A new study reveals that Virginia’s community colleges generated $11.6 billion annually in economic activity in fiscal year 2021-2022, an amount equal to 1.8 percent of Virginia’s total gross state product.
The study was conducted by Lightcast and titled “The Economic Value of the Virginia Community College System.” The study’s conclusion is that VCCS alumni and the businesses they work for saw $10.6 billion in added income. For perspective, Virginia would have to host the Super Bowl thirty times to achieve a similar economic boost. VCCS generates an additional $1 billion in income through operational spending and attracting new students into the state.
“This study highlights the important economic role Virginia’s community colleges play, not only in revenue-generation, but in job and wealth-creation as well,” Virginia’s Community Colleges Chancellor David Doré said. “It also serves to underscore the point that an investment in Virginia’s Community Colleges has consistently yielded a positive return for taxpayers and I am confident that it will continue to do so well into the future.”
Doré noted the study estimates that for every $1 invested in the community college system, students gain $5.70 in higher future earnings, and taxpayers see a net benefit of $2.70 in added tax revenue stemming from students’ higher lifetime earnings and increased output by businesses and public sector savings.
When compared to a person with a high school diploma or equivalent, the average community college graduate with an associate’s degree will see an increase in earnings of $12,200 annually. Separate from the Lightcast report, research by the VCCS reveals that students who complete FastForward short-term workforce training programs and go on to earn the resulting industry recognized credentials see average wage gains of $11,746 per year.
“This study makes it clear that the Virginia Community College System is an economic engine in its own right, “ State Board for Community Colleges Chair Peggy Layne said. “The myriad of positive contributions to state coffers and Virginians in particular cannot be understated.
In 2021-2022, the period which was the basis for the Lightcast report, state and local government funding for Virginia’s Community Colleges totaled $605.5 million.
The total investment made by VCCS students in 2021-22 amounted to a present value of $1.1 billion, equal to $433.8 million in out-of-pocket expenses (including future principal and interest on student loans) and $632.8 million in forgone time and money.
For every dollar invested in the VCCS, Virginians will receive a cumulative value of $8.80 in benefits. Altogether, the social benefits of VCCS equal a present value of $18.7 billion. Benefits include $12.6 billion in added student income in a 40-year working career, $4.7 billion in added business income, $1.1 billion in added income from college activities, as well as $319.7 million in savings related to reduced government spending for health, the justice system, and income assistance in Virginia, thanks to a more educated workforce.
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Rebecca Barnabi
