Each Colorado College student spends on average just shy of $9,024 a year off-campus, creating an economic impact of $35.6 million to the Colorado Springs economy, according to a report planned for release Friday morning.
Including other factors, the college sent an average of nearly $168 million into the local economy each year from 2006 to 2011, for a total over five years of more than $839 million.
CC senior economics student Aradhya Sood researched and wrote the report for public release at a breakfast on the CC campus.
“I was very surprised by amount of student and visitor expenditures that we had,” Sood said.
When combined with operations, capital projects and visits from friends and family, the economic impact grows almost to that $168 million mark.
“That’s a lot of pizzas, planners and parents’ visits,” said college spokesperson Leslie Weddell.
Agriculture will be affected, other services will get affected. That’s the main idea.”
— Aradhya Sood,
CC economics student
Considering the ripple effect, or the amount of money spent and re-spent from the initial expenditure, “it’s huge,” Sood said.
Another term for the ripple effect is “multiplier.” The multiplier comes from the Bureau of Labor Statistics and Regional Input-Output Modeling System (RIMS) data, Sood said.
“Once you get these multipliers for the state, you use the direct impact, use the multipliers and see what the final effect is,” Sood said.
“In education, if you add anything to the economy, it’s going to affect all the other sectors in the economy. Agriculture will be affected, other services will get affected. That’s the main idea.”
Last summer, Sood worked for the office of CC President Jill Tiefenthaler, who holds a Ph.D. in economics. Tiefenthaler wanted to quantify the college’s impact in the community, Sood said.
“A lot of colleges and universities try to quantify their impact in their community,” Sood said, and the president “thought these questions needed to be answered.”
Tiefenthaler will lead a discussion on the study at the breakfast. For the study, Sood researched departments’ budgets, employee salaries and benefits, capital construction budgets and more.
She also surveyed 2,000 undergraduate and graduate students from academic year 2011-12, plus alumni.
Of those, 429 gave full responses and another 120 gave partial responses. The surveys asked a number of questions on how much money respondents spend and what they buy.
Sood extrapolated the results, using inflation rates from the Consumer Price Index to adjust the numbers for the years 2006-07 through 2010-11.
The same methodology was used in the expenditures from visitors to the college. It surprised Sood that the students reported they spent an average of $752 a month off-campus.
She was surprised the amount was so high because students are encouraged to live on campus for three years. That amount included rent, furniture, utilities, vehicle and any other expenses.
The operations-cost data in the study included the college’s expenditures with vendors outside the school, the report reads. Colorado College directly affects the economy by being in business, and because “different industries are inter-related in the economy, direct economic impact by Colorado College creates indirect and induced effects,” throughout the state, the report reads.
Operational impacts of $376 million during the course of five years from 2006-07 to 2010-11 created a total economic output of $598 million, Sood found.
CC operations added to the individual earnings of the people of Colorado, the report said. While the college spent $226 million on salaries and benefits to its employees during those five years of study, that created an additional $305 million in earnings in the state, Sood said. The total earnings multiplier of 1.35 suggests that for every $1 spent on the salaries and benefits of its employees, an additional 35 cents were added to the earnings of people in the state, the report said.
The college attracts grants that also affect the economy, the report said. During the study period, CC received $18 million in grants from the National Science Foundation, the National Security Agency, The Fulbright Program and others.
The study also found:
On average, Colorado College employed 1,361 full- and part-time faculty and staff each year during the five-year time frame, which created an annual average of 1,080 jobs in Colorado.
For every dollar the college spent on capital projects, another 83 cents were added to Colorado’s economy.
Student spending alone created an average of 150 jobs per year, or 751 jobs during the study period.
For every dollar the college spent on employee salaries and benefits, another 64 cents went to the earnings of other individuals in Colorado.
Parents, guests and alumni visitors spent $11 million over the five years studied. For every dollar they spent, another 30 cents were added to the Colorado economy. This translates into 36 jobs sustained in the economy for the five-year period.
On average, students volunteered 1,152 times annually, for an average of 15,440 hours per year. During the study’s time frame, CC students volunteered 5,759 times for a total of 77,202 hours, which equates to 37 full-time service workers.
Sood is now applying to graduate schools, where she wants to earn her Ph.D. in economics.