University Relations and Marketing

Contacts:
Patrick Barkey, director of the Bureau of Business and Economic Research at the University of Montana, pat.barkey@business.umt.edu, 406-243-2723
Doug Steele, MSU vice president of external relations and director of Extension, 406-994-3293, dsteele@montana.edu

January 5, 2011

Study: MSU contributes more than 13,500 jobs and $1 billion to state’s economy

Bozeman -- Montana would have 13,500 fewer jobs and more than $1 billion less in personal income if the Montana State University system of four campuses and the Montana Agricultural Experiment Station did not exist, according to a recently released economic impact report.

The report also highlights the value of a college degree: Montana citizens with a bachelor’s degree will earn $569,000 to $814,000 more over their lifetime than those holding only a high school diploma.

The report was commissioned by MSU to measure its impact on Montana’s economy. It is the most complete study ever done on the university, covering its campuses in Bozeman, Billings, Havre, and Great Falls as well as the Montana Agricultural Experiment Station, which conducts agricultural research in centers across the state.

The report’s research and analysis was done by Patrick Barkey, director of the Bureau of Business and Economic Research, a research center within the University of Montana’s School of Business Administration. Barkey did a similar economic analysis for the Missoula campus of UM in March, however, the UM and MSU analyses used slightly different models and their results cannot be compared.

Despite the differences, the results clearly show that the operation of the Montana university system is a complementary force for economic advancement in the state of Montana, the MSU report states.

One of the key findings of the report is the value a college degree has in boosting a person’s lifetime earnings.

A 25-year-old Montana man with a four-year college degree will enjoy, on average, earnings over his working life that are worth $814,000 more than he would realize with only a high school degree. For a woman, the extra earnings amount to $569,000 on average.

“Evidence from this study suggests that college is critical for the future economic status of individuals,” the report states.

The MSU system has a combined enrollment of nearly 22,000 students being served at four campuses and through Internet-delivered courses. 

The results of the analysis measured the university’s contribution related to five key areas for which data were available: university operations, research expenditures, increased earnings of graduates, as well as spending of out-of-state visitors and nonresident student off-campus spending.

The premise of the study was to compare the actual economy with a hypothetical economy in which the university does not exist. 

“The university system provides a powerful boost to the state economy,” Barkey said.

For the state as a whole, the presence of the MSU system increases annual wages across Montana an average of $1,087. Additionally, the MSU system generates $253 million in state tax revenue, which means the state receives $2.60 in tax revenues for every $1.00 of tax support. And finally, Montana is the beneficiary of $349 million annually in investment spending thanks to the MSU system.

“Bottom line, the university system produces a far greater economic benefit for Montana than the investment put in by the state,” Barkey said. 

MSU Bozeman

  • Jobs: More than 9,000 jobs are available due to the presence of the Bozeman campus.
  • Income: Almost three-quarter billion dollars in earnings are attributable to MSU Bozeman.
  • Tax Revenue: The return on investment in the Bozeman campus is threefold. The 2009 state appropriation of $50.5 million resulted in $168.6 million in state tax revenues.
  • Compensation: Annual wages are $690 higher across the state because of the presence of MSU Bozeman.
  • Investment Spending: An increase of $234.6 million in investment spending in the Montana economy occurs every year due to the operation of the Bozeman campus.

MSU Billings

  • Jobs: The Billings campus creates nearly 1,700 jobs for state residents.
  • Income: Almost $175 million in personal income results from MSU-Billings.
  • Tax Revenue: In 2009, MSU Billings was responsible for $36.5 million in state tax revenues from the $20 million state investment. This means the state received $1.80 in tax revenues for every $1.00 of tax support.
  • Compensation: Annual wages are $235 higher across the state because of the pres­ence of MSU Billings.
  • Investment Spending: An increase of $36.5 million in investment spending in the Montana economy occurs every year due to the operation of the Billings campus.

MSU Northern

  • Jobs: The Havre campus contributes 800 jobs in a region of Montana where job availability is crucial.
  • Income: These jobs mean an additional $82 million in personal income.
  • Tax Revenue: MSU-Northern produces a two to one return on investment of state dollars. The $9 million state investment resulted in $18 million in state tax revenues in 2009.
  • Compensation: Annual wages are $94 higher across the state because of the presence of MSU Northern.
  • Investment Spending: An increase of $14.7 million in investment spending in the Montana economy occurs every year due to the operation of the Northern campus.

MSU Great Falls

  • Jobs: More than 400 jobs are added to the state economy through the presence of the Great Falls campus.
  • Income: The resulting personal income from the 400 jobs is $37 million.
  • Tax Revenue: In 2009, Great Falls increased the initial investment of $6 million to $7.9 million in state tax revenues. This means the state received $1.30 in tax revenues for every $1.00 of tax support.
  • Compensation: Annual wages are $41 higher across the state because of the presence of MSU-Great Falls.
  • Investment Spending: An increase of $7.3 million in investment spending in the Montana economy occurs every year due to the operation of the Great Falls campus.

Montana Agricultural Experiment Station (MAES)

  • Jobs: MAES contributes 1,600 jobs that support the agricultural industry in Montana.Income: Through MAES more than $100 million in personal income is dispersed.
  • Tax Revenue: The state’s investment of $12.7 million was increased to $22 million in tax revenues in 2009. This means the state received $1.70 in tax revenues for every $1.00 of tax support.
  • Compensation: Annual wages are $27 higher across the state because of the presence of MAES.
  • Investment Spending: An increase of $56.2 million in investment spending in the Montana economy occurs every year due to the operation of MAES.

MSU Extension has a presence in all of Montana’s counties and its unique structure made it unsuitable for analysis under the categories of university operations, research expenditures, increased earnings of graduates, and nonresident visitor and student off-campus spending. As such, the economic impact of MSU Extension is not included, however, it employs 188 full-time positions and has $15.5 million in annual spending – mostly in salaries and benefits. Federally appropriated funds make up 32 percent, or $5.5 million of MSU Extension’s annual spending.

The complete MSU Economic Impact Report can be found on-line (PDF).


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