The College Portrayed As A Regional Economic Engine

econ impact

So, just how important is St. Clair College to southwestern Ontario?

That is the question that the school has been seeking to answer for the past couple of years.

In a report presented to the school's Board of Governors (BofG) during its November 24th meeting, from President Patti France and Vice-President of Finance Marc Jones, the quest to answer that question was described:

The college engaged EMSI (an economic modelling and analysis firm dealing with postsecondary education) in 2018 to perform an economic value study.

The study assessed the impact of the college on the regional economy and the benefit generated by the college for its main stakeholders: students, taxpayers, and society.

The study reports on two main measures: economic impact and return on investment.

The results of the 2018 study showed that the college has a significant positive impact on the business community in the regional economy; and generates benefits in return for the investments made by students, taxpayers, and society.

The college had EMSI refresh the economic value study in 2019. This was done in response to the initial parameters outlined in the Strategic Management Agreement 3 (the operational and funding agreement between the college and provincial government), as one of the ten metrics that would be included in the (province's new) performance-/outcome-based funding envelope. As the SMA3 process progressed, the college determined that using the economic value study as a metric could present challenges when trying to minimize the risk of reduced performance-/outcome-based funding. This is due to the lack of economic value data beyond two years, external data changes (for instance, the census) that make year-over-year comparisons difficult, and leads to a problematic allowable performance target set by the Ministry (of Colleges and Universities). That being said, the EMSI report provided supporting documentation for our Economic Impact of International Students metric.

The 2019 economic value study was presented to the Board of Governors on January 25, 2020. It showed strong improvement from the 2018 study on the economic impact and return on investment metrics.

The college indicated it was committed to continuing with the study on an annual basis for the next five years (2024-25). An additional benefit of the study is that it allows the college to utilize the data when collaborating with community partners, as it assesses the college's impact on the regional economy and the benefits generated by our main stakeholder groups.

In following through with its five-year commitment, the college had EMSI refresh the economic value study for 2020.

Here is the "nut-shelled" fact-sheet conclusion contained in EMSI's 2020 report:

St. Clair College of Applied Arts and Technology (SCC) creates a significant positive impact on the business community and generates a return on investment to its major stakeholder groups-students, taxpayers, and society. Using a two-pronged approach that involves an economic impact analysis and an investment analysis, this study calculates the benefits received by each of these groups. Results of the analysis reflect fiscal year (FY) 2019-20.

ECONOMIC IMPACT ANALYSIS

In FY 2019-20, SCC added $811.8 million in income to the Windsor-Essex and Chatham-Kent economy, a value approximately equal to 2.7 percent of the region's total gross regional product (GRP). Expressed in terms of jobs, SCC's impact supported 9,381 regional jobs. For perspective, the activities of SCC and its students support one out of every 33 jobs in Windsor-Essex and Chatham-Kent.

econ impact report

OPERATIONS SPENDING IMPACT

• SCC employed 873 full-time equivalent employees in FY 2019-20. Payroll amounted to $94.8 million, much of which was spent in the region for groceries, mortgage and rent payments, dining out, and other household expenses. The college spent another $92.1 million on day-to-day expenses related to facilities, supplies, and professional services.

• The net impact of the college's operations spending added $133.1 million in income to the regional economy.

CONSTRUCTION SPENDING IMPACT

• SCC spends money on construction each year to maintain its facilities, create additional capacities, and meet its growing educational demands. While the amount varies from year to year, this spending generates a short-term infusion of spending and jobs in the regional economy.

• The net impact of SCC's construction spending in FY 2019-20 was $5.2 million in added income for Windsor-Essex and Chatham-Kent.

STUDENT SPENDING IMPACT

• Around 46 percent of credit students attending SCC originated from either outside the region or outside Canada in FY 2019-20, and some of these students relocated to Windsor-Essex and Chatham-Kent to attend SCC. In addition, a number of local students would have left the region if not for SCC.

• These students spent money on groceries, mortgage and rent payments, and so on at regional businesses. This spending in FY 2019-20 added $25.6 million in income to the Windsor-Essex and Chatham-Kent economy. Of this impact, $18.5 million is attributable to international students who relocated to Windsor-Essex and Chatham-Kent to attend SCC.

ALUMNI IMPACT

• Over the years, students have studied at SCC and entered or re-entered the workforce with newly-acquired knowledge and skills. Today, thousands of these former students are employed in Windsor-Essex and Chatham-Kent.

• The net impact of SCC's former students currently employed in the regional workforce amounted to $647.9 million in added income in FY 2019-20. Of this impact, $201.4 million is attributable to former international students working in Windsor-Essex and Chatham-Kent.

econ impact report

INVESTMENT ANALYSIS

STUDENT PERSPECTIVE

• SCC's FY 2019-20 students paid a present value of $139.2 million to cover the cost of tuition, fees, and supplies. They also forwent (declined potential eligibility for) $182.5 million in money that they would have earned had they been working instead of attending college.

• In return for their investment, students will receive $680.4 million in increased earnings over their working lives. This translates to a return of $2.10 in higher future earnings for every dollar students invest in their education. Students' average annual rate of return is 14.4 percent. (This refers to the increased lifetime wage-earnings of the holder of a college education, versus those with just a high school education.)

TAXPAYER PERSPECTIVE

• Provincial taxpayers provided SCC with $55.9 million of funding in FY 2019-20. In return, they will benefit from added tax revenue, stemming from students' higher lifetime earnings and increased business output, amounting to $413.7 million. A reduced demand for government-funded services in Ontario will add another $10.7 million in benefits to taxpayers.

• For every dollar of public money invested in SCC, taxpayers will receive $7.60 in return, over the course of students' working lives. The average annual rate of return for taxpayers is 80.3 percent.

SOCIAL PERSPECTIVE

• In FY 2019-20, society in Ontario invested $381 million to support SCC, including all student and all college costs. In turn, the Ontario economy will grow by $2.7 billion, over the course of students' working lives. Society will also benefit from $26.9 million in present value social savings related to reduced crime, reduced demand for income assistance, and increased health and well-being across the province.

• For every dollar invested in SCC in FY 2019-20, people in Ontario will receive $7.20 in return, for as long as SCC's FY 2019-20 students remain active in the provincial workforce.

MORE STORIES FROM THE NOVEMBER MEETING OF THE COLLEGE'S BOARD OF GOVERNORS

The Mid-Year Budget Adjustment: http://stclair-src.org/news/need-know-news/college-still-track-year-end-surplus

The Acquisition of New Downtown Classroom Space: http://stclair-src.org/news/need-know-news/college-acquires-additional-downtown-classroom-space

The Annual Risk Management Report: http://stclair-src.org/news/need-know-news/pandemic-or-not-running-college-risky-business

A Full Description of Academic Transfer Opportunities: http://stclair-src.org/news/need-know-news/where-do-you-go-here-lots-choices