U of Ideas of General Interest -- April 2000
University of Illinois at Urbana-Champaign
Contact: Mark Reutter, Business and Law Editor (217) 333-0568; [email protected]
THE ECONOMICS OF EDUCATION
It pays to go to college in Illinois -- to the tune of $590,000, report says
CHAMPAIGN, Ill. -- Go to college in Illinois. Collect $590,000.
That's how much more a bachelor's degree at an Illinois college or university provides the average student over a lifetime compared with the earnings of a high school graduate, according to a study headed by economists at the University of Illinois.
The 76-page report, "Illinois Higher Education: Building the Economy, Shaping Society," is a comprehensive look at the economic impact of 138 schools of higher education. "Colleges and universities have become vital participants in the community and economy," writes Robert W. Resek, a professor at the UI Institute of Government and Public Affairs and a co-author of the report.
Higher education in Illinois has the following impacts:
-- The added lifetime value (over a high school diploma) of an associate's degree was $207,609 and for a bachelor's degree $509,648. The value of a doctoral degree (beyond the earnings of a bachelor's degree) was $426,109, while the "add-on" value of a medical or law degree averaged $1,248,495 over a bachelor's degree.
-- Students who stay in Illinois to work after graduation will produce an estimated $5.9 billion in future yearly state and local tax receipts over the tax revenues generated by high school graduates.
-- Direct expenditures by Illinois colleges and universities total $10 billion a year and account for 116,000 full-time jobs. Of this total, $2.8 billion and 30,000 jobs come from monies secured from sources outside of Illinois, mostly federal research grants that go to the state's primary research university -- the UI -- followed by grants to the University of Chicago and Northwestern University.
-- Students spend nearly $4 billion a year while attending Illinois colleges and universities, while spending by visitors to campuses and college events exceeds $520 million a year. As much as $910 million of this total amount comes from out-of-state students and visitors.
Illinois has the fourth-largest number of students enrolled in higher education, following California, New York and Texas. During the 1998-99 academic year, 732,000 students attended the state's public and private universities, colleges and community colleges.
The study was funded by the Illinois Board of Higher Education. In addition to Resek, the chief investigators were David F. Merriman at Loyola University and Susan R. Hartter, Diane M. McCarthy, and Paul F. Byrne at the UI.
Estimates of the economic impact of higher education were generated by the Regional Economics Applications Laboratory of the UI and the Federal Reserve Bank of Chicago. Additional data were supplied by researchers at Northern Illinois University, Illinois State University and Loyola University.
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