The Contribution of the University of Hawai‘i at Manoa to Hawai‘i’s Economy in 2012

The University of Hawai‘i at Mānoa (UHM) generates economic activity through its purchases from local businesses, its payment to its employees, and spending by students and visitors. This report estimates UHM’s total economic activity in the state of Hawai‘i in fiscal year 2012. Following a standard approach, we define economic impact to be the direct, indirect, and induced economic activities generated by the university’s spending in the state economy.

Although one can think of the UHM as if it were one of many businesses or industries in Hawai‘i, an important difference between UHM and most private businesses is that UHM gets a substantial part of its funding from taxpayers. In FY2012, UHM and the supporting RCUH (Research Corporation of the University of Hawai‘i) spent a total of $878 million in support of its education mission; the State General Fund paid $198 million of the total. Adding money spent by the privately funded UH Foundation, spending by students, out-of-town visitor spending related to UHM sponsored professional meetings and conferences brings total UHM-related expenditures to $1.40 billion in FY2012, 90% of which was spent locally.

Overall, the $1.40 billion of education-related expenditures attributable to UHM generated $2.45 billion in local business sales, $735 million in employee earnings, $131 million in state tax revenues, and slightly under 20,000 jobs in Hawai‘i in FY2012. This represented approximately 3.4% of total jobs, 2.5% of worker earnings, and 2.2% of total state tax revenues.

Looking to the future, the university’s Hawai‘i Innovation Initiative ( HI2 ) plans to more than double the UH system’s current level of extramural research funds from less than $500 million to an ambitious $1 billion per annum. If the HI2 successfully doubles research expenditures, our analysis suggests more than 5,000 new jobs would be created from the ripple effects of the research spending alone, independent of any technology transfer and other jobs created as a direct result of the research.

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