Lexington, Ky. — A new study reveals that the 18 independent colleges and universities that make up the Association of Independent Kentucky Colleges and Universities (AIKCU) contribute nearly a billion dollars to Kentucky’s economy each year.
The report emphasizes the substantial public benefits a healthy independent higher education sector provides to the commonwealth. In addition to the $850 million in an annual economic activity they generate, these private, nonprofit colleges and universities support more than 9,000 Kentucky jobs and their employees generate $38 million in tax revenues for the commonwealth.
“Our independent colleges and universities span the commonwealth geographically, with most in rural communities where they serve as one of the top employers,” said Dr. OJ Oleka, president of AIKCU. “Our members employ more Kentuckians than the bourbon industry, making independent higher education one of the greatest job creators in Kentucky, particularly for our rural communities and families.”
Key findings from The Economic and Fiscal Benefits of Independent Higher Education to Kentucky include:
- AIKCU colleges and universities are responsible for more than $850 million in economic activity in Kentucky each year. That’s close to $10 billion dollars in economic activity over a decade, without including capital expenditures or community investments.
- AIKCU colleges and universities support more than 9,000 total jobs in Kentucky.
- AIKCU members directly employ 7,000 Kentuckians at an average wage of about $41,000.
- The earnings of those 7,000 Kentucky employees support an additional 2,300 Kentucky jobs, producing additional earnings of $110 million and an average wage of $47,000.
- Altogether, Kentucky’s independent colleges and universities generate nearly $300 million in earnings for Kentucky workers.
- AIKCU employees generate $38 million in Kentucky tax revenues each year through state income, sales, property, vehicle, gas, and other taxes.
The economic and fiscal footprint study was produced by AIKCU in consultation with an outside economist. The report utilizes the fiscal year 2018 data and employs a very conservative methodology.
That narrow methodology includes only economic activity, jobs, and tax revenue occurring inside Kentucky generated by the institutions’ recurring annual operations and employee spending. Notably, it excludes the higher wages and taxes paid by AIKCU graduates, capital construction projects, student and visitor spending, the value of community service and cultural activities, and other factors that are sometimes included in broader economic impact studies.
“The $38 million in state tax revenues generated by AIKCU employees more than offsets the investment the commonwealth makes in our AIKCU students through the Lottery-funded Kentucky Tuition Grant,” said Dr. Oleka. “And that’s without measuring the increased long-term earnings, taxes paid, and human capital gains that accumulate to our graduates. I’d say that’s a pretty good return on the state’s investment.”
The Association of Independent Kentucky Colleges and Universities (AIKCU) represents Kentucky’s 18 private nonprofit, independent 4-year colleges and universities. Together, AIKCU members enrolled more than 56,000 students and awarded over 13,000 degrees and credentials in the most recent academic year. AIKCU member colleges and universities include Alice Lloyd College, Asbury University, Bellarmine University, Berea College, Brescia University, Campbellsville University, Centre College, Georgetown College, Kentucky Christian University, Kentucky Wesleyan College, Lindsey Wilson College, Midway University, Spalding University, Thomas More University, Transylvania University, Union College, University of Pikeville, and University of the Cumberlands.