Study: NJ community colleges add $12.8B to state economy

The basics:

• NJ’s 18 community colleges generate $12.8B annually for state economy
• Colleges support 135,492 jobs, accounting for 1 in every 46 positions in NJ
• Alumni earnings contribute $11.7B of total economic impact
• Students receive a 4.3-to-1 return on investment in lifetime earnings

A new independent study finds New Jersey’s 18 community colleges generate $12.8 billion annually for the state economy. The report reinforces the schools’ role as a major driver of jobs, earnings growth and public return on investment in the Garden State.

The New Jersey Council of County Colleges commissioned “The Economic Value of New Jersey’s Community Colleges”, which Lightcast conducted. The nationally recognized economic and data consulting company has deep expertise in labor market, workforce and higher education impact analysis.

Lightcast analyzed Fiscal Year 2023–24 academic and financial reports from the colleges, as well as industry and employment data form the U.S. Bureau of Labor Statistics and the U.S. Census Bureau.

That $12.8 billion annual topline accounts for nearly 1.6% of the New Jersey’s total gross state product.

The colleges support 135,492 jobs statewide, which means one out of every 46 jobs in New Jersey is tied to their activities, students or alumni. The largest share of that impact – $11.7 billion – comes from alumni earnings.

Confirmation

“This analysis quantifies and reinforces what we already knew about the substantial economic impact of New Jersey’s 18 community colleges,” said Aaron Fichtner, president of the NJCCC. “Community college alumni, through their knowledge, creativity, and entrepreneurship, meet the workforce needs of the state’s evolving innovation economy and, through higher lifetime earnings, contribute directly to our state’s economic prosperity.”

Other key takeaways from the analysis:

• $833.3 million in the form of operations spending including payroll and facilities maintenance
• $35.1 million for new construction spending
• $206.9 million of spending by New Jersey community college students
• Associate degree holders earn $10,100 more annually than workers with only a high school diploma
• Students receive a 4.3-to-1 return, gaining $4.30 in lifetime earnings for every $1 invested (14.9% annual rate of return)
• Taxpayers see a 2.6-to-1 return, with $1.7 billion in added tax revenue and public sector savings
• Society gains an 8-to-1 return, totaling $15.7 billion in long-term economic and social benefits
• Full-time students save about $16,000 per year compared with attending a four-year public college in the state

Opening doors

“Our community colleges open doors of economic opportunity for New Jerseyans across the state, including many who are low-income, first generation, and from backgrounds traditionally underrepresented in higher education,” said Jessica Stewart Purnell, NJCCC‘s chair and trustee at Camden County College.

“As this study indicates, every dollar we invest in New Jersey’s community colleges pays dividends to our students, our employers, our communities, and our state,” said NJCCC Chief Innovation and Policy Officer Maria Heidkamp. “We look forward to working with the new Sherrill Administration and our State Legislators to expand access to affordable, high-quality education at our state’s 18 community colleges.”

The full study can be found here.