UNCF study: HBCUs make multi-billion dollar economic impact
WASHINGTON — America’s historically black colleges and universities (HBCUs) inject billions of dollars in economic impact into the national economy, according to “HBCUs Make America Strong: The Positive Economic Impact of Historically Black Colleges and Universities,” a landmark study released by UNCF (United Negro College Fund).
The impact described in the report includes almost $15 billion annually in economic impact. This study clearly enumerates the significant economic contributions of 100 HBCUs by focusing on the institutions’ far-reaching economic effects that can be felt in communities and nationwide, as well as the increased earning power of their students.
Offering data by institution, as well as a national analysis, the UNCF study – underwritten by Citi Foundation and prepared by the University of Georgia’s Selig Center for Economic Growth – also reports that HBCUs significantly increase local and national job creation and economic development.
For example:
• Total economic impact of HBCU spending in the United States is $14.8 billion annually; the equivalent to a ranking in the top 200 corporations on the Fortune 500 list.
• Every dollar spent by an HBCU and its students generates $1.44 in initial and subsequent spending for the institution’s local and regional economies; particularly significant as many HBCUs are in southern communities where overall economic growth has lagged.
• The strength and vitality of HBCUs prepare a critical sector of the workforce, people of color from low- and moderate-income families, to fill the economy’s demand for college-educated workers.
• HBCUs generate roughly 134,000 jobs for their local and regional economies, including on-campus and offsite jobs, equating to approximately 13 jobs created for each $1 million initially spent by HBCUs.
• HBCU graduates, over 50,000 in 2014, can expect work-life earnings of $130 billion—an additional $927,000 per graduate—56 percent more than they could expect to earn without their HBCU degrees or certificates.
“This study is conclusive evidence that HBCUs not only provide a college education for 300,000 students every year, but they are a powerful economic engine: locally, through the jobs they create and the expenditures they make in the cities where they are located, and nationally, through the students they educate and prepare for an information-age workforce,” said UNCF president and CEO Dr. Michael L. Lomax.
“The study demonstrates conclusively that HBCUs are not only relevant to the country’s economic health and vigor, they are necessary.”
“The education that HBCUs provide
to their students, many of them from low-income families and the first in their families to attend college, helps the national economy fill critical jobs with college-educated workers who otherwise would not acquire the skills and knowledge necessary to compete in the evolving workforce,” said UNCF’s Vice President of Research and Member Engagement Dr. Brian Bridges.
The first of its kind, the study sets forth those benefits in detailed dollars-and-cents terms. It shows that money spent in, around, and by the nation’s HBCUs and their students drives economic growth onand off-campus—and the effect of that spending is multiplied over time. Each dollar spent creates far more than a dollar’s worth of productive activity as it moves through the economy.
“The future economic competitiveness of our nation hinges on the positive economic outcomes of our young people,” said Brandee McHale, President, Citi Foundation. “HBCUs are developing our next generation of business and civic leaders. These impactful institutions have long contributed to the fabric of our nation and continue to fuel economic progress, which has a profound ripple effect on the strength of our families, communities, and businesses.”
HBCUs have long been bastions of academic achievement — it is clear to see that the value of HBCUs is not solely confined to economic impacts. HBCUs are 3 percent of America’s public and private nonprofit colleges that receive federal student aid, but enroll 10 percent of African American undergraduates, award 17 percent of African American bachelor’s degrees and award 24 percent of African American STEM bachelor’s degrees. When the economic impact of these same schools is examined, it becomes clear that HBCUs are not only a sound economic decision for students, but that investing in HBCUs is beneficial for the communities they serve, potential employers of HBCU graduates, and the nation at large.
The study demonstrates conclusively: HBCUs matter—not only to students but also to employers, economic development and the economy.