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Economic Impact of Scotland's Colleges: Creating Income, Jobs, and a Brighter Future

This report highlights the economic impact of Scotland's colleges, showcasing their role in stimulating regional economies, creating income, and increasing lifetime earnings for learners. It also emphasizes the significant cost savings and quality of life improvements brought about by these institutions.

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Economic Impact of Scotland's Colleges: Creating Income, Jobs, and a Brighter Future

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  1. Economic Impact of Scotland’s Colleges September 10, 2015

  2. on the agenda… Background to set the stage: our “credentials” 1 Differences in economic impact studies—understand the context for the economic impact results and what they mean 2 3 Results: A broad overview of the results followed by Q & A

  3. 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”

  4. 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

  5. differences in impact studies

  6. introduction to results Aggregate study, 26 FE colleges 1 Total revenue: £658 million 2 3 Served approximately 270,000 learners 2013/14 Demographics: 48% male, 52% female, 85% white, 15% minority, average age 17 years 4

  7. the EMSI study Two components added workforce skills taxpayer learner College and staff expenditures society Scottish impact (region) Stakeholder investment

  8. impacts of Scotland’s Colleges measured against GDP Objective: measure how much of GDP is attributable to the colleges NET LEARNER SPENDING STAFF AND COLLEGE EXPENDITURES ADDED WORKFORCE SKILLS Scotland’s GDP £170 billion

  9. results:total impact £14.9B/year £14.9B/year total 8.8% of all Scottish income + 593K average wage jobs Staff and college expenditure impacts £700.8M Added workforce skills impacts £14.2B

  10. results:learner perspective 15% 12% 11% £34,000 8% £23,000 ++ 5% £20,000 £18,000 ++ £17,000 SVQ 2 SVQ 3 SVQ 1 >SVQ 3 Entry Average income at career midpoint and unemployment rates

  11. results: investment analysis learner perspective B/C = 6.3 • tally up higher earnings • tally up tuition + opportunity cost of time IRR = 14.8% social perspective (broad) B/C = 6.3 • tally up higher earnings + avoided costs • tally up all costs to society IRR = 16.4% taxpayer perspective (narrow) B/C = 5.7 • tally up increased tax collections + avoided costs • tally up taxpayer investments IRR = 15.6%

  12. 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

  13. Moving the needle in the future….

  14. Q & A ? Kjell Christophersen, Founder and Chief Economist, EMSI kjell@economicmodeling.com, +1 208.882.3567

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