A new study by the Boyd Center for Business and Economic Research shows the University of Tennessee’s Knoxville campus generated $1.7 billion in annual income to the state’s economy in 2017.
The UTK researchers at Boyd calculated revenue and expenditure data to determine how much income, how many jobs and how much state and local tax revenue were generated from UT-related spending in Tennessee. The total of jobs supported: 35,000.
Impact wasn’t divvied up according to the state’s 95 counties in the study conducted by Bill Fox, director of the Boyd Center, and Lawrence Kessler, research assistant professor. But the proximity of Blount County to UTK and the home-grown business opportunities from Alcoa to Maryville and beyond all but ensure the economic impact of the state’s land grant university is substantial on the south side of the Little River embayment.
That’s the conclusion of Matt Murray, who didn’t have a hand in this study but has more than three decades of experience in crafting economic research at the university. As a UT professor of economics and associate director of the Boyd Center, he’s compiled too many numbers to count, but he didn’t need a calculator to characterize the impact on Blount when the new study was released Monday.
As current vice chair and former chair of the Economic Development Board of Blount County, he’s seen and heard the financial benefit of UTK with his own eyes and ears.
“I think that its impact on Blount County is really substantial,” Murray said. “Blount County sends a significant number of students to UT for education and training. And the county benefits greatly from individuals who work at the university and who spend money in Blount County.”
Not only that, Blount is part of the supply chain that keeps the university humming by providing products and services generated here or routed through Blount County. Part of that stems from the businesses and entrepreneurs who would not be attracted to the county if not for the nearby presence of the university, Murray said.
“UT is a very important means of promoting economic development, in attracting people and businesses,” he said.
That brings technical expertise to Blount, but the university also offers benefits beyond numerical calculations, he said.
“UT offers amenities in terms of athletics, in terms of music, in terms of entertainment in general. It greatly improves the quality of life in Blount County,” Murray said.
By the numbers
Of the the new students arriving at UTK this academic year, about 200 are from Blount County. That ranks Blount No. 7 among Tennessee counties for freshmen, No. 3 for transfers and puts it No. 6 overall in terms of new students at the university.
The dollar impact of those students will come in future studies. As for 2017, the $1.7 billion statewide economic contribution is up $100 million since the last report was produced in 2015 and up more than $785 million over the past 10 years, according to a UT news release.
It starts with the people, the release states. More than 10,000 people are employed by UT, which paid out $575 million in salaries and benefits.
Each dollar spent by employees triggers more than $1 in economic activity, according to the principle of economics known as the multiplier effect. The report shows that UT spending supports 35,232 full-time jobs in Tennessee.
Wayne Davis, interim chancellor at UTK, noted that money doesn’t stay in employee’s pockets.
“When our employees spend their paychecks, they’re buying homes, groceries and other goods that support local jobs and in turn create income for those business owners and workers,” Davis said.
Non-payroll spending such as construction, utilities, equipment, supplies and maintenance repairs totaled $636 million and accounted for 42 percent of in-state university spending. Campus projects worth more than $1 billion are currently undergoing design, planning or construction.
Student and visitor spending, by those attending sporting events, special events and conferences, accounted for $288 million.
Beyond the numbers
Fox pointed out that the raw numbers are not the only calculation of UTK’s contribution.
“It’s important to note that the study measures only the impact that the production of education at UT has on the state’s economy,” Fox said. “It does not account for the effect that education has on the future of our graduates or their participation in the state’s workforce and economy.”
Murray, speaking to The Daily Times, brought that home Monday.
“The benefit of UT to young people and to the entire community is greatly important to the economic development of Blount County.”