Analysis of the Economic Impact and Return on Investment of Education
T H E E C O N O M I C V A L U E O F H O L L A N D C O L L E G E
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Section titled “Document text”HAT
HOLLAND
COLLEGE
Analysis of the Economic Impact and Return on Investment of Education
Section titled “Analysis of the Economic Impact and Return on Investment of Education”T H E E C O N O M I C V A L U E O F H O L L A N D C O L L E G E
April 2018
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. Emsi Prince of wat
Executive summary
Section titled “Executive summary”Holland College (HC) creates value in many ways. This study investigates the economic impacts created by HC on the provincial economy and the benefits that the college generates in return for the investments made by its key stakeholder groups-students, society, and taxpayers.
The value of HC influences both the lives of students and the Prince Edward Island economy. The college serves a range of industries in Prince Edward Island and supplies local businesses with skilled workers. Society as a whole in Prince Edward Island benefits from an expanded economy and improved quality of life. The benefits created by HC extend as far as the provincial government, in the form of increased tax revenues and public sector savings.
This study investigates the economic impacts created by HC on the business community and the benefits that the college generates in return for the investments made by its key stakeholder groups-students, society, and taxpayers. For the purposes of this study, the region the college serves is Prince Edward Island. The following two analyses are presented:
- Economic impact analysis
- Investment analysis
All results reflect student and financial data for fiscal year (FY) 2016-17. Impacts on the provincial business community are reported under the economic impact analysis. Results are measured in terms of added income. The returns on investment to students, society, and taxpayers are reported under the investment analysis. Both analyses are described more fully in the following sections.
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Economic impact analysis
Section titled “Economic impact analysis”HC promotes economic growth in Prince Edward Island in a variety of ways. In FY 2016-17, the college employed 533 full-time equivalent employees. The college spent a total of $35.8 million on payroll and an additional $23.3 million to support its operations. HC is a primary source of education to provincial residents and a supplier of trained workers to provincial industries, and the living expenses of students benefit local businesses.
OPERATIONS SPENDING IMPACT
Section titled “OPERATIONS SPENDING IMPACT”HC is an important employer in Prince Edward Island. All of the college’s employees live in the province, and much of their spending on groceries, eating out, clothing, and other household expenses impacts the provincial economy. Additionally, HC is itself a large-scale buyer of goods and services. Each year, the college spends millions of dollars in Prince Edward Island to cover its day-to-day expenses for facilities, professional services, and supplies.
The total income that HC created during the analysis year as a result of its day-today operations was $42 million, which is equivalent to supporting 613 jobs in the province. This figure represents the college’s payroll, the multiplier effects generated by the spending of the college and its employees, and a downward adjustment to account for funding that the college received from provincial sources.
APPLIED RESEARCH SPENDING IMPACT
Section titled “APPLIED RESEARCH SPENDING IMPACT”Applied research activities impact the economy by employing people and requiring the purchase of equipment and other supplies and services. These efforts attract new dollars to the province and support economic development in Prince Edward Island.
In FY 2016-17, HC spending on applied research and development activities created a net total of $1.2 million in added income for the provincial economy. This is equivalent to supporting 17 jobs.
STUDENT SPENDING IMPACT
Section titled “STUDENT SPENDING IMPACT”Hundreds of students, including international students, relocated to Prince Edward Island to attend school at HC in FY 2016-17. In addition, a number of in-province students would have left the area for other education opportunities if not for the existence of HC. While attending, these relocated and retained students spent $22.7 million to purchase groceries, rent accommodation, pay for transportation, and so on. A significant portion of these expenditures occurred in the province, generating $10.6 million in new income in the economy during the analysis year, equivalent to supporting 271 jobs.
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TABLE 1: Impacts created by HC in FY 2016-17
| ADDED INCOME | JOBS | |
Source: https://hollandcollege.com/assets/documents/presidents-office/hc_execsum_1617_sm.pdf