Colleges are an important engine of economic growth. They produce graduates who innovate, create and generate countless products, companies, and jobs. But colleges also do so much more for their economies. They are research hubs, startup incubators, and homes for the advancement of all sorts of beneficial things. When you start thinking about colleges as the centers that make their areas much more prosperous, you have to wonder which ones do this the best. This article is going to highlight to you the colleges responsible for the largest effects on America's prosperity.
Some perceive colleges to be inefficient places filled with professors who are unable to work in the "real world." But this couldn't be further from the truth. Colleges generate billions and trillions of dollars a year, directly and indirectly, for their cities, states, and countries. And many professors are still active in their industries and help them thrive. So which colleges are doing this the best?
Before now, there had not been a definitive ranking of the colleges with the largest economic impacts. But this information is incredibly useful. So we've done the extensive research and made something that will show you clearly which colleges are great at improving the financial health of the areas around them.
Any one of the 30 colleges listed below is a great choice, whatever your field of study! Prospective students looking to enter a range of subjects can use this article to help with refining their college options. Knowing the colleges that are contributing the most to their economies should be a major deciding factor in your college choice. Even if there isn't a college here that's right for you, you can still use the information in this article to inform your ultimate college destination. We've included summaries of how each college is impacting its economy. We've done this so that you can take that information and compare it to your college choices. Hopefully, this article will aid you in attending a college that is contributing hugely to the world around it!
Finding the colleges with the largest economic impacts has involved extensive research. Many colleges report their economic output. However, their reporting is sporadic, and some colleges have reports that are over 10 years out of date.
What information is available has been studied and updated. Realistic estimates of the economic impacts can be made through assessing new projects, yearly budgets and other growth statistics published by colleges since these economic reports. For instance, one of the most comprehensive studies of the economic effects of colleges comes from a 2006 paper published by Vanderbilt University. Obviously, much has changed since 2006. So the colleges in our list that were found in the 2006 paper have been researched to see how their economic impacts have evolved over the last decade.
Our overall rankings come from looking into the top American colleges as agreed upon by a range of lists and then looking into statements of impacts upon their economies.
Our full sources are as follows:
Department of Economics, Vanderbilt University, The Economic Impact of Colleges and Universities: http://www.accessecon.com/pubs/VUECON/vu06-w12.pdf
Citylab, The Economic Impact of College Graduates on Local Economies: https://www.citylab.com/life/2016/02/the-economic-impact-of-college-graduates-on-local-economies/435414/
Association of American Universities, Economic Impact: https://www.aau.edu/education-service/service/economic-impact
QS/Top Universities, Top Universities in the US 2019: https://www.topuniversities.com/university-rankings-articles/world-university-rankings/top-universities-us-2019
US News, National University Rankings: https://www.usnews.com/best-colleges/rankings/national-universities
What has factored into the rankings of the colleges below are the following criteria: gross economic impact the college produces, most value that graduates have added to their college's local economy, number of jobs created by the college and alumni, number of businesses helped by the college and other examples of innovative economic boosting from the college.
Our results, from 30 to one, are below:
30. University of Notre Dame
St Joseph County, Indiana
The University of Notre Dame is mostly active within St Joseph County in Indiana. This can be shown through the amount of its statewide economic output that goes into this county. In 2016, it contributed $1.2 billion to Indiana's economy, but over $1 billion of this went into St Joseph County. Additionally, statewide it maintained over 11,000 jobs, with almost 10,000 of these being within its home county. If you want to study at a college that is heavily focused on its immediate surroundings, then this data shows that the University of Notre Dame could be a perfect choice!
29. Harvard University
Measuring the economic impact of a college that is surrounded by other prestigious colleges is a challenge. Harvard University is located near Boston University, Boston College, MIT, and others. When the financial benefits of all the college graduates in the area are combined, then Boston has the second most added value of any metropolitan area in the country, according to Citylab. However, Harvard University certainly has some strong claims to being one of the greatest contributors to the local economy. For instance, it has been the largest employer in its city for 18 years. And in 2016, the college spent $1.5 billion on Massachusetts based businesses for construction, supplies, and services. On the various top national colleges lists, Harvard ranks at second on US News and third on QS/Top Universities.
28. Columbia University
New York City, New York
New York City is in the metropolitan area that has the ninth highest economic benefit from college graduates, according to Citylab. In 2017, Columbia University was one of the top contributors to its area's economy. It employed over 20,000 people. Additionally, from 2012 to 2017, it invested $578 million into New York State. And in 2016 alone, its funded research that pioneers innovations and startup companies totaled over $737 million in expense. When these findings were published, the college expected to create 2,500 more jobs in the next 10 years. US News considers Columbia University to be the third best university in America, and Top Universities/QS considers it to be the ninth best.
27. Princeton University
New Jersey State
Association of American Universities hosts a report that details Princeton University's economic impact up until 2007. And it reveals that Princeton did some impressive things for its home state of New Jersey. For instance, at the time, over 6,000 alumni were still based in the state. Additionally, it generated slightly over $1 billion in revenues and employed over 5,000 people. In the present day, this economic impact has increased significantly, with its financial output standing at $1.58 billion per year and employment at over 6,000 people. Princeton University is also US News's top national university and QS/Top Universities's sixth-best American college.
26. University of California, Santa Barbara
Santa Barbara County, California
The most recent report on the economic impact of the University of California, Santa Barbara comes from 2010. In that year, the college stated that it had a $1 billion impact on its state's economy. However, it noted that much of this impact was based in Santa Barbara County. At the time, over 90 local companies had been founded by college alumni. Additionally, it stated that it employed 9,500 people in the nearby area. While more recent impact figures have not been released, the college's increase can be estimated from its budget. In 2010, the college's budget was $468 million. In 2016, the college's budget was $760 million. As the budget has almost doubled since 2010, it can be predicted that the current economic impact of the college has also doubled to nearly $2 billion per year.
25. University of Chicago
The 2006 Vanderbilt University study highlights how the University of Chicago is benefiting its local community in a number of innovative ways. One such manner is through creating a University of Chicago Police Department, which patrols an area greater than the college itself. And in the present day, the college's innovative ways of improving the economy of its home city have only increased. The college now runs community program accelerators, which fund and support non-profits; has established a student civic engagement center; and aims to revitalize some of Chicago's major retail areas. The college itself employs 10,000 people. On national rankings, University of Chicago is joint third on US News's best national universities list and fifth on Top Universities/QS's list.
24. Yale University
Association of American Universities's latest economic impact data for Yale University comes from 2012. This study stated that almost 14,000 Yale alumni were currently living in the state of Connecticut. It also estimated that at that point, the college had created over 43,000 jobs in the state, which included alumni company job creation. The college itself currently employs 14,000 people. It also ensures that these employees benefit their local economy by providing a program which assists in buying homes in the area. Yale University itself states that its annual financial impact upon its economy is over $2 billion. It is Top Universities/QS's eighth-best American college and US News's joint third best national university.
23. Washington University in Saint Louis
Saint Louis, Missouri
Association of American Universities commends the impact of Washington University in Saint Louis. The college's latest economic report dates to 2016 and reveals that it spent over $2.1 billion in the Saint Louis region. Additionally, it supported over 43,000 jobs. But what's really impressive about the impact of Washington University in Saint Louis is what it's spending its money on. The college states that it's dedicated to championing the local businesses in its region. It's also investing in the region's next generation by providing a college prep program for high achieving high school students with limited financial resources.
22. University of Oregon
In 2004, University of Oregon reported that it generated $10 for every dollar it spent, according to Vanderbilt University's report. In the present day, the college states that its annual economic footprint for the state of Oregon is $2.3 billion. And the college is displaying its impact in a unique way. It has produced an interactive map that showcases how it is benefiting the different counties in Oregon. This map shows information such as the amount the college is paying to vendors and the number of alumni living in the area.
21. Carnegie Mellon University
In 2017, Carnegie Mellon University reported that its annual economic impact in Pennsylvania was $2.7 billion. Additionally, it employed 18,000 people and had created 148 startups over the last five years. Overall, these startups had raised over $1 billion in funding. Carnegie Mellon University attributed much of its economic success on its Swartz Center for Entrepreneurship. This center has boosted Carnegie Mellon startups' business with college research. Additionally, it is also responsible for fostering partnerships with more than 350 large corporations such as Amazon, Apple, Disney, Facebook, and Google. All of those companies now have offices in Carnegie Mellon's city of Pittsburgh as a result of the college's efforts.
20. New York University
New York City, New York
The information about New York University's economic impact presented in the Association of American Universities is older than that found on NYU's website. This means that the two can be compared, to see the growth. The older report states that in 2009, the college and student spending in the local area amounted to $2.25 billion per year. In the more recent report, it states that in 2013, this spending had increased to $2.9 billion per year. But the college's Start Up Program is where New York University is really proud of itself. Startups based in its incubators had generated $251 million by 2013 and have to date created thousands of new jobs in New York City.
19. Cornell University
Tompkins County, New York
The most recent record of Cornell's statewide economic impact comes from 2013 when the college published a report conservatively estimating it to be $3.2 billion. $1.2 billion of this was spent in its home county on paying employees, purchasing resources and constructing buildings. Additionally, its faculty and staff numbers were over 20,000 when its report was published. However, Association of American Universities endorses more recent statements from Cornell, including that the college has supported over 722 startups and provided a total of over $10 billion in funding to these.
18. Wake Forest University
Winston-Salem, North Carolina
In the fiscal year of 2012 to 2013, Wake Forest University's economic impact upon its region was $3.3 billion. The college was particularly proud of the $294.2 million of income that its alumni who were living in the local area had provided to the economy. The college has not published an update on its financial benefit in the years following the 2012 to 2013 report. But it is certain to have increased its economic output considerably. In construction alone, the college has stated that it is spending $625 million from 2016 to 2026.
17. University of Michigan
Ann Arbor, Michigan
Thanks to the different data that the Association of American Universities and the University of Michigan provide, it is possible to see the growth of this college from 2003 to 2017. For instance, in 2003, the college had 26,317 employees in Michigan. By 2017, it had almost doubled this number to 51,638 employees in Michigan. In 2017, University of Michigan estimated that the total earnings and benefits that the college is responsible for totaled over $4 billion. The college has many success stories that show how it is perfectly aligned with its state's values. For instance, its industry partners recently invested $11 million into the college. This money will be used to accelerate the development and implementation of connected and automated vehicles to improve traffic safety. Michigan has a proud history of automotive innovation, so this latest project could be the next phase!
16. University of Georgia
A 2018 study revealed that the University of Georgia's home state economic impact is $5.7 billion a year. The college calculated this figure by taking data on the earnings of alumni and analyzing the number of them who stay in Georgia after degree completion. They also factored in funded research, start-up businesses and scientific products that have been produced by the college. US News considers the University of Georgia to be the 46th best national university, and Top Universities/QS considers it to be the 82nd best national university.
15. Duke University
North Carolina State
Association of American Universities provides information upon Duke's economic impact in the fiscal year of 2012 to 2013. It stated at that time, the college added $5.8 billion to North Carolina's economy. When this information was released, Duke also revealed that it employed 31,518 people. And the alumni contribution to the North Carolina economy was $302.7 million. One of the most innovative ways that Duke has been energizing the national and international economy is through DukeEngage. This is an immersive summer program that allows students to provide assistance to needing communities. As of 2018, the program has involved over 4,000 students, who have worked in 42 US cities and 81 different countries.
14. University of Virginia
Association of American Universities has an article that states that in 2007, the University of Virginia's economic impact on the state of Virginia was over $1 billion. However, a more recent study found that in 2016, this had increased to $5.9 billion. Of this figure, $70.3 million came from students, faculty, and staff taking part in charitable community efforts, such as volunteering time or donating money. The more recent report also states that the college provided and supported over 51,000 jobs, meaning that one in every 76 Virginians was sustained by the college's activities in 2016.
13. University of California, San Diego
San Diego County, California
An overall report on the economic impact of the University of California, San Diego is overdue. Association of American Universities's latest collected report states that from 2006 to 2007, the college contributed $7.2 billion to the Californian economy, with $5.7 billion of this going into its local county. Another report details that by 2011, the college was employing 36,466 individuals and paying $1.4 billion to these employees per year. Additionally, Top Universities/QS considers the University of California, San Diego to be one of the 20 best universities in America, placing it at 17th. US News has a slightly lower perception of the college and names it 41st best national university.
12. University of Southern California
Los Angeles, California
The most recent report to come out of the University of Southern California stated that from 2015 to 2016, its economic benefit to California was $8 billion. This money supported over 53,425 jobs in the state. However, the college is also proud of its support for the local area. For instance, it is working to address the shortage of highly skilled labor through educational outreach programs. These mostly work in, "the neighborhoods surrounding USC's campuses, which are populated by under-represented demographic groups." In fact, the college supports over 400 community initiatives in these neighborhoods.
11. Vanderbilt University
Although Vanderbilt University produced one of the methodology's sources, it neglects to mention its own economic impact on Tennessee in that report. However, the Association of American Universities has a report that notes that the college's statewide financial benefit was $8.6 billion in 2011 to 2012. Vanderbilt University itself states that in 2015 to 2016 this impact had increased to $9.5 billion. Additionally, between the two reports, Tennessee based jobs supported by the college had increased from 58,000 to 63,500. Perhaps most impressively, from 2015 to 2016, the college provided $513 million worth of free medical care to Tennessee residents.
10. Emory University
Atlanta is America's second fastest growing metropolitan economy. Its rapid growth can be seen in one of its most prestigious colleges, Emory University. Association of American Universities highlights a report from 2011 that stated that the annual impact of the college on the economy of Georgia was $5.1 billion per year. However, by 2017, this sum had increased to $9.1 billion per year. Some of this sum included $400 million in community health care. Additionally, 40% of Emory University's alumni stay in Georgia after graduation, creating businesses and contributing services to local industries indefinitely.
9. Johns Hopkins University
There is no doubt that Johns Hopkins University is doing great things for Baltimore and Maryland's economies. The last time the college assessed its economic impact, in 2014, it estimated it at $9.1 billion for the entire state. This includes over $65 million of medical care being provided to uninsured and underinsured patients. The college is also the state of Maryland's largest employer, with over 48,000 individuals on the payroll. Additionally, more than 74,000 alumni currently live in and contribute to the economy of Maryland.
8. University of Maryland
Vanderbilt University discovered that in 2002, the University of Maryland was generating $5.93 for every dollar it spent, which led to a statewide economic impact of $1.8 billion. In the University of Maryland's latest impact report, which comes from 2008, its financial benefit had increased significantly in just four years. That report stated that in Maryland, the college supported $1 billion in income and $2.4 billion in business sales per year. Additionally, it produced $78 million in tax revenues for the state and local government. While the University of Maryland has not produced a more recent impact figure, an idea of its current output can be estimated from its 2018 budget. In 2018, the college's total operating budget was slightly over $2 billion. If we take the $5.93 produced for every dollar spent, this would give the college an overall economic impact of over $11 billion.
7. University of North Carolina, Chapel Hill
North Carolina State
In 2015, the University of North Carolina, Chapel Hill was proud to announce that it had an annual economic impact of over $7 billion on its state. At the time, the college was especially pleased of the service that its medical center was providing. The medical center's Dean, William L. Roper, said, "At a time when North Carolina's health care needs are rising and the number of physicians is plummeting, our economic impact cannot be underestimated." Since 2015, all evidence points to the University of North Carolina, Chapel Hill's financial benefit to its state increasing significantly. For instance, in 2017, the college announced that its start ups and social ventures were adding $10 billion to the annual economy.
6. University of California, Los Angeles
Los Angeles, California
UCLA commissioned Beacon Economics, one of California's leading consultants, to research its 2018 economic impact report. The business discovered that the college had a statewide annual impact of over $11 billion. $4 billion of this was focused on the city of Los Angeles itself, showing that the college is measured in its home city and wider economic spending. And, impressively, over 72,000 full time Californian jobs have been supported due to the college's impact. On a much wider timeframe, UCLA's startup valuations have totaled $33 billion.
5. University of Pennsylvania
The University of Pennsylvania had an annual impact of over $14 billion in its home state in 2015, Association of American Universities reports. This translated into $39 million per day for the state of Pennsylvania and $29.6 million per day for the city of Philadelphia. The college was also its state's second largest employer, with over 37,000 individuals on the payroll. Additionally, the college revealed that it spent $344 million with Philadelphia based businesses. The University of Pennsylvania also has a range of economic inclusion initiatives that are boosting its local economy in developing areas. For instance, it ensures that 20% of its construction projects worth over $5 million are given to minority and women owned companies.
4. University of Wisconsin, Madison
In the last three years, University of Wisconsin, Madison has gone from contributing $15 billion to $24 billion to the state of Wisconsin. Most universities in America have benefited from the strengthening national economy, but this college's increase in financial output is phenomenal. It also states that in 2017, every dollar invested into the university led to a return of $23. Additionally, the college was proud of generating and supporting 167,000 jobs in the state. And three business sectors each received more than $1.5 billion from the University of Wisconsin, Madison's economic activity in 2017: real estate, hospitals and computer services.
3. University of California, Berkeley
Bay Area, California
A 2007 report and a 2011 report highlight how University of California, Berkeley has grown its local economy rapidly. The 2007 report was brief, highlighting only that the college spent 81% of its $1.6 billion budget on salaries, goods and services in the Bay Area. It also noted that the college employed 25,700 people. The 2011 report showed that by that time, it was paying more than $2.5 billion in salaries. Also, the employment at Berkeley had grown to over 43,500 people. Overall, it had an economic output of more than $4.6 billion. More impressively, a 2014 report revealed that University of California, Berkeley alumni had created 2,610 active companies which employed 542,433 people. The revenue of these firms was estimated to be $317 billion per year. 55% of those companies were located in the local Bay Area.
2. Massachusetts Institute of Technology
In 2003 and 2014, MIT conducted surveys of its alumni to see how they were positively impacting the world economy. The 2003 study revealed that 20% of graduates at that time stated that they had started for-profit companies, with one quarter of these companies being located in Massachusetts. However, by 2014, the alumni start up creation figure had increased to 25% of responding graduates starting companies. What's even more impressive is that these alumni were employing 4.6 million people and generating $1.9 trillion per year. Additionally, almost a third of alumni companies were now based in Massachusetts. However, MIT's economic impact goes far beyond the success of its alumni. The college itself is its home city's second largest employer and largest taxpayer. Additionally, MIT is Top Universities/QS's number one college in America for 2019 and US News's joint third best national-university.
1. Stanford University
San Jose, California
Citylab names San Jose as being in the US metropolitan area that has benefited the most from college alumni. It states that Stanford University is producing the most of these economically beneficial graduates. Association of American Universities's research on Stanford University is outdated. But it is interesting to see how the data it shows compares to the present day. In 2006, Stanford spent over $2.1 billion in its local counties, which was just under half of its total revenues. Additionally, in 2006 it was Silicon Valley's single largest employer. From 2017 to 2018, its revenues had increased to $6.3 billion. The college did not reveal the amount of revenue that was planned to go into the local economy in that year, but it did state that it was contributing $329 million to the construction of a new campus in Redwood City. It was also in the process of buying homes and apartments in the local area to expand housing opportunities for staff, students and faculty, and spending $500 million on this. As astounding as those figures are, they pale in comparison to the impact of Stanford's alumni. In its most recent report, from 2013, Stanford University revealed that almost 40,000 companies could be traced back to its graduates. These companies were employing 5.4 million people and generating $2.7 trillion in income per year.
By BVS Staff