ASU’s growth drives local, state economy
“I can’t think of a single factor more important to economic vitality than the research university.”
– Dr. Robert Parry, president, Federal Reserve Bank of San Francisco
With more than 67,000 students and graduating 14,000 students annually, Arizona State University is one of the largest universities in the country. Foremost an educational institute, ASU also is a key driver of the local and state economy.
ASU graduates drive the Greater Phoenix economy and an expanding research base that yields innovative breakthroughs and plants the seeds for new enterprise. Overall, ASU accounts for a total of a whopping $3.2 billion dollars annually in economic impact, larger than Intel’s impact on Arizona.
If ASU were a private employer, it would be the third largest in the state. The total number of jobs supported by ASU directly, indirectly and secondarily tops 50,000 and approaches $2 billion in total wages. According to a 2005 report by the Center for Business Research, Arizona’s annual net income was more than $1.4 billion higher because of the education services provided by the university.
As the alumni base expands each year, so does the number.
Over the years, ASU has been critical to regional growth, as it has cultivated social networks of students, innovators and alumni who have contributed to the success of existing firms, enabled start-ups and attracted established firms to the area. The Valley’s substantial growth over the last 50 years has been closely linked to that of the university’s.
Although the easiest ways to describe ASU’s overall economic impact is as an employer, a purchaser of goods and services, and as a population magnet, the university’s research capacity has not only provided immediate economic impacts for the state, but has opened up new industries and created new jobs. If the first 50 years as university were about the raw number of graduates and employees, the next 50 will be about what those graduates and employees create both locally and globally. By spawning new technical fields and firms that can advance the commercialization of ideas, university research and development serve as the seed corn of long-lasting, knowledge-based economic growth.
“Research universities act as magnets for business that seek the talent they produce and benefits derived from the innovations and creative activity underway,” says Dennis Hoffman, economics professor, associate dean for research, and director of the Seidman Research Institute in the W. P. Carey School of Business. “University R&D acts as a catalyst for private activity. Trace the paths of the most successful entrepreneurial ventures and you are likely to find that research university connectivity played an important role.”
Similar to other American universities, ASU has evolved over the last decade into a large, diversified system that serves a wide array of research needs posed by a modern industrial society. Since 2001, Arizona State University has added more than 1 million square feet of research space, and the total number of research awards has increased by 50 percent, leading to more federal funding and a universitywide emphasis on innovation.
SkySong, the university’s hub for new innovative technologies and entrepreneurial opportunities, serves as an exemplar of the impact a university can have on the local and global economies. It is expected to create up to 4,000 relatively high-paying jobs, as well as revitalize its surrounding community. Staff analysis suggest that a redevelopment of nearby centers will help result in a net increase in direct city revenues over a 30 year period of $146 million. The very nature of SkySong encourages entrepreneurs to train in the region and stay in the region to participate and help create a local enterprise.
SkySong’s impact won’t be measured just by the businesses onsite. Julia Rosen, associate vice president of Innovation + Entrepreneurship, says SkySong “is a global business portal that will enhance ASU’s ability to translate its innovations to the marketplace, as well as expand its number of global technology and entrepreneurial partners.”
As a major research institution that is working to shape industry and advance technology, ASU’s economic growth trajectory hinges on its ability to generate and direct 21st century innovation. Its growth trajectory – a goal of $350 million in sponsored research by 2012 and an estimated 100,000 students by 2020 – provides the means to make this happen.