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Eli Meir Kaplan
Feb12 Education story
Feb12 Education story
Maryland may be relatively small, but when it comes to the economic impact of—and revenue generated by—higher education, the Free State is a powerhouse.
From the salaries earned by college and university employees to the taxes paid by those employees; from the revenue generated when Mom and Dad visit and take their hungry students out for pizza to the money those students themselves spend at off-campus bookstores, coffee shops, and theaters, the commerce of education is a serious contributor to Maryland’s bottom line.
In addition to the state’s colleges and universities, its 175 private career schools, such as cosmetology or truck-driving schools, also play a noteworthy role in the economy. And while there’s no single hard-and-fast figure that pulls all the numbers together, it’s generally agreed that the financial contributions of education are substantial.
Not surprisingly, the University of Maryland College Park is a leader when it comes to generating revenue.
“Our overall operating budget is $1.7 billion annually,” says Brian Darmody, associate vice president for research and economic development at the university.
“We get approximately $400 million from taxpayers, but for every tax dollar paid, the state gets $10 back, according to an independent economic analysis.”
West of the Prince George’s County institution, Hood College is having a similarly meaningful impact in Frederick. With a total student body of about 2,500 and an operating budget of almost $38 million, Hood makes a sizeable contribution to the local economy and is a major economic engine in the city, county, and region.
“Most of that budget is reflected in salaries for our employees, who are local residents,” says Charles Mann, Hood’s vice president for finance. And “over the last year, we undertook a $26 million capital-improvement effort.”
That effort includes a new athletic facility that added $10 million to the economy and involved a local architect and construction firm. Further, Mann estimates that an additional $20 million in capital-improvement dollars made its way to area businesses and that, overall, 1,600 Frederick County jobs are sustained by the presence of the college.
“We have 3,501 community members who are alums, students, faculty, and staff who are living in Frederick County, including 271 teachers, eight principals, 12 assistant principals, and 12 school counselors who are Hood graduates,” he says, noting that while the private college does receive some money from the state for student scholarships, it is not financially compensated by the county.
Yet in addition to the dollars generated by Hood, there’s the tough-to-put-a-price-on artistic and cultural contribution that the school makes to the region.
“Annually, we have about 20 art, music, and cultural events that are open to the community,” says Mann. “And there are some 25 lectures—all of which are free—that Hood sponsors each year.”
Even harder to quantify than the cultural impact of higher education is its effect on human capital—and the way the presence of so many colleges and universities entices smart men and women to come to (or remain in) the state.
“We do not have a ‘brain drain’ as do some states,” says Daraius Irani, director of Towson University’s Regional Economic Studies Institute, noting that about 80 percent of Towson grads stay in the Free State.
And there’s a good chance that these graduates’ neighbors hold degrees, too.
According to the Maryland Higher Education Commission, more than one-third of Marylanders age 25 and older hold a bachelor’s degree or higher, which gives Maryland the fourth-largest percentage of residents with college degrees in the nation.
Irani notes that, in 2008, the Baltimore Collegetown Network, a consortium of 16 public and private schools in the region, announced that the network contributed “$17.2 billion in economic activity to the regional and state economy.” And that figure doesn’t include contributions from the University of Maryland College Park, Frostburg State University, or Washington College.