Study Reconfirms Economic Impact of UTHSC More Than $2.3 Billion

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A study designed to gauge the economic impact of the UTHSC on the economy of the state of Tennessee for FY2010 concluded that UTHSC’s total economic contribution to the state amounted to more than $2.3 billion.

A study designed to gauge the economic impact of the University of Tennessee Health Science Center (UTHSC) on the economy of the state of Tennessee for FY2010 concluded that UTHSC’s total economic contribution to the state amounted to more than $2.3 billion. Presented by the Methodist Le Bonheur Center for Healthcare Economics and the Sparks Bureau of Business and Economic Research at the University of Memphis, this study reconfirms findings of a 2001 study, and demonstrates that the economic impact of UTHSC’s statewide teaching, research and clinical practice activities continues to expand.

When it comes to employment figures, the study reports that UTHSC was directly and indirectly responsible for approximately 21,096 jobs across the state, which, in turn, generated a total of more than $804 million in earnings. The total output effect of $2.3 billion includes both direct expenditures by UTHSC and the subsequent downstream employment earnings.

Of the total 21,096 jobs created for Tennessee as a result of the operations of UTHSC, the largest share (73.8 percent, or approximately 15,576 jobs) are in the Memphis area. The 21,096 jobs created by UTHSC resulted in a total of $792.1 million of earnings, or about $38,140 per worker in FY2010. In comparison, Tennessee per capita personal income in 2010 was just $35,307.

In FY2010, a total of $970 million in direct spending attributable to UTHSC operations was injected into the Tennessee economy, the study states. Of this total, the largest amount, or $529 million, came from the expenditures generated by the clinical services delivered by the clinical faculty of UTHSC. Budgeted university spending ($388 million which included $126.6 million from state appropriations) represents the second-largest source of spending, followed by dollars spent by students and visitors ($39.4 million and $13.5 million, respectively). Considering that UTHSC received just $126.6 million of state appropriated dollars in FY2010, the $2.3 billion of total impact exceeds the state appropriation by a factor of more than 18 to 1.

Memphis, where the main UTHSC campus is located, contributed the most in total economic impact, representing about 73.8 percent ($1,714,290,651) of the total $2.3 billion impact. The other two major UTHSC locations, Knoxville and Chattanooga, represent 17.3 percent ($401,838,834) and 8.9 percent ($205,756,727), respectively, of the total.

Among its major academic units, the UTHSC College of Medicine was responsible for more job creation than the other colleges combined, contributing more than $2.07 billion (or 89.5 percent) of total economic contribution in FY2010. This was followed by the College of Pharmacy ($87.2 million, or 3.8 percent), the College of Dentistry ($73.9 million, or 3.2 percent), the College of Allied Health Sciences ($38.1 million, or 1.6 percent), the College of Nursing ($31.0 million, or 1.3 percent), and the College of Graduate Health Sciences ($13.3 million, or 0.6 percent).

In addition to its economic impacts, the UT Health Science Center has a substantial impact on the well-being of the citizens of Shelby County and the state of Tennessee through its role in educating and training health care manpower. Of all physicians practicing in Tennessee, for example, 4,604 (34.3 percent) were graduates of one of the four Tennessee colleges of medicine; of these, 66.7 percent (3,113) were graduates of the University of Tennessee College of Medicine. The other three medical schools in Tennessee (Vanderbilt University, Meharry Medical College, and East Tennessee State University) together account for just 11.1 percent.

To review the full study, visit: http://www.uthsc.edu/news/documents/Economic_Impact_of_UTHSC_in_FY2010.pdf.