2017 OSUIT Economic Impact Report - Fact Sheet

FACT SHEET

The Economic Value of Oklahoma State University Institute of Technology | April 2017

Oklahoma State University Institute of Technology (OSUIT) creates a significant positive impact on the business community and generates a return on investment to its major stakeholder groups— students, taxpayers, and society. Using a two-pronged approach that involves an economic impact analysis and an investment analysis, this study calculates the benefits to each of these groups.

Results of the analysis reflect Fiscal Year (FY) 2015-16.

IMPACT ON BUSINESS COMMUNITY IMPACTS CREATED BY OSUIT IN FY 2015-16 ADDED INCOME

JOBS

$29.1 million

501

During the analysis year, OSUIT and its students added $222 million in income to the Oklahoma economy, The economic impacts of OSUIT break down as follows: Operations spending impact •

amounted to $24.8 million, much of which was spent in Oklahoma to purchase groceries, clothing, and other household goods and services. The university spent another $19.2 million to support its day-to-day operations.

Operations spending impact

•

$2.1 million

$190.9 million

Impact of student spending •

Total impact

Around 10% of students attending OSUIT originated from outside the state.

Some of these students relocated to Oklahoma. In addition, a number of

2,811

students would have left the state if not for OSUIT. These relocator and retained students spent money on groceries, transportation, rent, and so on at state

Alumni impact

$222 million

The net impact of university payroll and expenses in Oklahoma during the analysis year was approximately $29.1 million in income.

60

Student spending impact

OSUIT employed 416 full-time and part-time employees in FY 2015-16. Payroll

businesses.

3,372

•

The expenditures of relocator and retained students during the analysis year added approximately $2.1 million in income to the State of Oklahoma economy.

Alumni impact •

Over the years, students have studied at OSUIT and entered or re-entered the workforce with newly-acquired skills. Today, thousands of these former students are employed in Oklahoma.

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2614+1 STUDENT RATE OF RETURN

•

12.8%

•

7.2%

0.6%

Average Annual Return for OSUIT Students

Stock Market 10-year Average Annual Return*

Interest Earned on Savings Account (National Average)**

* Forbes’ S&P 500, 1994-2014.

at the total number of students who received an education at OSUIT 30 years ago. We took that number and subtracted the former students who have left the workforce due to retirement, death, migration, or unemployment. This tells us how many students who left OSUIT that year are still active today. This process is repeated for each subsequent year. When the head counts for each year are added together, the total number of alumni active in the state workforce is found.

The accumulated contribution of former students currently employed in the state workforce amounted to $190.9 million in added income during the analysis year.

RETURN ON INVESTMENT TO STUDENTS, TAXPAYERS, AND SOCIETY

Student perspective •

•

** FDIC.gov 12-2016.

To estimate how many former students were active in the workforce, we looked

For every $1 spent by…

OSUIT’s FY 2015-16 students paid a total of $11.5 million to cover the cost of tuition, fees, and supplies. They also forwent $38.5 million in money that they would have earned had they been working instead of learning.

In return for the monies invested in the university, students will receive a present value of $149.5 million in increased earnings over their working lives. This translates to a return of $3.00 in higher future earnings for every $1 that students invest in their education. The average annual return for students is 12.8%.

Taxpayer perspective

STUDENTS

•

$3.00

In FY 2015-16, state taxpayers in Oklahoma paid $21.2 million to support the operations of OSUIT. The net present value of the added tax revenue stemming from the students’ higher lifetime earnings and the increased output of businesses amounts to $39.3 million in benefits to taxpayers. Savings to the

Gained in lifetime earnings for STUDENTS

public sector add another $7.3 million in benefits due to a reduced demand for government-funded services in Oklahoma.

•

TAXPAYERS

Dividing benefits to taxpayers by the associated costs yields a 2.2 benefit-cost ratio, i.e., every $1 in costs returns $2.20 in benefits. The average annual return

$2.20

on investment for taxpayers is 6.3%.

Gained in added state revenue and social savings for TAXPAYERS

Social perspective •

The economic base in Oklahoma will grow by $443.1 million over the course of the students’ working lives. Society will also benefit from $30.2 million in present value social savings related to reduced crime, lower unemployment,

SOCIETY

and increased health and well-being across the state.

$5.50

•

Gained in added taxes and public sector savings for SOCIETY

For every dollar that society spent on OSUIT educations during the analysis year, society will receive a cumulative value of $5.50 in benefits, for as long as the FY 2015-16 student population at OSUIT remains active in the state workforce.

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