TTU makes $151 million impact on local economy
Unquestionably, Tennessee Tech University plays a critical role in the regional and local economies of the Upper Cumberland communities.
Now we know just how great an impact — about $151.2 million a year. Thanks to a recent Economic Impact Assessment prepared by Whewon Cho, professor of economics and director of TTU's Center for Economic Education, the university's role within the region can now be quantified in terms of dollars and jobs.
In the last year alone, TTU provided the economic base for about 4,565 jobs regionally. In Putnam County, the university accounted for about 11 percent of the total personal income and 14 percent of the average (non-farm) wage and salary employment.
"The university is the flagship of our region," said Eldon Leslie, president and CEO of the Cookeville Area Putnam County Chamber of Commerce. "It would be impossible to fully calculate the entire economic impact of the university. It's most significant. You'll find it in virtually every aspect of life and economics here."
"TTU’s cumulative impact over the years is undeniably extensive, encompassing all aspects of living, including educational, cultural, social, political and economic," Cho said. "Realistically, that overall total impact can never truly be measured. Instead, we focused on only the economic significance of TTU to our community."
Even for the economics, only the short-term annual impact can be accurately calculated using both direct (the jobs and money the university directly creates and spends) and indirect measures.
The "indirect" impact describes the ripple effect the university has on the economy, including, for example, employment and purchases by local businesses for services and goods needed because the university is here. In other words, while TTU directly employs a certain number of people, those employees spend their incomes here, and as students and visitors spend money within the community also, other jobs and incomes are created via the ripple effect.
Cho looked at regional jobs, the growth of complementary businesses, and the university's positive long-term impact on enhanced productivity and vitality of the community as avenues of the university's impact. They all affect how attractive the region is to prospective employers and citizens.
"When recruiting, I can't overstate the importance of the university," Leslie said. "A good lifestyle attracts business and industry leaders who are considering coming into the area. Our great lifestyle here is directly attributable to TTU."
To get to his report findings, Cho focused on four main areas of economic indicators: employment, auxiliary earnings, construction and population.
• Employment: While the university lists 1,151 faculty and staff on its payroll of about $49.4 million in 2001-02, the ripple effect of those primary jobs and earnings are indirectly responsible for generating another 1,170 secondary employees and earnings of $66.5 million within the local economy. Altogether the university generated a total income of nearly $115.9 million and total employment of 2,321.
• Auxiliary earnings: Income and employment from TTU's auxiliary services generated (both directly and indirectly) about $3.1 million and 97 jobs from the two independent stores on campus, summer athletic camps, faculty consulting and student earnings from co-op assignments and internships.
Construction: University construction and major renovations created earnings of $2 million and 98 new jobs within the local economy last year.
• Population: Some 8,650 TTU students poured into Cookeville in the fall of 2001. About 46 percent of them work off-campus in local businesses, providing a much needed and flexible labor pool. Those students also spent $23.5 million regionally. The dollars they spent resulted in the employment of 1,568 local residents. In addition, visitors to the university — student families, research and teaching contacts, conference participants and others — spent nearly $6.7 million locally, providing the means for 481 local jobs.
But TTU's impact reaches far beyond the dollars and employment figures, according to Cho. "TTU has also been instrumental in expanding the market and base of the economy, providing quality labor, raising the quality of the existing labor force, enhancing productivity of businesses and workers through training and consulting, promoting quality schools, and attracting people and businesses to the region."
The era of Tennessee Tech's greatest growth coincides with the strides made by Putnam County, according to Cho's data. Between 1940 and 1999, Putnam County's per capita income increased almost 116 fold, while per capita incomes for Tennessee and the nation increased about 75 and 48 fold, respectively.
Between 1950 and 2000, Putnam County's population increased by almost 116 percent, while populations for Tennessee and the nation increased by 73 and 85 percent, respectively. The population more than doubled largely from positive net migration (not from the natural increase of more births than deaths).
About 87% of the teachers and administrators in Putnam County schools are either TTU-trained or married to a TTU professor or administrator. TTU's impact is also seen in the quality of schools and teachers, the relatively low turnover rate of teachers, and the ease of recruiting new teachers.
And from 1965 to 1997, total employment in Putnam County increased by almost 335 percent, and the number of businesses grew by a little more than 172 percent.
"It's evident that vibrant TTU is one of the critical conditions of keeping Putnam County continuously vibrant and strengthening its role as the leading hub of the Upper Cumberland," Cho said. "The university will further enhance not only Putnam's economy, but also that of the entire service region."