these key areas, but is often unaware that the institution is also a major contributor to the statewide economy. UMass not only makes a direct contribution to the Massachusetts economy through the spending and jobs supported by its academic, administration, and construction activities, but also generates a “ripple effect” that leads to an even larger impact in the economy as a result of demand on suppliers of goods and services as well as employee spending.
The purpose of this report is to perform an objective analysis to quantify the economic contributions of the University of Massachusetts System and its campuses on the Commonwealth’s economy. The results of the economic contributions analysis for fiscal year (FY) 2018 indicate that:
- The UMass System generated $7.5 billion in economic activity in FY2018. The UMass System (across all campuses) is a key economic driver in the Commonwealth, directly or indirectly affecting every person in the state. In FY2018, the University of Massachusetts contributed $7.5 billion in economic activity to the Massachusetts economy. This includes the contributions of the local operating expenditures of the University, one-time major construction expenditures, the spending of the University’s faculty and staff, and the spending of its students. Much of the UMass spending flows beyond the campuses to a variety of suppliers of goods and services, generating significant benefits for the Massachusetts economy.
- FY2018 represented a robust period of construction for UMass, making a significant contribution to the Massachusetts economy. Included in this $7.5 billion total contribution were one-time building and infrastructure project expenditures totaling $435 million in direct construction expenditures and over $326 million in additional economic activity for a total of approximately $762 million in one-time construction contributions. These construction projects were financed through University expenditures, the UMass Building Authority and the Commonwealth’s Division of Capital Asset Management (DCAM). DCAM funding alone contributed over $23 million directly to these projects in FY2018. All told, these construction projects supported 4,033 jobs in the Commonwealth. Unlike other campus activities such as payroll expenditures, construction on the campuses can spike or fall from year-to-year and thus either amplify or diminish its overall effect on the Massachusetts economy depending on the cycle. The new facilities, however, continue to play important roles after they are constructed by contributing to the University’s competitive position to attract students, employees, and researchers. Benefits to UMass are long-term from new or renovated academic buildings, laboratories, athletic facilities, and other key infrastructure like heating plants and parking garages.
- State investment in UMass leverages significantly greater economic activity. In FY2018, the state’s $752 million investment in the UMass System helped leverage and support $7.5 billion in economic activity in Massachusetts, an amount 10 times greater than the state’s investment.
- UMass employee payroll recirculates through the Massachusetts economy causing positive economic effects. A notable share of UMass’ spending also makes its way to employees in the form of salaries and wages, which is then circulated into the Massachusetts economy through typical household spending activities. In the Fall of 2018, the University employed 17,622 full- and part-time faculty and staff (excluding student employees).
- UMass generates additional jobs beyond the campuses. The spending of the University, its employees and students helped to support an additional 31,693 jobs in the Commonwealth throughout FY2018. Including faculty and staff, the University supported a total of 49,315 jobs in the Commonwealth.
- UMass student off-campus spending further supports the Massachusetts economy. In the Fall of 2018 (in FY2018), UMass System student enrollment was 74,705 (including undergraduates, graduate students, continuing education students, law students, and students in the Graduate Schools of Nursing, Biomedical Science and Medicine) and these students directly spent a substantial amount of money off-campus in the economy, which, in turn, generated additional economic activity.
- UMass enrolled 74,705 full-time students in the Fall of 2018. There were 57,079 undergraduate students and 17,626 graduate students. 82.7 percent of all enrolled students were in-state.
- Each of the five University campuses generated substantial economic contributions for Massachusetts in FY2018. By campus, contributions ranged from $2.5 billion for Amherst and $1.8 billion for the Medical School, respectively, to $1.2 billion, $1.2 billion and $550 million for each of the Boston, Lowell and Dartmouth campuses.
- The UMass System employed 17,622 full- and part-time faculty and staff in FY2018.
- More than 320,000 alumni live and work in the state. Sixty-three percent of undergraduate alumni, 50 percent of graduate alumni, and 60 percent of all alumni remain in the state after graduation.
- The UMass System attracted $374 million in federally funded research to the state in FY2018. The amount of federally funded financial aid in FY2018 was $438 million.
The following figures and tables illustrate the main findings of the economic contributions analysis.