Socioeconomic Impact of Herkimer County Community College
Herkimer County Community College provides a wide variety of post secondary education and lifelong learning opportunities, while supporting workforce development in the region. The College plays a significant role in the local economy and is a sound investment from multiple perspectives.
Students benefit from an affordable first two years of higher education preparing them for transfer studies or careers. They also learn to become engaged citizens in a global society, and eventually benefit from the improved lifestyles and increased earnings that result from a higher education. Taxpayers benefit from a larger economy and lower social costs. Finally, the community as a whole benefits from increased job and investment opportunities, higher business revenues, greater availability of public funds and an eased tax burden.
In the spring of 2010, Herkimer County Community College partnered with Economic Modeling Specialists Inc. (EMSI), to conduct a study of the economic contributions of the College. Specializing in economic impact analysis, labor market/workforce development forecasting, and economic growth analysis, EMSI applied a comprehensive model designed to quantify the economic benefits of the college into common sense benefit/cost and investment terms. The result is a report detailing the role the college plays in promoting economic development, enhancing student careers, and improving quality of life.
Student Perspective »
From an investment standpoint, HCCC students enjoy a 14.2% rate of return on their investments of time and money. This compares favorably with returns on other investments, e.g., long-term return on stocks and bonds. For every dollar students invest in HCCC education, they receive a cumulative of $5.10 in higher future income over their working careers. This is a real return that accounts for any discounting that occurs during the entire period.
Taxpayer Perspective »
State and county governments allocated approximately $16 million in support of HCCC in fiscal year 2008-09. For every dollar of this support, taxpayers see a cumulative return of $2.00 over the course of students’ working career in the form of higher tax receipts and avoided costs.
State and county governments see a rate of return of 6.5% on their support for HCCC. This return compares very favorably with private sector rates of return on similar long-term investments.
Business Perspective »
HCCC affects the local economy in three ways:
- Through its local purchases, including wages paid to faculty and staff
- Through the spending of students who come from outside the region
- Through the increase in the skill base of the local workforce.
HCCC’s total impact amounts to an estimated $75 million in added income in Herkimer County each year. This is equal to approximately 6.3% of the total Herkimer County economy.This impact breaks down as follows:
The Herkimer County economy receives approximately $26.1 million in net added income each year due to HCCC operations and the spending of non-local students. Approximately 65% of HCCC employees live in Herkimer County. HCCC creates income through the earnings of its faculty and staff, as well as through its own operating and capital expenditures. It is estimated that Herkimer County receives $18.5 million in net added income due to HCCC operations each year.
Approximately 65% of HCCC students come from outside the county, bringing with them monies that would not have otherwise entered the county economy. The spending of HCCC’s non-local students for room and board, transportation, entertainment and other personal expenses generates about $7.6 million in added income in Herkimer County each year.
Every year students leave the college to join or rejoin the workforce. Their added skills translate to higher income and a more robust Herkimer County economy. Based on HCCC’s historical enrollment and credit production over the past 30-year period, it is estimated that the accumulated contribution of HCCC instruction received by former students (both completers and non-completers) annually adds some $48.9 million in income to Herkimer County.
From the perspective of society as a whole, the benefits of education are staggering. Workers with postsecondary education expand the state’s economic base through higher incomes, while the businesses that employ them also become more productive through the students’ added skills. The effect of HCCC students working in New York State is an estimated $15.6 million in taxable income (together with the associated ripple effects) to the state’s economy each year.
Higher education levels are associated with social benefits such as being less likely to smoke or abuse alcohol, use welfare or unemployment benefits, or commit crimes. These external social benefits translate into associated dollar savings (avoided costs) to the public equal to approximately $952,900 annually. Other benefits include volunteering and donating to charities.
It is estimated that HCCC provides a benefit/cost ratio of 17.3 (every dollar of state and local tax money invested in the college today yields a cumulative of $17.30 in benefits that accrue to all New York residents, in terms of added taxable income and avoided social costs.