An investment in a degree from The University of North Carolina at Pembroke yields approximately $577,423 in additional income to graduates over a lifetime.
The estimate is from research by UNCP economics professor Dr. Mohammad Ashraf in a 53-page study that was released this summer. It is the most comprehensive look ever at the economic impact of UNCP - on its students, the surrounding community and the state.
The study, entitled “The Economic and Social Impacts of The University of North Carolina at Pembroke,” finds that the “opportunity costs” of a four-year UNCP education is $77,870 (including more than $57,000 in wages lost from not entering the job market after high school). The typical graduate pays for his UNCP degree in 4.5 years, the study finds.
“The purpose of any public university is to provide benefits to society,” Dr. Ashraf said. “One of the purposes of this study was to determine whether the taxpayers’ investment in UNCP is worthwhile.”
The study finds that for every dollar spent by taxpayers for higher education, UNCP returned $1.80 worth of benefits. From UNCP’s budget of $35,425,531 in 2005-06, taxpayers gained about $62,380,490.
Each job at UNCP creates 1.5 jobs in the region (Robeson, Scotland and Cumberland counties). Using the study’s equation, 1,083 jobs in the region owe their existance to UNCP.
“I focused on two main sources of economic impact: the expenditure incurred by the University and the region through salaries, purchases and students trained by the University, who in turn participate in the growth and development of the region,” Dr. Ashraf said.
The study was funded by a faculty grant (?) from the Office for Academic Affairs. Provost and Vice Chancellor for Academic Affairs Dr. Charles Harrington said it is a useful report.
“Dr. Ashraf’s careful work will be of vital importance to the University as we continue to measure and analyze our impact on the regional economy,” Dr. Harrington said. “It’s very clear from the data that UNC Pembroke has a major economic and social impact on our service area.
“Equally persuasive is economic and social impact that our students have,” he said. “The taxpayers of North Carolina can rest assured that the dollars invested in our University have paid back enormous dividends.”
Higher education “also has a huge social impact,” Dr. Ashraf said.
Because of UNCP, there were 26 fewer incarcerations in North Carolina, saving the taxpayers almost $1.3 million per year. And, there were 281 fewer smokers due to UNCP’s influence, saving taxpayers nearly $1 million per year in health care costs.
“The findings of this study indicate that UNCP is a great investment for both state taxpayers and students,” Dr. Ashraff said. “The benefit-cost ratio for state taxpayers is 1.761, and the benefit-cost ratio for a typical UNCP graduate is 7.42.”
Dr. Ashraf said his findings represent “extremely conservative estimates.” Only “solid data” was used, and there was “very little room allowed for overstatment of the impact.”
“Using 4.06 percent as the discount rate to calculate the present discounted value, each UNCP graduate will generate about $40,420 additional dollars in state revenue,” he said.
Growth of the University since 1999 when Dr. Ashraf arrived at UNCP has been phenomenal. Enrollment has nearly doubled (to 5,632 in fall 2005 from 2,966 in 1999), and total employment is up more than 50 percent (to 671 in fall 2005 from 444 in 1999).
“Expanding this University would be worthwhile to this region,” he said. “Just look at how the Town of Pembroke has grown.”
The study, which Dr. Ashraf describes as simple macroeconomic - the growth and development of economic units - is loaded with a great deal of useful information. Dr. Ashfraf, who is in his 8th year at UNCP’s School of Business, plans to publish the study in the future.
Research was assisted by UNCP’s offices for Institutional Research, Human Resources, Alumni Relations and Financial Planning and Budgeting.
For questions, Dr. Ashraf may be contacted at 910.521.6464 or by email at email@example.com.