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Economic Impact of Scotland’s Colleges September 10, 2015 on the agenda… 1 Background to set the stage: our “credentials” 2 Differences in economic impact studies— understand the context for the economic impact results and what they mean 3 Results: A broad overview of the results followed by Q & A Colleges Scotland mission statement “Colleges Scotland is the collective voice of the college sector in Scotland; striving to create cohesive and sustainable partnerships, demonstrate positive impact, acting as representatives, and campaigning for the sector” background Economic impact studies: • 1,500 + US, UK, Canada, Australia • UK: 130 studies, of which 22 colleges have refreshed more than once, 1 university study + regional aggregates differences in impact studies introduction to results 1 Aggregate study, 26 FE colleges 2 Total revenue: £658 million 3 Served approximately 270,000 learners 2013/14 4 Demographics: 48% male, 52% female, 85% white, 15% minority, average age 17 years the EMSI study Two components Scottish impact (region) College and staff expenditures added workforce skills Stakeholder investment learner society taxpayer impacts of Scotland’s Colleges measured against GDP Objective: measure how much of GDP is attributable to the colleges STAFF AND COLLEGE EXPENDITURES NET LEARNER SPENDING Scotland’s GDP ADDED WORKFORCE SKILLS £170 billion results: total impact Staff and college expenditure impacts £ 700.8M total Added workforce skills impacts £ 14.2B £14.9B/year 8.8% of all Scottish income + 593K average wage jobs results: learner perspective 15% 12% 11% £34,000 8% £23,000 5% £20,000 £17,000 £18,000 ++ ++ Entry SVQ 1 SVQ 2 SVQ 3 >SVQ 3 Average income at career midpoint and unemployment rates results: investment analysis learner perspective • tally up higher earnings B/C = 6.3 • tally up tuition + opportunity cost of time IRR = 14.8% social perspective (broad) • tally up higher earnings + avoided costs B/C = 6.3 • tally up all costs to society IRR = 16.4% taxpayer perspective (narrow) • tally up increased tax collections + avoided costs B/C = 5.7 • tally up taxpayer investments IRR = 15.6% in summary… Scotland’s Colleges collectively… ✓ create new income and jobs in the country by stimulating regional economies directly and indirectly through added workforce skills ✓ save £ millions in social costs every year and improve the quality of life ✓ ✓ greatly increase the lifetime earnings of learners generate economic benefits far beyond taxpayer costs Moving the needle in the future…. Q&A ? Kjell Christophersen, Founder and Chief Economist, EMSI [email protected], +1 208.882.3567