College generates $117 million annual economic impact

Pellissippi State pumped an average of $117 million each year into the local economy over the past five years, a new study shows.

The 19th annual analysis of the economic impact of the College on the Knox and Blount county area revealed that the value of business volume, jobs and individual income amounted to about $586 million in the 2001-2006 period, or $117 million each year.

Fred H. Martin, an educational consultant who completed the study, says local business volume—the total amount generated locally from the College’s direct and indirect expenditure—was more than $290 million for the five-year period. Of that total, more than $224 million came from non-local revenues, such as state appropriations, state and federal contracts and grants, and federal and state student financial aid revenues.

Although Pellissippi State had an average of only 426 full-time-equivalent employees per year during the period, the total annual employment created by the College’s expenditures was estimated at 20,816 jobs for the five years. Of those, more than 15,855 were created by external or new funds.

Using the more conservative of two different calculations, Martin has estimated that the impact of the College’s expenditures on personal income in the area amounted to about $296 million during 2001-2006, of which $233 million came from external or new funds.

Of the College’s $586 million total economic impact, about $458 million ($92 million each year) could be attributed to the infusion of “new” non-local revenues.

“This impact would likely not have occurred without the presence of Pellissippi State in the area,” said Martin.

The economic impact study notes that each dollar of local revenue coming into the College generated a “return on investment” of about $3.38 in local business volume. The individual income generated ranged from $3.44 to $3.78, for a total return on investment, or ROI, of at least $6.82.

The study did not measure such intangible economic effects as corporate relocation and expansion decisions based on the presence of the College in the area, or wages paid to and taxes paid by Pellissippi State graduates. The College directly boosts the local economy through such things as employee salaries and benefits, construction and maintenance work and local purchases of equipment and supplies.

“The results of this economic impact study clearly demonstrate that Pellissippi State continues to be a major contributor to the economic base of Knox and Blount counties,” Martin said. “This economic impact is expressed in terms of jobs created, business volume generated and personal income earned.”

"Inside Pellissippi" is a bi-monthly electronic publication produced by the Community Relations Office for the faculty and staff of Pellissippi State Technical Community College, 10915 Hardin Valley Road, P.O. Box 22990, Knoxville, Tennessee 37933-0990. All suggestions and comments should be sent to Julia Wood (jwood@pstcc.edu).

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