Student spending impact
Both in-region and out-of-region students contribute to the student spending impact of UHV; however, not all of these students can be counted towards the impact. Of the in-region students, only those students who were retained, or who would have left the region to seek education elsewhere had they not attended UHV, are measured. Students who would have stayed in the region anyway are not counted towards the impact since their monies would have been added to the Coastal Bend economy regardless of UHV. In addition, only the out-of-region students who relocated to the Coastal Bend to attend the university are measured. Students who commute from outside the region or take courses online are not counted towards the student spending impact because they are not adding money from living expenses to the region.
While there were 4,370 students attending UHV in FY 2018-19 who originated from the Coastal Bend (not including dual credit high school students), not all of them would have remained in the region if not for the existence of UHV. We apply a conservative assumption that 10% of these students would have left the Coastal Bend for other education opportunities if UHV did not exist.14 Therefore, we recognize that the in-region spending of 437 students retained in the region is attributable to UHV. These students, called retained students, spent money at businesses in the region for everyday needs such as groceries, accommodation, and transportation. Of the retained students, we estimate 48 lived on campus while attending the university. While these students spend money while attending the university, we exclude most of their spending for room and board since these expenditures are already reflected in the impact of the university’s operations.
14 See Appendix 1 for a sensitivity analysis of the retained student variable.
Relocated students are also accounted for in UHV’s student spending impact. An estimated 333 students came from outside the region and lived off campus while attending UHV in FY 2018-19. Another estimated 160 out-of-region students lived on campus while attending the university. We apply the same adjustment as described above to the students who relocated and lived on campus during their time at the university. Collectively, the off-campus expenditures of out-of-region students supported jobs and created new income in the regional economy. 15
15 Online students and students who commuted to the Coastal Bend from outside the region are not considered in this calculation because it is assumed their living expenses predominantly occurred in the region where they resided during the analysis year. We recognize that not all online students live outside the region, but keep the assumption given data limitations..
The average costs for students appear in the first section of Table 2.10, equal to $12,174 per student. Note that this table excludes expenses for books and supplies, since many of these monies are already reflected in the operations spending impact discussed in the previous section. We multiply the $12,174 in annual costs by the 721 students who either were retained or relocated to the region because of UHV and lived in-region but off campus. This provides us with an estimate of their total spending. For students living on campus, we multiply the per-student cost of personal expenses, transportation, and off-campus food purchases (assumed to be equal to 25% of room and board) by the number of students who lived in the region but on campus while attending (208 students). Altogether, off-campus spending of relocated and retained students generated gross sales of $10.1 million in FY 2018-19. This figure, once net of the monies paid to student workers, yields net off-campus sales of $10 million, as shown in the bottom row of Table 2.10.
TABLE 2.10: AVERAGE STUDENT COSTS AND TOTAL SALES GENERATED BY RELOCATED AND RETAINED STUDENTS IN THE COASTAL BEND, FY 2018-19
|Room and board||$7,996|
|Total expenses per student||$12,174|
|Number of students retained||437|
|Number of students relocated||493|
|Gross retained student sales||$5,029,768|
|Gross relocated student sales||$5,037,845|
|Total gross off-campus sales||$10,067,613|
|Wages and salaries paid to student workers*||$113,010|
|Net off-campus sales||$9,954,603|
* This figure reflects only the portion of payroll that was used to cover the living expenses of relocated and retained student workers who lived in the region. Source: Student costs and wages provided by UHV. The number of relocated and retained students who lived in the region off campus or on campus while attending is derived by Emsi from the student origin data and in-term residence data provided by UHV. The data are based on all students.
Estimating the impacts generated by the $10 million in student spending follows a procedure similar to that of the operations spending impact described above. We distribute the $10 million in sales to the industry sectors of the MR-SAM model, apply RPCs to reflect in-region spending, and run the net sales figures through the MR-SAM model to derive multiplier effects.
Table 2.11 presents the results. The initial effect is purely sales-oriented and there is no change in labor or non-labor income. The impact of relocated and retained student spending thus falls entirely under the multiplier effect. The total impact of student spending is $6.2 million in labor income and $3.2 million in non-labor income. This sums together to $9.4 million in total added income and is equivalent to supporting 190 jobs in FY 2018-19. These values represent the direct effects created at the businesses patronized by the students, the indirect effects created by the supply chain of those businesses, and the effects of the increased spending of the household sector throughout the regional economy as a result of the direct and indirect effects.
TABLE 2.11: STUDENT SPENDING IMPACT, FY 2018-19
|Labor income (thousands)||Non-labor income (thousands)||Total income||(thousands)||Sales (thousands)|
|Total multiplier effect||$6,174||$3,181||$9,355||$16,386||190|
|Total impact (initial + multiplier)||$6,174||$3,181||$9,355||$26,341||190|
In FY 2028-29, UHV expects to serve 6,000 student FTEs. Using the average credit load of UHV students in FY 2018-19, this is equivalent to serving 9,947 students. Assuming that the proportion of students relocating to the region and in-region students remaining in the region is unchanged, the total net off- campus sales is expected to amount to $18.7 million in FY 2028-29. Table 2.12 presents the results. The initial effect is purely sales-oriented and there is no change in labor or non-labor income. The impact of relocated and retained student spending thus falls entirely under the multiplier effect. The total impact of student spending is $11.6 million in labor income and $6.0 million in non-labor income. This sums together to $17.6 million in total added income and is equivalent to supporting 358 jobs.
The total net impact of UHV’s student spending will increase from $9.4 million in added income in FY 2018-19 to $17.6 million in FY 2028-29.
Even though the number of students only grew by 84%, from 5,403 students in FY 2018-19 to 9,947 students in FY 2028-29, the impact from student spending will increase by 88%. The impact will increase from $9.4 million in added income to the Coastal Bend economy in FY 2018-19 to $17.6 million in added income in FY 2028-29.
TABLE 2.12: STUDENT SPENDING IMPACT, FY 2028-29
|Number of CHEs in workforce||772,242|
|Average value per CHE||$248|
|Initial labor income, gross||$191,362,047|
|Adjustments for counterfactual scenarios|
|Percent reduction for alternative education opportunities||15%|
|Percent reduction for adjustment for labor import effects||50%|
|Initial labor income, net||$81,328,870|