Benefiting California

Perhaps no other state-funded institution provides a more powerful return on investment than the CSU, which serves as an economic catalyst for the state, and consistently boosts the earnings capacity of its alumni.

Having a college degree opens doors to career opportunities, enhances earning potential and increases social mobility.  In fact, CSU campuses rank among the best in the nation for value, return on investment and social mob​ility, and the CSU is one of the most affordable public universities in the U.S. The university’s 23 campuses annually graduate more than 125,000 job-ready alumni who contribute significantly to California and its economy.

However, the impact of the CSU goes beyond the high-quality education that it provides to its student body. State investment in the CSU as well as spending by the university and its students create ripple effects that boost California’s overall economy, supporting jobs, industry activity and tax revenue.

THE RIPPLE EFFECT

The impacts associated with the CSU begin with the university itself – its faculty, staff, students, and alumni – and then percolates throughout the state, generating successive rounds of economic activity as a result ​of the interlinkages between different economic sectors and regions.

In this assessment of the CSU’s core economic impact, two types of economic impacts are modeled: those generated by CSU-related expenditures and the impact of earnings of CSU alumni that are attributable to their degree. ​

In the 2018-2019 academic year, CSU-related expenditures were responsible for supporting nearly 209,400 jobs and $26.9 billion in industry activity throughout California, as well as $1.6 billion in state and local tax revenue.

BENEFITING CALIFORNIANS

The CSU provides Californians access to affordable high-quality higher education, which gives them the opportunity to enhance the trajectory of their lives. Having a college degree opens the door to new career opportunities and higher earning potential. For example, a bachelor’s degree holder in California earns on average nearly twice as much as a high school graduate. While that level of income can have a transformative effect on individuals and their families, it also ripples throughout regional and community economies.

In total, CSU alumni active in California’s labor force in 2019 earned incrementally higher earnings of $70.6 billion because of their CSU degree. That increased spending power from CSU alumni supported approximately 747,900 jobs, $88.1 billion in industry activity, and $5.9 billion in state and local tax revenue.

RETURN ON INVESTMENT

The magnitude of the CSU’s economic impact on California can also be illustrated by the state’s annual budgetary investment in the university. In 2018-19, California invested $3.85 billion in CSU’s operation and capital appropriations.

For every $1 California invests in the CSU, $6.98 of industry activity is stimulated in the state. When the impact of the enhanced earnings of CSU alumni are factored in, the ratio rises to $29.90 in total economic activity for every dollar the sta​te invests in the CSU.

Such a massive return on investment is noteworthy. In fact, state and local government annually receive more in tax revenue generated by CSU-related activities than those same governments expend in financial support of the university, making the CSU increasingly valuable each year.