Report: College ripple effects support 857 jobs
For the Tribune
Although Neosho County Community College only spent about $10.3 million on its payroll in the 2017-18 fiscal year, the college had a regional economic impact of more than $30 million.
The $30.2 million figure comes from an economic impact report by Economic Modeling LLC, or EMSI, which was presented to the NCCC Board of Trustees at its regular Jan. 13 meeting.
“What this report does is it analyzes how the economy would change if Neosho County Community College didn’t exist,” said Stephen Pool, economic analyst with EMSI.
NCCC President Brian Inbody explained the importance of the report.
“We do a study like this to measure how much impact we are having on our communities,” Inbody said. “We know we are changing lives and helping families on an individual basis, but having an outside group of economists compute our aggregate impact on our service area is evidence that NCCC is making a difference on a large scale.”
The company used metrics and statistics from its own economic models as well as data provided by the college to analyze both the college’s economic impact and the return on investment to its various stakeholders.
The college’s overall impact of $30.2 million – which supported or affected around 857 regional jobs – is made up of three separate markers: its operational spending, student spending, and alumni spending, according to Pool.
The report found that NCCC’s operational spending added $9.8 million in additional revenue to the region, supporting 475 jobs.
“For student spending, we measured … students that have relocated into your region to attend your institution and in-region students who would have otherwise left the region if not for the presence of (NCCC),” Pool explained. “The spending of these … students represents new or retained money to your service region that we can attribute to the presence of your institution.”
The student spending impact totaled $961,700, supporting 29 jobs.
Lastly, the alumni spending impact totaled $19.4 million and supported 353 jobs. Pool said this metric was uniquely important to the college’s overall impact.
“The alumni impact is very special, as it is completely unique to higher education,” Pool said. “Every business has an operational spending impact, but only higher education creates human capital.”
Pool said that by measuring the increased earnings of alumni still working and living in the NCCC region, the report provides a unique perspective on the true impact of the school.
“The education students receive at your institution … means they’ll receive higher earnings for their entire working lifetimes,” he said. “Additionally, the businesses they work for will be more productive and therefore more profitable.”
In EMSI’s investment analysis, the report found that while students in the 2017-18 school year invested $14.4 million in tuition costs, fees and other expenditure and opportunity costs, they are projected to receive around $58.1 million in higher future earnings.
“This is a rate of return at 16.2 percent, which is really fantastic,” Pool said. “One common comparison is the stock market, (which) on a 30-year average tends to vary between 9.9 and 10.1 percent average return. So it is safe to say that an investment in an education at NCCC has a greater rate of return and is safer than a comparable investment in the stock market.”
Taxpayer return on investment was about 4.6 percent, with taxpayers paying in around $9 million during the year, but future tax relief adding up to $16.5 million.
That tax relief, Pool said, represented students making more money and paying more in taxes; businesses being more profitable and paying more in taxes; and citizens with higher educations lessening the burden on local government.
“Since higher-educated citizens tend to need government services less often, their education represents a government savings in avoided expenses,” he said. “They tend to be healthier, commit fewer crimes, and need welfare and unemployment less frequently.”
He said as taxpayer-funded institutions, colleges in general represent a rare resource.
“Many taxpayer investments tend to have very low returns … or negative returns,” he said. “Think about your city park. It’s meant to have, but rarely does it represent a positive cash flow for your city.
“What this means at its heart is that Neosho County Community College generates more money for your taxpayers than it takes to operate.”
In other business, the board:
Appointed Trustee Dennis Peters as board chair for 2020.
Appointed Trustee Lori Kiblinger as board vice chair.
Retained Sandi Solander, Angela Rowan, Kent Pringle and NCCC President Brian Inbody as board treasurer, clerk, attorney and secretary, respectively.
Approved an adjustment to the NCCC military leave policy to include board-hired part-time employees.
Approved a baseball turf agreement that allows the board to take ownership of the turf at NCCC’s baseball field. The turf was gifted to the board by the NCCC Foundation Board.