BOSTON (State House News Service) – A new report from an organization representing the private higher education world quantified the economic impact the sector has in Massachusetts, but the group’s president said the impacts go beyond spending at a time when Massachusetts’ competitive position is getting a closer look on Beacon Hill.
The Association of Independent Colleges and Universities of Massachusetts (AICU Mass) said its 59 independent, nonprofit college and university members have an annual economic impact of $71.1 billion, generate $2.4 billion in tax revenue for the state, and collectively support 320,800 jobs. Colleges and universities spend $35 billion on operations, alumni who live and work in the area have spending power of $28 billion, the institutions have $4.4 billion in capital spending, and the campuses spin off $3.6 billion in ancillary spending, according to the study conducted by conducted by national research firm Econsult Solutions, Inc.
“In Massachusetts, we know instinctively that our private colleges and universities are crucial for our economy, with these institutions continuously helping to define what it means to learn, work and live in the Commonwealth,” Rob McCarron, president and CEO of AICU Mass, said. “This Economic Impact Study puts that into hard numbers that quantify just how crucial. Across this state, these schools are the economic engines for their communities and their regions. Taken together, they are one of the most important anchors of our robust and vibrant knowledge-based economy.”
The eastern part of the state in particular, AICU Mass said, reflects “one of the densest concentrations of private higher education in the world.” The group’s 42 members schools in and around Boston account for $64 billion or 90 percent of the estimated economic impact and support 283,000 jobs, or 88 percent of the total.
The 11 AICU Mass schools in Western Mass. have an economic impact of $3.3 billion and support 19,400 jobs. There are eight AICU Mass schools in Central Mass. (two that also have campuses based in Boston), which have an economic impact of $3.8 billion and support 18,800 jobs.
“If you live in Boston or Cambridge or one of the small towns that host so many of our Massachusetts colleges then you know the unique intangible benefits — the vibrancy of the students, the access to the arts, to theater and music and classes. What this report shows in hard data are the very tangible impacts of dollars and jobs,” Suffolk University President Marisa Kelly, AICU Mass’ board chair, said. “The research makes clear the enormous daily contribution of private higher education to our economy in direct spending and jobs.”
In Gov. Maura Healey’s fiscal year 2024 budget proposal (H 1), public higher education would be in line for an increase of $371 million or 23 percent. That includes a 3 percent increase to the base funding for each higher education segment, including the University of Massachusetts system.
McCarron said AICU Mass’s report should “serve as a critical reminder of the tremendous impact of the private colleges and universities in the state, not just those detailed in the report, but those less quantifiable.”
“Our knowledge-based economy and access to talent is why companies relocate their headquarters to the Commonwealth; it’s what helps our state economy better weather recession, and is often cited as an invaluable asset in state bond ratings,” he said.
While their footprint and impacts are felt through the state, private colleges also enjoy property tax exemptions that come with being registered as nonprofits. The schools over the years have resisted attempts by some policymakers to draw more money from schools, especially those with big endowments.
