Alabama’s community colleges add $6.6 billion to state economy

An economic report finds nearly 100,000 jobs and $1.1 billion in tax revenue

Northeast Alabama Community College’s Mathematics, Science and Engineering Technology Center.

The Alabama Community College System adds $6.6 billion to Alabama’s economy, according to an economic impact report conducted by Lightcast. The report states that the system directly impacts 98,923 jobs and that taxpayers see a net benefit of $1.1 billion in added tax revenue from students’ higher lifetime earnings and increased output to businesses.

“Students receive a great return for their investments in an education from the ACCS,” the report states. “At the same time, taxpayers’ investment in the ACCS returns more to government budgets than it costs and creates a wide range of social benefits throughout Alabama.”

The report also found that 95% of Alabama community college students live in the state, and that its alumni currently employed in Alabama’s workforce added $5.7 billion in income during the fiscal year 2021. Furthermore, 72% of associate degree recipients remained in Alabama following graduation. The average annual return for Alabama community college students is 22.1%, according to the report. The average Alabama community college graduate earns $7,900 more each year than a resident who does not obtain more than a high school diploma.

“Residents are receiving a strong return on investment when they invest in training at one of our colleges — whether through an adult education program, rapid skills training program, rigorous certification or academic transfer program that allows them to move toward completing a bachelor’s degree. And they’re using that training to make a difference right here in Alabama,” said Jimmy Baker, chancellor of the Alabama Community College System.

There are 24 community and technical colleges across Alabama employing 8,613 full-time and part-time faculty and staff with a payroll of $457 million. The system received $869.8 million in taxpayer funding in fiscal year 2020-21, but the system produced a tax revenue benefit of $1.1 billion and reduced demand for government-funded services in Alabama by $82.2 million, according to the report. So, for every dollar of public money invested in ACCS, taxpayers received $1.40 in return, over the course of students’ working lives. The average annual rate of return for taxpayers is 1.3%, according to the report.

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In addition, the jobs retained or created and additional investments by businesses supported by the Alabama Technology Network, an entity of ACCS, created $206.5 million in added income. ATN helped businesses retain or grow by nearly 2,000 jobs in fiscal year 2020-21.

ACCS also invests in construction projects each year to maintain facilities or create additional capacities. The net impact of the college’s construction spending in fiscal year 2020-21 was $13.3 million in added income for Alabama.

Lightcast, which conducted the survey, is a labor market analytics company focused on colleges and universities. For this report, it analyzed data using fiscal year 2020-21 academic and financial reports from Alabama’s community and technical colleges, as well as industry and employment data from the Bureau of Labor Statistics and Census Bureau.

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