presentation by a. hecht (wlu) and s. mayer (laurentian university) on the occasion of a visit by

"The socio-economic impact of universities on local regions:A centralized empirical approach for Canada".

Presentation by

A. Hecht (WLU) and S. Mayer (Laurentian University)

On the occasion of a visit by

Russian University Presidents, Academics and Legislators

to Wilfrid Laurier University

May 27, 2005

Abstract

It is generally believed that universities have a positive influence on the local region in which they are located. They produced an educated labour force, attract potential employers, use the local infrastructure and their students bring substantial funds to the local community. Employees of the university themselves are relatively well paid, have substantial job security and contribute financially greatly to the local environment. They are in fact growth poles for the surrounding environment.

Major influences of Universities in North America

• University mechanisms that may encourage local growth*

– as Trainer (provider of skilled labour for the local market)

– as Innovator (generator of local commercial knowledge)

– as Partner (with local commercial firms)

– as Regional Talent Magnet (attract firms to work with profs/students and profs/students may establishing local firms)

– as Facilitator (of local entrepreneurial networks)

– as Exporter of Knowledge (graduates, patens, consulting services, etc.) – as Importer of Capital (student and government fees, student living expenses, grants)

______________________________*Source: J.R.Betts and C.W. Lee, “Universities as drivers of Regional and National Innovation an Assessment of the Linkages from Universities to Innovation and Economic Growth” in Beach,C.M. R.W. Broadway, and R.M. McInnis, Higher Education in Canada, Montreal: McGill-Queen’s University Press, 2005, pp 113-157.

and Meyer, S. and A. Hecht, “University growth poles in Canada: An Empirical Assessment”, Canadian Journal of Regional Science, Vol. XIX, 3, 1996, 263-282

Socio economic Well Being in the Waterloo Region and Ontario

characteristics Waterloo Kitchener Cambridge Ontario

% Population growth 1996-2001 11 6.7 8.8 6.1

% of the population with a U. cert. dip.or degree

Age 20-34 37.2 19.2 13.5 25.7

Age 35-44 36.4 18.8 13.4 24.3

Age 45-64 31.5 16.4 12.1 21.5

Average earnings (all persons with earnings ($) 39429 31325 33505 35185

Median income,15 years and over ($) 28631 25054 25420 24816

% Labour part. rate, 15 years and older 72.1 71.4 71.3 67.3

% in Manufacturing and construction 23.48 32.61 39.09 21.97

% in FIRE, Health, Education, Business serv. 47,08 35.95 30.16 40.89

Average value of dwelling ($) 193829 157719 168719 199884

Source: http://www12.statcan.ca/english/profil01/PlaceSearchForm1.cfm

Wilfrid Laurier University Local Impact Analysis for 2004/5 (in ,000 of $)

A. Direct Financial inflow Total Local Adjacent Periphery Periphery Periphery

to the University (in ,000 of $) Waterloo R Wellington Ontario Other CDN World

Source of Students 10,775 1901 330 8165 16 363

Tuition Fees 55,420 8,980 1,550 41,000 1,170 2,720

Government operating grant 50,270 8,146 1,406 37,190 1,061 0

Other (Grants, etc) 900 900

Total Direct 104,123 17,126 2,956 78,190 3,131 2,720

University local multiplier is ~1.6

Total plus multiplier 166,596 27,401 4,730 125,104 5,010 4,352

B. Direct Students Expenditures (in ,000 of $)

books (1000/student) 10,775 1,901 330 8,165 16 363

food (400/month - 8 month) 28,396 - 1,055 26,128 53 1,161

accommodation (500/month - 8 month) 35,118 - 942 32,660 66 1,451

incidentals (300/month - 8 month) 21,297 - 791 19,596 40 870

Total Direct 95,586 1,901 3,118 86,548 175 3,844

Student local multiplier is ~1.6

Total plus multiplier 152,938 3,042 4,988 138,477 280 6,151

Total financial impact to the Waterloo Region for the 8 month is 319.53 million

Source: basic figures from Wally Pirker Internal Auditor/Institutional Research Officer

Wilfrid Laurier University and calculations were done by Al Hecht (some data is estimated)

CDs Socio-Economic Well Being Conditions: Total vs. CDs with Universities

in the Maritimes and Quebec

1996 2001

CDs Ave. CDs with U's CDs Ave. CDs with U's

Maritimes

Median Income $19,025 $16,195 $17,797 $18,028

Average Household Value $72,540 $87,763 $81,195 $90,943

Employment Rate 49.08% 54.01% 50.93% 52.36%

Quaternary Labour Rate 37.26% 45.09% 36.42% 39.43%

Population Change -0.20% 1.92% -1.25% -1.78%

Manufacturing Labour Rate 13.22% 8.55% 16.83% 16.70%

Quebec

Median Income $16,439 $17,020 $19,430 $19,529


Employment Rate 52.67% 53.77% 56.17% 52.36%


Population Change 3.80% 2.25% 0.75% -0.98%


Source: Statistics Canada, 1996 Census, http://tdr.uoguelph.ca.libproxy.wlu.ca/cgi-bin/drc.cgi/other

CDs Socio-Economic Well Being Conditions: Total vs. CDs with Universities

in Ontario and the West

1996 2001

CDs Ave. CDs with U's CDs Ave. CDs with U's

Ontario

Median Income $19,490 $19,807 $22,785 $23,020


Employment Rate 58.45% 58.42% 60.47% 60.38%


Population Change 4.79% 3.75% 2.53% 1.91%


Western Canada

Median Income $17,049 $18,567 $19,574 $21,645


Employment Rate 62.17% 63.88% 62.66% 64.99%


Population Change 4.77% 3.59% 1.59% 3.34%



Socio-Economic Well Being in Census Divisions of the Maritimes, 2001

Population Employment Quaternary Manufacturing Median Average

N Change Rate Labour Rate Labour Rate Income House Value

CDs with Universities 9-1.78% 52.36% 39.30% 16.70% $ 18,028 $ 90,943

Adjacent CDs 19-2.39% 53.05% 34.81% 23.83% $ 20,207 $ 81,835

Peripheral CDs 18-6.55% 45.08% 36.83% 13.08% $ 15,646 $ 71,665


Socio-Economic Well Being in Census Divisions of Quebec, 2001



CDs with Universities 6-0.98% 55.52% 43.83% 17.62% $ 19,529 $ 87,899

Adjacent CDs 19-1.54% 53.87% 36.21% 17.86% $ 18,920 $ 79,774

Peripheral CDs 180.20% 57.28% 35.18% 20.13% $ 19,652 $ 89,129


Socio-Economic Well Being in Census Divisions of Ontario, 2001



CDs with Universities 12 1.91% 60.38% 37.96% 16.64% $ 23,020 $ 146,760

Adjacent CDs 23 1.23% 59.93% 36.72% 16.12% $ 22,086 $ 128,696

Peripheral CDs 13 5.38% 61.52% 39.83% 14.92% $ 23,704 $ 145,196

Source: Statistics Canada, 1996 Census, http://tdr.uoguelph.ca.libproxy.wlu.ca/cgi-bin/drc.cgi/other (based on 48 to 0f 59 CDs)

Socio-Economic Well Being in Census Divisions in Western Canada, 2001



CDs with Universities 11 3.34% 64.99% 41.68% 8.15% $ 21,645 $ 136,394

Adjacent CDs 37 0.71% 65.08% 34.13% 6.96% $ 19,525 $ 103,530

Peripheral CDs 49 -0.54% 59.84% 35.85% 9.31% $ 19,360 $ 101,133


Socio-Economic Well Being in Census Divisions of the Maritimes,1996



CDs with Universities 91.92% 54.01% 45.09% 8.55%

$ 16,195 $ 87,763

Adjacent CDs 19-0.39% 47.99% 36.47% 15.12%

$ 14,671 $ 69,902

Peripheral CDs 18-2.54% 44.39% 35.71% 14.61%

$ 13,818 $ 64,821


Socio-Economic Well Being in Census Divisions of Quebec,1996



CDs with Universities 62.25% 53.77% 46.01% 11.99% $ 17,020 $ 85,846

Adjacent CDs 281.72% 50.84% 36.15% 17.16% $ 16,177 $ 73,542

Peripheral CDs 634.98% 53.52% 34.94% 20.23% $ 16,523 $ 83,155


Socio-Economic Well Being in Census Divisions of Ontario,1996




Adjacent CDs 233.80% 57.76% 37.85% 16.46% $ 18,886 $ 134,845

Peripheral CDs 157.28% 59.63% 40.60% 14.91% $ 20,210 $ 145,902


Socio-Economic Well Being in Census Metropolitan Areas of Western Canada,1996




Adjacent CDs 235.72% 63.70% 33.92% 6.82% $ 17,003 $ 101,181

Peripheral CDs 155.54% 60.42% 35.08% 8.73% $ 17,003 $ 100,034


Conclusion

Communities in Canada with Universities

- have produced higher average income in the local communities

- have produced more knowledge jobs

- have increase housing values

- have higher labour participation rates

- have normally less people in lowly manufacturing jobs

presentation by a. hecht (wlu) and s. mayer (laurentian university) on the occasion of a visit by

Documents

local growth

local environment

local regions

local infrastructure

local community

university local multiplier

university growth poles

economic growth