Higher Education as an Economic Enterprise

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Presented to the Utah Legislature's Economic Development Task Force on 11/15/12

Presented to the Utah Legislature's Economic Development Task Force on 11/15/12

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  • 1. Economic Development Task Force David Buhler, Commissioner of Higher Education November 15, 2012
  • 2. Introduction/Overview 1. Directly as a large enterprise 2. Creation of Innovation 3. Expanding the Talent Pool 4. Partnering with Business and Industry 5. Strategies for Our State 2
  • 3. 1) Higher Ed as an Enterprise 3
  • 4. A $4.5 Billion Enterprise Tuition/Fees, $592, 409,100 State Appropriations, $7 03,119,511 EverythingElse, $3,231,202,1 87 4
  • 5. Leveraging State DollarsUSHE provides $2.6 for every state dollar of capital development Donations & Federal, $1,103, 629,900State Funds Other$968,433,400 $2,476,873,600 28% 72% Revenue Bonds $1,255,477,400 Student Fees $117,766,300 USHE Capital Funding by Source (1996-2012) 5
  • 6. A major employer USHE Institutions 33,162 Tax funded: 15,204 Other: 17,958 Intermountain Healthcare: 32,000 State of Utah: 25,000 Hill Air Force Base: 15,000 Wal-Mart (in Utah): 20,000 6
  • 7. 2) The Creation of Innovation 7
  • 8. Creation of Innovation Basic Research and USTAR (since 2005) • 202 patents (106 UU, 96 USU) • 330 disclosure (142 UU, 188 USU) • 120 startups at University of Utah Applied Research • Support for gov’t and business on specific projects • All institutions participate in applied research in varying degrees – Example: Bureau of Economic and Business Research 8
  • 9. Just like these innovators… John Warnock David Evans Ivan Sutherland Adobe Evans & Sutherland Ed Catmull Tom Stockham Alan Kay Pixar/Disney Soundstream Xerox/Apple
  • 10. Inspiring the Next Generation of Entrepreneurs 10
  • 11. 3) Expanding the Talent Pool (Preparation, Participation, Completion) 11
  • 12. Expanding the Talent Pool • By 2018, 66% of jobs in Utah will require postsecondary education. • Utah is currently at 43%. • 20 highest-paying occupations in Utah currently require at least a Bachelor’s degree. 12
  • 13. Expanding the Talent Pool Increase degrees 4% annually to reach 66% 47,000 45,000 43,000 41,000 12,100 39,000 10,300 8,600 37,000 7,000 5,500 4,000 35,000 2,600 1,300 33,600 33,600 33,600 33,600 33,600 33,600 33,600 33,600 33,600 33,000 2011-12 2012-13 2013-14 2014-15 2015-16 2016-17 2017-18 2018-19 2019-20 Utah Base USHE 13
  • 14. More Participation Needed… • Enrollment growth is not keeping up with population growth • Between 1994 and 2009: – Youth (18-24) population grew 40% – First time freshmen enrollment grew 20% • 49% of 18-24 year olds not enrolled in college 14
  • 15. Socioeconomic Status a Predictor of Success • Utah High School Graduation Rates (2011) – All Students: 76% – White: 80% (6,448 not graduating) – Hispanic: 57% (2,592 not graduating) – Econ. Disadvantaged: 65% (4,209 not graduating) 15
  • 16. Socioeconomic Status a Predictor of Success Utah high school graduates who enroll in college by income 80.0% 71.1% 70.1% 70.0% 67.7% 60.0% 51.6% 49.9% 48.8% 50.0% 40.0% 30.0% 20.0% 10.0% 0.0% 2007 2008 2009 Regular Low Income (Free or Reduced Lunch in High School) 16
  • 17. Benefits of Higher Ed are Undeniable 8.2% 7.6% $59,843 5.5% $41,273 $30,632 4.1% $26,355 $19,316 1.4%Less than High School Diploma High Some College, Certificates & Associates Degrees School Diploma Bachelors Degree Graduate Degree Median Wage Unemployment Rate Sources: American Communities Survey 2009, Utah Department of Workforce Services 17
  • 18. Benefits of Higher Ed to the Economy Utah Population (25 & over) by education level & state tax contribution 48% Taxes Paid Population 40% 38% 34% 28% 12% No Postsecondary Education Some College, Certificates & Associates Degrees Bachelors & Higher 18
  • 19. Benefits of Higher Ed to the EconomyIf Utah reaches the 66% goal:• Wage income would increase annually by between $1.5B and $3B annually.• 5%-10% increase in total state wage share of GDP. Source: Dr. Jeff Strohl, Center on Education and the Workforce, Georgetown University 19
  • 20. 4) Partnering with Business 20
  • 21. Engaged Experiential Learning• Business partners housed at USHE institutions provide critical geographic hubs: – USTAR (Regional outreach) – Small Business Administration – GOED (Rural Development, Fast Track, etc.) – Procurement Technical Assistance (PTAC) – Cluster Acceleration Partnership – Small Business Development Center (SBDC) – Etc…. 21
  • 22. Engaged Experiential Learning• Resulting in enriched student experience relevant to the regions/industries – Internships – Undergraduate and Applied Research – Business Incubation – Business and Entrepreneur resources (market research, capital, consulting) 22
  • 23. Working with industry to align outcomes: • Regional tech outreach partnership with USTAR – WSU, SUU, Dixie, UVU, USU East • New certificates in high growth/high wage industries – aerospace, life science, health care • Economic Gardening (USU, Snow, SUU, Dixie) • Goldman Sachs - 10,000 small businesses (SLCC) • Custom fit/CTE realignment (Snow) 23
  • 24. 5) Strategies for our State 24
  • 25. Are we as wise as our founders? University of Deseret Southern Utah University Originally housed in the first Mortgaged surrounding farm public building built in the state. properties to sustain the campus after fire destroyed Old Main in 1948. 25
  • 26. Who pays? Funding per FTE Funding per FTE 2008 2012 Tuition Tax Tuition Tax Funds 37% Funds 51% 49% 63% Tuition is up, yet spending is $600 less per student 26
  • 27. The 66% Goal: How? Utah Needs a Bold, New Plan • Increased Innovation • Increased Investment • We won’t get there by maintaining the status quo
  • 28. How do we get to 66%? 28
  • 29. The 66% Goal: How? Innovation • Leverage technology • Broaden reach to K-12 students • College readiness • 1st generation college-goers • Focus on industry needs • STEM & Health Professions
  • 30. The 66% Goal: How we get there Investment in Capacity and Completion • Year 1 of 7-year plan • Invest in STEM & health professions • Student preparation for high-income careers • Build teaching/completion capacity
  • 31. The 66% Goal: How? Investment in Capacity and Completion $30M increases capacity in critical programs + $10M scholarships to assist in completion _________________________________ Total: $40 million investment
  • 32. The 66% Goal: How? $20/$20 Investment Plan $20M state contribution + $20M institutional innovation & investment _________________________________ Total: $40 million investment
  • 33. Investing in our Children’s Futures• Not simply a new budget request• It will take everyone: K-12, higher ed, business & state• We need your support!
  • 34. Summary 1. Higher Ed is a large enterprise. 2. Higher Ed is critical to innovation. 3. We must expanding capacity to expand the talent pool. 4. Continue building partnerships with business and industry. 5. Strategies for our state require support of all stakeholders. 34
  • 35. Thank YouQuestions/Discussion 35