Auburn University Economic Impact Study – 2019 Executive Summary

Introduction

This summary report provides an overview of Auburn University’s economic contribution to the State of Alabama, including Auburn’s four institutional divisions and its alumni base across the state. The report reflects both direct and indirect impact through spending, creation of jobs, and enhancement of human capital. This report is based upon an economic impact study performed in Summer 2019 as part of the periodic review of Auburn’s economic impact since 1996.

Findings

The Auburn University system and its alumni contributed $5.6 billion to the economy of the State of Alabama in 2018-2019, a 4 percent increase since the previous study. This was realized through $2.2 billion in economic impact directly and indirectly attributable to the Auburn system. This impact represents an 8.5 to 1 return relative to the university’s annual state appropriation.  Auburn’s impact is estimated to be responsible for creating some 26,623 jobs in addition to its own direct employment. Additionally, the university’s high quality educational programs increase human capital in Alabama representing a value of more than $3.4 billion in earning power.

Auburn’s economic impact delivers a dramatic return on investment for Alabama taxpayers and other AU stakeholders. Auburn’s leadership in development and application of innovative technologies promotes the economy of the state as well as the economic and security interests of the nation as a whole. Auburn provides the primary academic support for a number of major state industries. Additionally, the Auburn and Montgomery campuses, Extension offices, research installations, outreach programs, museum, nature preserves, and faculty engagement extend the university’s significant presence across the state. This presence contributes greatly to community quality of life through support for civic infrastructure and business, and direct assistance to individuals.

Methodology

The committee drew upon 2018-2019 statistical and financial data compiled by a number of university offices including Business and Finance, Institutional Research, Student Financial Aid, Campus Planning, Alumni, Athletics, and the Auburn-Montgomery Chancellor’s Financial and Administrative offices. Financial and employment data quoted for Auburn University collectively reflect all four institutional divisions: Auburn University Main Campus, Auburn University at Montgomery, the Alabama Agricultural Experiment Station, and the Alabama Cooperative Extension System. Student spending information was drawn from surveys of expenditures compiled by both the Auburn and Auburn- Montgomery Student Financial Services offices. Visitor spending was estimated utilizing research provided by the Alabama Bureau of Tourism and Travel and the Auburn-Opelika Tourism Bureau. Estimates of earnings per discipline of alumni living in the state were based upon regional information reported from the Occupational Employment Statistics, Bureau of Labor Statistics, U.S. Dept. of Labor.

Economic multipliers used were generated by the U.S. Bureau of Economic Analysis Regional Input-Output Modeling System (RIMS II). The multiplier is state and county specific. In compiling the report, care has been taken to compensate for overstatement of the Auburn’s impact in the three key areas of study. This study does not include an estimate of the economic value of outreach programs and services delivered across the state. Nor does it estimate Auburn’s substantive impact beyond the state. Thus, this presentation reflects a conservative estimate of the Auburn University System’s economic contribution to Alabama.

Comparison to Previous Studies

This 2019 study was preceded by periodic studies performed by the Division of University Outreach on behalf of Auburn University since 1996. These studies have not been exact replications, but similar methodologies and sources of data were utilized in each. The results of these studies are presented in the chart below as a historical reference comparing the outcome of the current study to previously published statements of Auburn’s economic contributions.

AU Economic Contributions 1996 - 2019

  1996 2001 2007 2015 2017 2019
Economic Impact $1 billion $1.5 billion $1.7 billion $1.93 billion $2.1 billion $2.2 billion
Human Capital $1.3 billion $2.4 billion $3.15 billion $3.19 billion $3.3 billion $3.4 billion
Overall Contribution $2.3 billion $3.9 billion $4.85 billion $5.1 billion $5.4 billion $5.6 billion
Job Creation* 18,859 20,000 21,500 23,600 25,826 26,623

* Consistent with the presentation in previous years’ reports, these job creation figures do not include full time positions directly employed by the Auburn University system.

2019 Auburn University Economic Impact Study

This impact study was conducted by Keivan Deravi, Principal, Economic Research Services, and AUM Professor of Economics and Dean (retired), Montgomery, Alabama, and Ralph Foster, Assistant Vice President for University Outreach and Public Service, Division of University Outreach, Auburn University.

This Executive Summary was produced by the Division of University Outreach, Royrickers Cook, Vice President for University Outreach and Associate Provost, Auburn University, August 2019.

Contributors:
Matthew Campbell, Auburn Office of Institutional Research; Kate Cole, Auburn Alumni Association; Michelle Hancock, Auburn Controller’s Office, Business and Finance; David Mixson, Government and Economic Development Institute; Lindsey Sharpe and Rob McKinnell, Auburn Housing and Residence Life; Scott Parsons, Nichole Whitehead, Leon Higdon and Anthony Richey, AUM Office of Financial & Administrative Services; John Wild and Robyn Bridges, Auburn-Opelika Tourism Bureau. Additional data drawn from the web resources of the Auburn Office of Institutional Research, AUM Office of Institutional Effectiveness, Auburn Student Financial Services, Auburn Athletics Ticket Office, and the Auburn University Outreach Office of Public Service.

Printable Version of 2019 Economic Impact Study


Auburn University Outreach

Last Updated: October 16, 2019