Public Universities and Community Colleges Boost the Illinois Economy by $16 Billion Every Year

A recent report by the Illinois Economic Policy Institute (ILEPI) and the Project for Middle Class Renewal at the University of Illinois at Urbana-Champaign (PMCR) assesses the positive economic impacts of public universities and colleges in Illinois and measures the costs of the two-year budget impasse. 

REPORT: High-Impact Higher Education: Understanding the Costs of the Recent Budget Impasse in Illinois

Investing in higher education is a smart economic development policy that boosts incomes, supports employment, and grows the economy. Illinois has world-class public universities and community colleges that serve as economic engines in local communities. The recent budget crisis in Illinois, however, had negative impacts on public universities and community colleges in the state.

Public universities and community colleges in Illinois provide significant contributions to the economy.

  • In 2016, there were more than 792,000 students enrolled at these institutions, including 620,000 students at community colleges and 172,000 undergraduate and graduate students at universities.
  • This public investment supports more than 123,900 total jobs annually for Illinois residents, including 79,600 direct jobs at university and college positions that annually pay $64,000 per worker.
    • 61,500 total jobs are supported in the Chicago area.
    • 31,000 total jobs are supported in the East Central Region, which comprises the University of Illinois at Urbana-Champaign.
    • 19,900 total jobs are supported in southern Illinois.
  • Public universities and community colleges boost the Illinois economy by $16.1 billion every year.
    • $9.3 billion in net economic activity is supported in the Chicago area, in part because a disproportionate share of college students comes from the region.
    • $3.4 billion in net economic activity is supported in the East Central Region.
    • $829 million in net economic activity is supported in the Bloomington and Peoria area.
  • Illinois’ twelve state universities alone contribute $12.7 billion to the state’s economy every year.
    • The University of Illinois at Urbana-Champaign generates 30,500 total jobs.
    • The University of Illinois at Chicago saves or creates 18,500 total jobs.
    • Illinois State University supports 13,400 total jobs.

The two-year budget impasse was a failure of leadership that had disproportionate and lasting consequences for public universities and community colleges.

  • The budget impasse caused students to question whether they should attend college in Illinois.
    • The cost of tuition and fees at public universities increased by over $900 per year (6.7 percent).
    • 42,800 fewer students were enrolled at public universities and colleges in the Chicago area.
    • 18,900 fewer students were enrolled at public universities and colleges across southern Illinois.
  • The impasse resulted in 7,500 higher education-related jobs lost in Illinois, including 4,900 direct jobs.
    • Chicago State University laid off 40 percent of its employees in 2016.
    • 78 percent of all job losses occurred in either the Chicago area or the East Central Region.
    • 2,300 professors and instructors (with annual salaries averaging $87,700) lost their jobs.
  • The fiscal strain on universities and colleges cost the Illinois economy nearly $1 billion each year.
    • Annual gross regional product declined by $487 million in the Chicago area.
    • Annual gross regional product declined by $289 million in the East Central Region.
    • Annual gross regional product declined by more than $78 million in the West Central Region.

Illinois must get back on the right track in the wake of the significant damage caused by the two-year budget impasse– with university reserves exhausted, programs cut, workers laid off, and credit ratings downgraded. Illinois can correct past mistakes by evolving into a national leader on making college affordable for its citizens or by expanding tuition grants to residents. College-educated workers accept better jobs, contribute more in taxes, and rely less on government assistance programs over the long run. Investments in higher education are thus good for both the Illinois economy and the state’s budget.

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