By Dante Chinni
The nation’s attitudes toward higher education have grown complicated in recent years. Increasingly, many Americans have become skeptical of the importance of a bachelor’s degree, particularly Americans who lean Republican in their politics.
And the Trump administration has largely elevated that skepticism, cutting or revoking already-issued federal grants in a variety of areas, including medical research to the tune of more than $160 billion. At the same time, the administration is threatening deeper cuts and criticizing diversity, equity, and inclusion programs at institutions.
But the nation’s college and universities are more than just educational hubs for the next generation, they are economic drivers in small towns and big urban centers around the country. And an analysis from the American Communities Project and the Economic Innovation Group, a bipartisan public policy organization, finds two points are generally true:
Communities with a college or a university tend to have higher per capita GDPs than neighboring communities.
Communities with big, “tier 1” research universities that receive big government grants, generally do even better with their per capita GDP than similar communities.
The data suggest that the spin-off commerce created by the schools has an outsized impact on their communities, big and small, all over the country. And cutting funds to the nation’s institutions of higher education is likely to have larger impacts that will be felt on and off campuses in the months and years ahead.
What Is a College Town?
Colleges and universities don’t exist as islands; communities grow up around them to serve them. Some of these communities are considered College Towns in the ACP — places where the college or university, or sometimes more than one, defines the locale.
There is a range of College Towns in the ACP rubric. Some are populous counties where one big university dominates, such as Boulder County, Colorado, home of the University of Colorado. Some are smaller counties where a smaller school has a disproportionate impact, such as Buncombe County, North Carolina, home of UNC Ashville. And some house several smaller campuses, such as Dauphin County, Pennsylvania, home of Susquehanna University, York College, and Lebanon Valley College.
But overall, the data shows a clear story. The College Towns in the American Communities Project have a higher per capita GDP than the counties around them. And the effects are even larger for “tier 1” research schools, the 187 institutions that are classified as having “very high research spending and doctorate production” in the Carnegie Classification of Institutions of Higher Education.
In College Towns without “tier 1” schools (communities with smaller schools or collections of small schools), the per capita GDP was more than $7,000 higher than it was in surrounding non-College Town counties.
And in College Towns that are home to a big research schools, the impacts are much bigger. The per capita GDP in those counties is $16,000 higher than the surrounding non-College Town counties
Regardless, the takeaways from the data are hard to ignore: College Towns tend to be economic drivers for their broader regions. Some of this business serves students — restaurants, bars, stores — but part of it is the impact of the institutions themselves. Colleges and universities hire a lot more than professors. There are student support staff, maintenance staff, HR staff, and other university workers.
When the federal government cuts money to those institutions, all those employees take a hit. Less scholarship money and grants may also lead to fewer students, which means local businesses suffer.
You can read this full report and see our video talking to college students at Michigan State University at the American Communities Project site.
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