Spending on buildings and facilities by Russell Group universities will generate billions for the economy and thousands of new jobs across the country in years to come. It is anticipated that every pound spent will create £4.89 in return and 100,000 new jobs will be created.
Economic research, carried out by BiGGAR Economics, has looked at planned spending by the 24 Russell Group Universities over the next four years. It finds that Russell Group universities will spend more than £9 billion on capital projects between 2012/13 to 2016/17. This is similar to the amount spent on the Olympics or the Government’s current railway investment programme.
The money comes from a range of sources including government grants for capital, income from research and teaching, private donations and borrowing.
Researchers looked at the long term gross value added this investment would produce and calculated that:
· Capital investment by Russell Group universities is expected to generate gross value added (GVA) with a current value of £44.3 billion for the UK economy over the next 25 years.
· This work will support more than 98,500 new UK jobs - including around 37,800 temporary jobs during
the five-year construction period, 45,000 permanent operational jobs and almost 15,700 permanent jobs
supported by the wider impact of the work undertaken in the new facilities.
· This investment should generate £4.89 for the UK economy for every £1 invested.
The investment ranges from new student accommodation, medical research facilities and science labs to new office space and facilities to help start-up businesses and universities work better together.
The researchers also looked at the impact of this investment in different regions of the country – calculating the number of jobs generated and the total return on the investment in each region. Their research shows that the biggest impact could be in the North of England – but all regions will see large benefits.
For example, Science Central - one of the UK’s largest city centre development sites being delivered by Newcastle Science City in conjunction with partners Newcastle University and Newcastle City Council - will provide incubator space for science and innovation focused start-ups and office space for businesses to co-locate with the University. This will develop Newcastle’s existing scientific expertise in biomedicine and ageing and healthcare into world leading sectors. Ultimately Science Central will attract private sector investment of £380 million and 1,900 jobs.
There will also be a catalytic impact as the expenditure on local services, goods and entertainments would stimulate other businesses to locate and grow and therefore increase the attractiveness and vibrancy of the area. In addition, the buildings will provide a mix of uses and opportunities to the local communities.
Dr Wendy Piatt, Director General of the Russell Group, said:
“Russell Group universities are engines of growth for the British economy. Not only do they lead the way in teaching and research – but they’re also a driving force behind the creation of new jobs, new opportunities for start-up companies and urban renewal in our cities.
“The Government have recognised much of this contribution but we would urge them to step up big capital investment in our universities. We will keep investing on behalf of our students and academics but the rest of the world are snapping at our heels and spending money to match their ambition. We must do the same.”
The report calculates the long term benefits of Russell Group university investment by looking at information gathered from the 24 universities about 69 projects where they are investing money in the next four years. Researchers have calculated the quantifiable impact of these projects by looking at three areas:
· Short-term investment impacts – such as jobs created in the construction industry
· Long-term operational impacts – like increased expenditure from the additional university staff and
students based in the new facilities
· Long-term catalytic impacts – such as medical breakthroughs, more productive students, and better
published on: 20 May 2014