NEWS FROM CALIFORNIA STATE UNIVERSITY

FOR IMMEDIATE RELEASE
October 26, 2004
CONTACT: Mike Stepanovich, 661/664-2456 or mstepanovich@csub.edu

California State University, Bakersfield had a nearly three-quarters-of-a-billion-dollar impact on Kern County in 2002-03, a study of the university’s economic impact shows.

The study, which was researched and prepared by Abbas Grammy, professor of applied economics at CSUB, reveals that:

• CSUB has $706 million impact on Kern County’s economy.
• CSUB contributes $268 million in direct and indirect spending to Kern County.
• CSUB helps increase the earning power of its graduates by $140 million.
• CSUB helps improve total factor productivity by $294 million a year.
• CSUB’s direct spending of $152 million creates 4,198 jobs in the local economy.

The study was released today at a news conference at CSUB.

“Few events have had a more profound impact on Bakersfield and Kern County than the founding of CSUB,” President Horace Mitchell said. “If you look at the university’s impact on the community simply in institutional terms, it contributes $60.4 million in wages and salaries, and another $9.5 million in the local purchase of goods and services.

“But the university’s impact is so much more than that,” he continued. “Thousands of alumni who live in Kern County enjoy increased earnings due to their CSUB degree. Retired faculty and staff add another $8.6 million to the area’s economy. Plus students spend some $51.4 million in the community.

“CSUB’s value to the community will grow as an increasingly educated workforce attracts more sophisticated companies with better paying jobs, broadening and deepening the local economy.”

Grammy said determining CSUB’s economic impact on Kern County requires a complex analysis. “Direct economic impact occurs in a variety of ways such as expenditures by university, faculty, staff, and students,” he said. “Indirect economic impact occurs when each dollar of direct spending creates additional dollars of expenditure in the community. In addition to these local expenditures, CSUB contributes to the local economy in a less obvious manner. As a regional university, CSUB supplies an educated and trained workforce to fill high-paying jobs, thus increasing the earning power of its graduates.

“Furthermore, the presence of the university increases the levels of educational attainment and factor productivity in the county. The reason for this intangible effect is that knowledge and expertise are more easily and quickly interchanged when educated workers interact with each other, hence increasing production of goods and services in the economy.”

Among highlights of the economic impact report:

• CSUB spent $15.5 million in capital expenditures in 2002-03, including remodeling of existing campus structures and construction of new buildings. Passage of propositions 47 and 55 mean another $25 million in capital expenditures over the coming few years.
• CSUB students, faculty, staff and alumni contributed 14,000 hours of community service to such organizations as the Bakersfield Homeless Center, Kern Adult Literacy Council, Boys and Girls Club, Ebony Counseling Center, Greater Bakersfield Chamber of Commerce, Hispanic Chamber of Commerce, and the American Cancer Society during 2002-03. Time value of that service is $6.7 million.
• Kern County enjoyed an $82.1 million income boost from alumni who continue to live and work in Kern County and who say they would not have earned a degree if not for CSUB.
• In terms of employment, the economic impact translates into nearly 4,200 jobs in Kern County, or 1.6 percent of all jobs in the county. This is a 71-percent increase from the last economic impact survey completed in 1997 that showed CSUB’s impact created 2,450 jobs.

A companion survey of CSUB alumni showed that 41 percent of responding alumni reported that without their CSUB education they would not have qualified for their current job; nearly a third (32 percent) reported that they most likely would not have earned their bachelor’s degree if CSUB did not exist; 36 percent said their CSUB education significantly improved their competitiveness in obtaining their current job; and 50 percent reported that their CSUB education led to a promotion and enhanced career paths with their current employer.

Significantly, 94 percent of CSUB alumni said their CSUB education was a good investment. They cited jobs and incomes that their education made possible, workplace-relevant skills that it developed, the economic opportunity the university creates for local residents, the wide range of cultural amenities it offers, and the civic values and community leadership a university education nurtures.

“CSUB’s greatest contribution to the quality of life in the community is its alumni,” Mitchell said. “Our graduates stay in the community, work in the community, spend their wages in the community, and participate in a range of community activities. As we see from this report, Kern County’s future depends on a broad base of educated men and women to meet the challenges of our rapidly changing region. CSUB is a key to this region’s economic well-being as we move deeper into the 21st century.”

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