A major contribution

Southwest MN State University makes impact of more than $286 million to area economy, study says

File photo Southwest Minnesota State University students walked through the campus in this 2021 file photo. Minnesota State colleges and universities, including SMSU, had a sizable economic impact in the 2021 fiscal year, according to a study released this week. The Minnesota State system had an overall economic impact of $8.4 billion, and SMSU had an impact of $286.5 million, the study said.

MARSHALL — Higher education has a big impact on Minnesota’s economy, according to a study of Minnesota State colleges and universities released this week. At Southwest Minnesota State University, the impact was about $286.5 million — a figure that factored in everything from operational spending to employee pay and spending by university students and visitors.

In addition, SMSU supported 2,248 jobs, and generated more than $23.4 million in state and local taxes, the study said.

“Our regional partners understand the value that we bring to the community and broader region, and this report helps quantify some of those values,” SMSU President Kumara Jayasuriya said Wednesday.

On Tuesday, the Minnesota State system released an analysis of the economic contribution of its colleges and universities. The study, conducted by consulting firm Parker Philips, said the 26 colleges and seven universities in the system had a total impact of $8.4 billion on Minnesota’s economy in the 2021 fiscal year.

“The colleges and universities of Minnesota State are woven into the fabric of the 47 communities within which they are located,” Minnesota State Chancellor Devinder Malhotra said in a news release. “Our campuses provide access to an extraordinary education for all Minnesotans, no matter their background, and are often the social and cultural drivers in the communities we serve. We are the workforce engine for the state, and we are vital to the state’s economic, cultural, and civic development.”

The Minnesota State economic contribution study used financial data from system colleges and universities in fiscal year 2021, and a 10-year average of capital spending. Additional data was used to estimate spending by students and visitors, the study said.

Minnesota State’s overall economic impact included $4.7 billion in direct spending, and $3.7 billion in indirect and induced spending, the study said. The economic contribution of Minnesota State colleges and universities came from sources including operational and capital spending, employee pay and benefits, and student and visitor spending.

The operations of Minnesota State also supported or sustained a total of 62,125 jobs, the study said.

The study also looked at tax revenues generated by Minnesota State’s economic activity, including sales, property and income taxes. Minnesota State generates $649.2 million in state and local taxes, the study said.

In the 23-county southwest Minnesota region, Minnesota State colleges and universities had an economic impact of $1.4 billion, and supported 10,684 jobs, the study said.

Data in the analysis of Minnesota State was also broken down by individual institutions. SMSU had an economic contribution of more than $286.5 million, which included a direct impact of $163.7 million and an indirect impact of $122.8 million.

The study said the university supported 2,248 jobs. Of that total, 413 jobs were direct employees of SMSU. The study said SMSU generates over $23.4 million in state and local taxes.

“Our operations and the economic activity generated by our faculty, staff, and students touch virtually every corner of our regional economy including education, health care, hospitality, childcare services, business, and retail,” said Bill Mulso, vice president for government relations, communications and marketing at SMSU. The university’s impact also reached beyond the campus, through the careers and productivity of SMSU graduates, he said.

An estimated 19,080 SMSU alumni live and work in Minnesota, SMSU representatives said. The study estimated the value of the increase in productivity that SMSU graduates’ degrees brought throughout their careers. Each year, SMSU alumni generate $424.5 million in economic impact for Minnesota, and support and sustain 2,309 jobs.

“SMSU continues to contribute to the regional economy with every graduating class,” Mulso said. “Knowledge and productivity from higher education sustain that contribution for a graduate’s entire career. The impact is even greater when those alumni stay in the region to work and raise families.”

Jayasuriya said the information in the economic contribution study helped highlight the importance of higher education in the state. The Minnesota State system is currently seeking an additional $350 million in state funding. The additional funding would make possible important strategic investments to support students and economic development, Malhotra said earlier this month.

“As we look for further investments from the state it is important to stress the value we bring by not only providing an exceptional world class education for our students, but we are preparing the future workforce and helping to sustain and grow our statewide economy,” Jayasuriya said.


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