Page last updated at 00:19 GMT, Wednesday, 4 November 2009

Universities 'worth 59bn to UK'

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The study says universities make a substantial impact on the economy

Universities in the UK are worth £59bn for the economy, says a report into the economic impact of higher education.

The report, based on figures for 2007-8, highlights the growing role of universities as major employers and revenue earners.

Universities created, directly or indirectly, over 668,500 jobs - or 2.6% of the workforce, says the report.

The figures follow the launch of the government's blueprint to increase the economic importance of universities.

'Substantial industry'

The overall figure of a university sector worth £59bn represented an increase of 25% compared to four years before.

The study found the revenue earned by UK universities - for example by consultancy work, intellectual property income or hosting conferences - stood at £23.4bn, comparable to the printing and publishing industry.

It also suggested that by attracting foreign students the sector generated £2.3bn in 2007-08 in off-campus expenditure.

In terms of spending and supporting local economies, the university sector bought £19.5bn worth of goods and services produced in the UK.

The study, produced for Universities UK by researchers at Strathclyde University, concluded that higher education was a "substantial industry, with a substantial impact on the national economy".

"It is increasingly recognised in the UK that the sector has become a core part of the economic infrastructure of the country and its regions, generating employment and output, attracting export earnings and contributing to gross domestic product," says the report.

"The strength of the sector and its effectiveness in generating economic activity become all the more important in an economic recession when other sectors are contracting."

Employers

The report found universities directly provided 314,632 full-time jobs, representing more than 1.2% of the workforce in 2007.

And for every full-time job in universities themselves, more than one other full-time job was generated through "knock-on effects", the report said.

"Their importance as employers is well recognised at the regional level, since they are frequently among the largest employers in their regions," the report said.

"Universities are recognised for providing skilled and relatively high paid employment and attracting highly qualified people to an area (which in itself can contribute to increasing a region's capacity to absorb new ideas and innovations, making it more competitive).

"However, they are also important in providing employment in occupations across the entire skills spectrum."

Economic importance

Ursula Kelly of the University of Strathclyde, the report's co-author and director of the project, said: "This new report confirms the growing economic importance of higher education to the UK.

"The results highlight the increasing policy significance of higher education, both in terms of its contribution to GDP and its relative effectiveness in generating economic impact."

Business Secretary Lord Mandelson said: "Universities are critical to this country's economic performance contributing about £59bn.

"This importance will only grow over the next decade which is why we are publishing a blueprint for the future of higher education and the role it will play in securing the country's long-term prosperity."

Professor Steve Smith, president of Universities UK, said: "These figures show that the higher education sector is one of the UK's most valuable industries.

"Our universities are unquestionably an outstanding success story for the economy."



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