Report: Stony Brook's ripple effect on economy worth $7.23B a year
A report from Stony Brook University, seen on March 1, 2018, found that the school and its medical center had 2015-2016 operating expenditures of $2.69 billion. Credit: Newsday/John Paraskevas
Stony Brook University's ripple effect on Long Island's economy is worth $7.23 billion a year and supports 54,637 local jobs, according to a new report.
The study by John A. Rizzo, professor of economics and population, aims to capture the broader impact of the university and its medical center, Long Island's largest "single-site employer," with nearly 16,000 full- and part-time employees, including 2,500 faculty.
The university and its affiliated hospital had 2015-2016 operating expenditures of $2.69 billion, an increase of $689 million since the last economic impact study in 2008.
"The last one was dated," Rizzo said of the 2008 report, which calculated the university's regional economic impact at $4.65 billion.
Those economic impacts — calculated by using multipliers developed by the federal Bureau of Economic Analysis — would, for example, include the direct effect of a restaurant meal purchased by a Stony Brook employee, but also the indirect effect when the restaurant then pays landscapers or sends its tablecloths to a laundry service.
Such direct and indirect economic activity supports 8 percent of all jobs in Suffolk County, the study said.
The multiplier also measures how Stony Brook increases worker productivity on the assumption that the institution, part of the State University of New York, attracts some students who otherwise would not attend a four-year college and would be earning lower wages, Rizzo said.
"Five percent of its students each year would not have graduated from college," the study said. "This is a very conservative assumption."
Stony Brook's operating expenditures — wages and salaries plus utilities, minus estimated employee health care expenditures — were $2.69 billion in 2016 compared to $929.1 million in 2008.
Stony Brook University Hospital accounted for 51 percent of revenue at $1.2 billion, followed by state appropriations of $470.7 million, at 21 percent, and tuition and fees of $244.6 million, or 11 percent.
A 2016 study from the nonprofit National Bureau of Economic Research in Cambridge, Massachusetts, backed up the notion that the presence of a university stimulates economic growth in a region.
That study of 1,500 regions in 78 countries between 1950 and 2010 found that "increases in university presence are positively associated with faster subsequent economic growth."
Ken Schachter covers corporate news, including technology and aerospace, and other business topics for Newsday. He has also worked at The Miami Herald and The Jerusalem Post.
