Colleges give state economic boost

Report puts salary impact at $4.25 billion

By Berny Morson, Rocky Mountain News (Contact)

Tuesday, December 11, 2007

Colleges and universities add $4.25 billion in salaries to the Colorado economy, according to a report prepared for the state Department of Higher Education.

"The health of higher education in Colorado is an absolute, fundamental driver to the health of the Colorado economy," state higher education director David Skaggs said Monday.

The report by economist Tucker Hart Adams comes at a time when Colorado higher education leaders are seeking additional state funding, either through the legislature or at the polls. State funding for Colorado colleges and universities - as opposed to tuition revenue - is near the bottom among the 50 states.

Skaggs declined at a news conference to link the report to efforts to get Gov. Bill Ritter to back a ballot measure to increase higher education funding. But Skaggs said Coloradans need to understand the key role higher education plays in the economy.

Adams said the $4.25 billion of salaries created by higher education includes the direct employment of nearly 58,000 workers, plus another 40,000 who have jobs because of spending by those employed directly at colleges.

Adams said there is no way to quantify the total amount of money higher education puts into the economy beyond the salaries. But out-of-state students and their parents spend money in the state, and many high-tech companies evolve from faculty research, she said.

Colleges help attract business from other states. Companies prefer to locate in places with an educated work force, Adams said.

Also, Adams said, educated people earn more money and pay more taxes over the course of their lives.

A person with a bachelor's degree will earn a lifetime salary of $2.6 million, compared with $1.5 million for a someone with only a high school diploma. The figures are from a 2004 report by the Federal Reserve Bank of Dallas.