New report shows community colleges have huge impact on Alabama's economy

Greg Bailey, The Gadsden Times
·2 min read
Alabama Community College System Chancellor Jimmy Baker, shown during a 2020 visit to Gadsden, says a new report confirms that the system is a strong economic investment for the state.
Alabama Community College System Chancellor Jimmy Baker, shown during a 2020 visit to Gadsden, says a new report confirms that the system is a strong economic investment for the state.

Alabama’s community colleges have a massive impact on the state’s economy, according to data released Monday by the Alabama Community College System.

An independent report provided to the ACCS by Lightcast, a labor market analytics firm, found that Alabama’s community and technical colleges have a collective $6.6 billion annual impact on the state’s economy and support 1 of every 27 jobs here, according to the release.

That impact reflected 2.7% of Alabama’s gross state product in Fiscal Year 2021, which was the focus of the report, and supported 98,923 jobs in the state.

The ACCS received $869.8 million in funding from taxpayers in the focus year, according to the report, but community college students’ higher lifetime earnings and increased output to businesses provided a present value net benefit of $1.1 billion in added tax revenue for the state.

Lightcast used academic and financial reports from state community colleges and industry and employment data from the U.S. Bureau of Labor Statistics and Census Bureau in compiling the report.

“Our legacy centers on helping people develop the skills they need in order to build the framework of our state’s economy, and the data this report provides proves we are on a forward path of excellence in that pursuit,” said ACCS Chancellor Jimmy Baker.

“The results of the analysis demonstrate that the ACCS is a strong investment for all three major stakeholder groups — students, taxpayers and society,” he said. “Students receive a great return for their investments in an education from the ACCS. At the same time, taxpayers’ investment in the ACCS returns more to government budgets than it costs and creates a wide range of social benefits throughout Alabama.”

Other points from the report, which was released on the ACCS website:

  • Reduced demand for government-funded services in Alabama because of public sector savings from community colleges’ impact increases the annual benefit to taxpayers to $82.2 million.

  • The ACCS generates $7.40 in added tax revenue and public sector savings for every taxpayer dollar invested in the system, for as long as Fiscal Year 2021 students remain in Alabama’s workforce.

  • An Alabama community college graduate earns $7,900 more annually than someone with just a high school diploma.

  • Alabama community college students earn an average return on their educational investment of 22.1%.

  • Alabama community colleges’ operations spending added $535.8 million to the state’s economy.

  • Their construction spending provided $13.3 million in added income for Alabama.

  • The Alabama Technology Network, part of the ACCS, created $206.5 million in added income for the state through jobs it retained or created, and additional investments by businesses it supports.

  • Alabama’s total investment in the ACCS in Fiscal Year 2021 was $1.8 billion, but the anticipated economic growth through students’ working lives is $12.8 billion.

This article originally appeared on The Gadsden Times: Community colleges a boon for Alabama's economy