Community colleges have a profound impact on local and regional economies. To scientifically document this impact, the 16 Maryland community colleges contracted with Economic Modeling Specialists, Inc. (EMSI) to conduct economic impact studies for each college and the group as a whole. This article presents the highlights of the economic impact of Carroll Community College on Carroll County.
The EMSI report had two components, a study of the economic impact of the college on the County, and an investment analysis of the returns earned by students and taxpayers.
The college’s economic impact includes the payroll it pays its employees, the money it spends for goods and services, the spending of current students in the County, and the impact of thousands of its alumni who work and live in Carroll County.
In FY16, the study year, the college employed 661 employees with a payroll of $28.6 million. Two-thirds of the employees lived in Carroll County. The college also spent $9.2 million on goods and services. Net operational spending, excluding governmental contributions to the college, was $29.9 million. The college’s 12,000 students spent an additional $3.2 million in Carroll County.
Many alumni of the college live and/or work in Carroll County. They earn higher wages and pay more taxes because of the education they gained at the college. Their skills contribute to the output of businesses in the County. Altogether, the alumni impact in 2015-16 was estimated to be $74.3 million.
Thus the college’s total impact on Carroll County in 2015-16 was $107.5 million. This was equivalent to supporting 2,279 jobs. The top three industries supported by the college were health care, manufacturing, and professional services.
From an investment perspective, students pay for tuition and fees, books, supplies, and other expenses, plus forgo wages they would have earned from employment they give up to attend college. Altogether, students in 2015-16 invested $59 million to attend Carroll. Because of their Carroll education, they will earn higher wages throughout their working lives. The present value of these future earnings was estimated to be $125.9 million. Thus for every dollar a student invested, they receive $2.10 in future earnings.
Taxpayers invest in the college through the funding contributions of the State and County. In 2015-16 this investment was $18.2 million. In return, the County gets an educated workforce that has higher earnings, pays more taxes, and makes business more productive. The present value of these higher tax receipts and business output was estimated to be $31.4 million. In addition, higher education is strongly correlated with improved health, reduced crime, and lower unemployment. These “lifestyle” benefits reduce governmental spending and saved taxpayers an estimated $3.4 million. Total return to taxpayers in 2015-16 was thus a net present value of $34.9 million. For every dollar invested by taxpayers, they receive $1.90 in return.
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