New Study shows the California State University’s powerful impact on California

Contact: Colleen Bentley-Adler, (562) 951-4800, caba@calstate.edu

(November 16, 2004) – A sweeping, comprehensive study of the impact of the California State University dramatically shows how the university system and its 23 campuses directly or indirectly affect the economic, social, intellectual and cultural life of all of California.

The CSU Board of Trustees was presented today with the key findings of the recently completed study—Working for California: The Impact of the California State University. The study, conducted by ICF Consulting, quantifies the impact of the 23 campuses on the state and their regions. The full report and brief overview is available online at www.calstate.edu.

“Californians undervalue the vital importance of the CSU system and its campuses, so this report is a key way to identify the critical role of the California State University. The CSU directly or indirectly impacts everyone in the state, and we add value to everyone’s lives,” said CSU Chancellor Charles B. Reed. “ If it weren’t for the CSU, California simply would not enjoy the level of success that it has today.”

Looking first at the pure economic effect of spending: because of the multiplier effect, for every $1 the state invests in the California State University system ($3.09 billion in 2002/03), CSU-related expenditures generate $4.41 in spending.

As a result, the immediate impact of CSU-related expenditures creates $13.6 billion annually in economic activity and supports 207,000 California jobs. In addition, some $760 million in taxes is generated for the state’s coffers.

But the CSU does not just spend money: it spends money to educate, thus increasing the economic power of the state and of its citizens by building up the knowledge base. CSU graduates obtain better jobs because of their degrees, while the state benefits because the deep pool of trained and knowledgeable citizens produced by the CSU allows more high-end jobs to be created and performed in the state.

“CSU’s well-educated graduates help to attract, retain, and develop the companies that are leading California’s economy into the future,” said Chancellor Reed. “An investment in the CSU is an investment in California.”

It is estimated that the 1.7 million CSU alumni living and working in California earn $89 billion in income, $25 billion of which is directly attributable to their degrees. If the enhanced earnings of its graduates are factored in, the total effect of the state’s investment in the CSU climbs steeply, so that the annual spending impact rises from $4.41 to $17 for each $1 invested.

The combined total annual economic impact of CSU expenditures, the enhanced earnings of its graduates, and the ripple effect of both generates a $53 billion spending impact on the state, supports 527,000 jobs, and creates $3.11 billion in tax revenue for state and local governments—more than is provided to the CSU in direct annual state support. The CSU in effect pays for itself.

The report also breaks this impact into its regions, which shows how the various campuses clustered in a region generate revenue, jobs and graduates for area communities.

The long-term effect of the CSU on California’s economic health, however, is not limited to the increased earnings of its graduates. By increasing its skilled workforce, CSU programs directly serve the knowledge-based industries that drive California’s economy.

For example, the CSU, which confers half of all the bachelor’s degrees and a third of the master’s degree granted in the state, is the key educator in a number of fields. It confers

  • 65 percent of California’s business baccalaureate degrees
  • 52 percent of its agricultural business and agricultural engineering baccalaureate degrees
  • 52 percent of its communications baccalaureate degrees
  • 45 percent of its computer and electronic engineering baccalaureate degrees.

The CSU also trains the professionals needed to keep the state running. It provides bachelor’s degrees to teachers and education-related staff (87 percent), criminal justice workers (89 percent), social workers (87 percent), and public administrators (82 percent).

Further, the CSU is opening doors and reaching out to new populations, touching many who are the first in their families to seek a university education. Reflecting California’s increasing diverse population, the CSU confers 58 percent of the bachelor's degrees earned by Latinos, 52 percent of these degrees earned by African Americans, and 39 percent of these degrees earned by Asian/Pacific Islanders.

The economic opportunity the CSU provides is key to the health of a demographically changing state. The California State University is the preeminent representative of that changing population: the CSU is the country’s most diverse university system, with 53 percent minority students, twice the national average for four-year universities.

An often-overlooked aspect of the CSU’s economic impact can be found in the research and innovation generated by its 23 campuses and supported by federal, state, and private funding. Its contributions include

  • Applied research—CSU faculty and their students are tackling a series of practical challenges that face California, from care for the aging to irrigation technology.
  • Technology Centers—Research organizations have been established across the CSU to focus on issues of strategic importance to California, with campuses focusing on regional needs, such as aerospace or environmental technology.
  • Entrepreneurship—CSU faculty and facilities are providing services and guidance to help the risk-taking entrepreneurs who launch new products in the state, and are working with small businesses to better their managerial approaches.
  • Technology Parks—Several campuses have created partnerships with the private sector to develop research and technology parks that help link campuses and industry, providing faculty expertise and student interns and research assistance.

Beyond its high economic impact, the CSU also has a powerful effect on the quality of life in California. Of course, the CSU directly affects the social, cultural, and intellectual life of its graduates. But the CSU universities are core partners of their communities, enriching the social and cultural life of the surrounding regions and providing services unavailable otherwise.

Sporting events, public lecture series and art exhibitions, library and museum resources, music, film, and theatre productions—all play a unique role in the enriched life of the CSU communities. Each year, 3.1 million visitors and tourists flock to CSU campuses to attend university-based events. In addition, the campuses provide highly rated and often unique radio and local cable television programs throughout the year to the listening and viewing public.

In addition, because of CSU’s emphasis on community service and community service learning, nearly half of CSU’s 400,000 students are at work locally, bringing tutoring, civic outreach, and other service contributions to their neighbors. CSU student volunteers contribute 33 million hours each year, both as part of their academic experience and as a university-encouraged service.

The California State University is thus, in a wide range of fields, a key economic, social, and cultural mover in the state. As the facts and examples carefully laid out in the Impact Report show, the CSU’s motto—“The CSU is Working for California”—means exactly what it says.


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Last Updated: November 16, 2004

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