Economic impact

By Danielle Rush
Tribune staff writer

June 10, 2009 09:35 pm

— You would expect Indiana University Kokomo to have an impact on its region, which includes Howard County, in granting degrees to area residents.
However, you might be surprised to know the campus has an economic impact of more than $22 million on north central Indiana, and that economic activity generated about $627,000 in state and local taxes.
The campus also impacts north central Indiana in less tangible ways, by offering service learning opportunities, community service and charitable contributions from students, faculty and staff, and also amenities such as programs in Havens Auditorium, the art gallery and the library.
Indiana University recently released the results of an impact study conducted by the Indiana University Research Center at IU’s Kelley School of Business. The study included the economic impact of Indiana University statewide and the eight regional campuses. The study examined the employment and economic significance of spending by the university, students and visitors, and estimates the effects of direct expenditures, such as purchases and faculty salaries, and the “ripple effect” of those purchases in the community.
It also considers other areas of contribution to the community, such as volunteer service and donations to local charities. IU Kokomo’s contribution was more than $123,000.
Paul Nowak, vice-chancellor for external affairs at IU Kokomo, said the study provided “a much bigger picture than what we normally look at” in terms of community impact.
He said locally, administrators tend to focus on educating students and graduating them. He said this is the first time he is aware of an economic impact study being performed for the Kokomo campus.
He said what stood out to him in the study was the increased earning power of the students who earn a bachelor’s degree.
A typical male graduate can earn $1.8 million during his lifetime, and a female graduate $1.3 million during her lifetime, according to the study, which is 39 percent and 30 percent higher than those earning associate degrees.
Nowak said it’s also important to note that 76 percent of IU Kokomo graduates live in the university’s seven county primary service region, which includes Howard, Tipton, Miami, Cass, Carroll, Clinton and Grant counties. As of 2008, 87 percent of IU Kokomo graduates who earned their degrees between 1998 and 2002 resided in Indiana, he said.
The most common Indiana counties of residence for those graduates are Howard, Cass and Miami counties. Hamilton County is the next most popular county of residence, he said.
Nowak said another important part of the impact is what the students and employees contribute to the community, past the academics, in terms of human capital and civic engagement.
The study valued service learning opportunities, such as the “Take Back the Night” event opposing violence against women, at $27,200, and student, faculty and staff volunteerism at $96,100.
According to the study, IU Kokomo students volunteered an average of 88 hours during the 2006-2007 academic year, for a total of 125,000 hours, mostly within the campus region. Religious activities comprised a third of the activity. Students also served in arts and recreation instruction, school volunteering, child tutoring and animal care.
Faculty and staff members volunteered an average of 59 hours during the 2006-2007 academic year, and many serve in administrative capacities in local organizations.
IU Kokomo also offers amenities such as the campus bookstore, programs in Havens Auditorium, shows in the art gallery, the career resource center, the childcare center and others, that benefit the community, he said.
The $22 million financial impact, Nowak said, is essentially the campus operating budget, which pays faculty and staff salaries, university purchases and construction, among other items.
According to the study, this economic activity generates about $627,000 in state and local taxes, and faculty and staff spending, together with direct university purchases and construction projects, result in ripple effects of about $3 million in additional economic activity and accounts for about 30 jobs in the region.
Nowak said the information from the study can be used in marketing the university and to remind state legislators how the campus contributes to north central Indiana, as they consider higher education funding for the Kokomo campus and statewide.
“It’s important to use it as well as we have conversations with our state legislators as they head into their special session. There are some very tough decisions they’re going to have to make.”
• Danielle Rush is the Kokomo Tribune education reporter. She can be reached at (765) 454-8585 or danielle.rush@kokomotribune.com

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