VSU’s Economic Impact Expected to Increase with Implementation of New Strategic Plan
Thursday, August 29th, 2024
How much does Lowndes County and the surrounding areas benefit economically from hosting Valdosta State University?
That is the question the Selig Center for Economic Growth at the University of Georgia’s Terry College of Business set out to answer in a recent study commissioned by the Board of Regents of the University System of Georgia — The Economic Impact of University System of Georgia Institutions on their Regional Economies in Fiscal Year 2023.
Dr. Jeffrey M. Humphreys, director of the Selig Center for Economic Growth, noted that VSU’s total economic impact on its host region — defined as Lowndes, Brooks, Lanier, Berrien, Cook, and Echols counties — between July 1, 2022, and June 30, 2023, was, in the simplest and broadest possible terms, a little more than $394.6 million. This includes the creation of 3,691 total jobs, of which 2,415 are off-campus jobs in the public and private sectors.
“With an economic impact of more than $394.6 million, we are an integral part of the lifeblood of Valdosta, Lowndes County, and surrounding areas, and we understand the active role we play in lifting our people and communities,” said Dr. Richard A. Carvajal, president of Valdosta State University. “What we do at VSU is critical to the economic growth and vitality of South Georgia, and we take that responsibility very seriously.
“With our new strategic plan, VSU2030, we renew our commitment to creating career-ready graduates and aligning our programs with student and employer demand, building our on-campus student community, maximizing our growth through targeted recruitment strategies across the nation and around the world, and making the investments needed to secure our university’s long-term future. We know that our success is South Georgia’s success, and that inspires us to do the hard work necessary to continue our impact.”
Humphreys’ report provided additional information about the economic impact of spending by VSU as an institution of higher education, by VSU employees, and by VSU students.
Initial Spending — $323,643,975
According to the report, total initial spending accruing to VSU’s regional economy is the combination of three types of spending — spending by the university for personnel services, spending by the university for operating expenses, and spending by the university’s students.
Spending originating from personnel services accounted for about 29.1 percent ($94,271,258) of initial spending during Fiscal Year 2023. Spending due to operating expenses accounted for about 21.2 percent ($68,615,192) of initial spending. Student personal expenditures accounted for about 49.7 percent ($160,757,525) of initial spending.
Total Output Impact — $394,650,488
According to the report, output impact was calculated for each category of initial spending, based on the impact of the first round of spending and the impacts generated by the re-spending of these amounts — the multiplier effect. Total output impacts are the most inclusive, largest measures of economic impact.
Of VSU’s total output impact, 82 percent ($323,643,975) was initial spending, while 18 percent ($71,006,513) was the induced/re-spending impact or multiplier effect, or the difference between output impact and initial spending. The multiplier captures the regional economic repercussions of the flows of re-spending that take place throughout the region until the initial spending has completely leaked to other regions.
On average, every dollar of initial spending generated an additional 21.9 cents for the economy of VSU’s host region during Fiscal Year 2023.
Total Value-Added Impact — $265,698,965
According to the report, value-added impacts, which exclude expenditures related to foreign and domestic trade, provide a much more accurate measure of the actual economic benefits flowing to businesses and households in VSU’s host region than the more inclusive output impacts.
VSU’s value-added impact equaled about 67.3 percent of its $394.6 million output impact, with foreign and domestic trade comprising the remaining 32.7 percent of the output impact during Fiscal Year 2023.
Labor Income Impact — $166,160,394
According to the report, VSU generated a labor impact on its host region of $166,160,134 in Fiscal Year 2023. The labor income received by Lowndes County and neighboring communities represents 62.5 percent of the value-added impact.
Employment Impact — 3,691
According to the report, the economic impact of hosting VSU is most easily understood in terms of the university’s impact on employment. VSU generated an employment impact of 3,691 jobs in Lowndes County and surrounding communities in Fiscal year 2023.
Approximately 34.6 percent (1,276) of these positions are on-campus jobs, while 65.4 percent (2,415) are off-campus jobs in the public or private sector that exist due to VSU-related spending.
In his report, Humphreys stated, “These economic impacts demonstrate that continued emphasis on colleges and universities as a pillar of the state’s economy translates into jobs, higher incomes, and greater production of goods and services.”
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