Study shows UofL is major economic driver
The University of Louisville is a major economic driver for the city of Louisville and for Kentucky and provides a solid return on investment on state tax dollars it receives, according to a study by economist Manoj Shanker.
Shanker presented his results to the executive committee of the UofL Board of Trustees at its Jan. 14 meeting.
Shanker study covered the period from 2003 to 2009, a time when the state was losing jobs and had a struggling economy. He found that investments related to UofL during the same period, resulted in the creation of thousands of jobs.
The study's other major findings include:
9,764 additional jobs in such areas as construction, health care, research and education were created from the direct and indirect effect of UofL. That is roughly 40 percent of the net new jobs created in Kentucky during the time frame studied.
UofL activities added $1.2 billion to Kentucky's economic output.
Every dollar UofL receives in state funds results in an additional $4.12 going into Kentucky's economy. That's a jump in that taxpayer's return on investment from $2.71 for every dollar in 2003.
Shanker’s estimates of UofL's economic impact are "conservative," he said, because the study didn't include clinical care income and non-UofL employees working at University Hospital. It also did not include the impact of companies that are "incubated" or "spun-off" at UofL.
UofL President James Ramsey said the study shows that higher education is playing a central role in sustaining economic growth and in increasing the standard of living in Kentucky.
During the period under study, UofL successfully leveraged state money to attract private money and federal grants. This was done while state funding as a portion of the university's budget dropped from 31 percent to 26 percent. UofL had the second largest percentage growth in federally-funded research in the country from 2001-2008, according to the Chronicle of Higher Education.
UofL and related entities also have spent $1.1 billion on construction in the past six years.
The study’s findings, Ramsey said, prove that the state enjoys substantial return on every dollar it spends on UofL.