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University worth $1.5billion a year to Christchurch and Canterbury region
Published by the Communications and Development Department
11 December 2003
An economic impact report released today shows the University of Canterbury contributes more than $1.5billion directly and indirectly to the Canterbury regional economy every year.
The report, University of Canterbury: Economic Contribution to the Canterbury Region looks at what the University brings to the Canterbury region, both in economic activity and non-monetary terms.
Authored by the University’s Financial Services Manager, Jeff Long, in association with economist John Ballingall of the New Zealand Institute of Economic Research, the report sets out the direct impact of spending by University staff and students, and the indirect and induced effects on local businesses and employment levels.
Additionally, the report notes major benefits resulting from improved knowledge and skills, the range of facilities provided by the University, its research activities and the resulting outputs, and the wide range of cultural and creative activities.
Vice Chancellor Professor Roy Sharp said the report confirmed that the University of Canterbury was an enterprise that had a great positive impact on the wealth of the Canterbury region.
“But apart from the economic impact there is an enormous social and cultural impact on the city and its surroundings.
“The report reminds us of this, and that we have a responsibility
to ensure that the University continues to thrive. We are trying to
achieve this through our new management structure, which we are introducing
next month, and careful adherence to our financial recovery plan.”
The main question addressed by the report is: What does Canterbury University bring to the region, both in economic activity and non-monetary terms? It also measures the net benefits that the Canterbury region would miss out on if the University was not present.
The University offers undergraduate and postgraduate courses in nearly 50 disciplines ranging from Accountancy to Zoology. It has more than 12,400 students, with nearly 1,900 working towards postgraduate qualifications. It has a number of specialist research centres, operates six major field stations, and provides a wide range of sporting, artistic, social and cultural amenities for staff and students, and also for the community at large.
In terms of direct spend, the University’s forecast expenditure in 2003 is $170.4 million. This is not taking depreciation into account, but instead adding actual capital expenditure. Further details will be available in the University annual report for 2003.
Based on a 2001 survey carried out by the New Zealand Universities Students’ Association of student income and expenditure, the total expenditure in 2003 by students attending Canterbury University (including those attending the Centre for Continuing Education) was $332 million. Of this amount, it is estimated that the region would miss out on $264 million if the University were not in existence. This takes into account students who move to the region specifically to attend Canterbury University, and also the loss of expenditure by students who would move out of the region if the University was not present.
In total, the net direct expenditure by the University of Canterbury and the students attending the University, is more than $434 million a year.
This initial injection of expenditure into the Canterbury region has significant ‘flow-on’ effects. For example, spending by the University, its staff and students on goods and services adds to the turnover of local businesses, and in turn will affect the incomes of owners and employees, and employment levels. These owners and employees will themselves use a proportion of their additional income to buy more goods and services in the Canterbury region, thus boosting the incomes of other business owners and employees. By using expenditure and employment ‘multipliers’, the magnitude of these flow-on effects can be measured.
Using information developed by Statistics New Zealand and the NZ Institute of Economic Research, the multiplier effects of expenditure by the University and its students can be estimated.
The flow-on effects of the University’s expenditure and that of its students are summarised below:
In terms of the employment multiplier effect, it is calculated that for every additional $106,798 that the University spends, it will employ one more full-time equivalent member of staff. As a result of the flow-on effects of this additional expenditure and employment by the University, another 1.25 full-time equivalent positions are created elsewhere in the regional economy. In other words, every time an additional 4 full time jobs are created at the University, another five jobs are created in the Canterbury region as a result.
While there are other educational organisations providing education opportunities at the tertiary level, the range offered at Canterbury is by far the most extensive. The total economic impact of Canterbury University on the Canterbury region is $1.53 billion worth of gross output per annum.
In addition, there are major benefits to the community as a whole
resulting from:
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