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New study demonstrates huge local economic impact of universities

31 July 2020

Universities typically support up to one additional job in the immediate local economy for every person they directly employ, according to a new analysis by Hatch Regeneris for UCU.

Universities are often among the largest local employers, with 19 UK institutions directly employing more than 5,000 people, and 10 of these accounting for at least 5% of all jobs in their local authority area.  

The positive effects of universities on local employment are compounded where cities host more than one institution. The review modelled universities in 25 cities and looked at the number of jobs they support and how they bolster local economies.

It estimates that 22,000 jobs in Manchester, 150,000 in London, 18,000 in Birmingham, 22,000 in Glasgow, 29,000 in Edinburgh and 15,000 in Cardiff are dependent directly or indirectly on their universities.

The study also showed the critical importance of single institutions to smaller towns and cities. The researchers cite St Andrews where students make up a third of the local population and the university supports over 4,000 jobs.

Universities bring relatively high wages to these areas as well as associated skilled jobs across a range of occupations including construction, engineering and entertainment. This includes places such as Plymouth, Middlesbrough, Stoke and Swansea where at least 5% of local jobs are linked in one way or another to the local institution.

In the North-East, there are more people directly employed in higher education (20,000) than there are in car manufacturing (9,000). These jobs are at a range of skill levels, but, on average, they are high-quality and well-paid. The average salary at the University of Sunderland, for example, is more than a third higher than the average for all jobs in the city. 

The review analysed 74 existing studies of institutions' impact and modelled a further 90 in order to produce the comprehensive picture of UK universities' role in their local economy. It produced detailed analysis of 25 cities highlighting the number of jobs universities support and measuring their economic contribution.

The analysis looks at goods and services produced locally through universities' supply chains and the money spent by employees and students. The figures show how universities are often among the single largest contributors to the local economy.

UCU general secretary Jo Grady said: 'This review shows that universities are a very significant factor in many local economies. Allowing universities to fail because of the health crisis will mean the economies of many of our towns and cities will also fail. Universities are vital in providing educational opportunities, but they also have a huge impact in creating local jobs, supporting local businesses, and attracting business to the area.

'With every university job leading to another job in the local area, it is now vital that instead of talking our universities down the government protects them. The Welsh government has led the way and the Westminster government now needs to come up with a comprehensive financial support package to ensure that no institution will fail.'

Hatch Regeneris director Tim Fanning said: 'The evidence from this review implies that areas hosting institutions that are vulnerable to contraction could be exposed to a wider economic shock - even before we consider the effect on access to university, local labour markets, and research and innovation.

'From the point of view of the government's levelling up agenda, the data also shows that places that are lagging behind economically are sometimes especially dependent on their local university.'

Recent YouGov polling for UCU highlighted how people recognised the importance of their local university on jobs and the economy. Two-thirds (66%) said they feared that there would be a negative impact on the local economy if student numbers dropped as a result of the Covid-19 crisis. While three-quarters (75%) feared a negative impact should a local university go bust. 

A third of those in work (33%) said the local university was important to their own job. While over two-fifths (42%) said they knew someone who studied or worked at a local university, or whose employment depended at least in part on the university.

A report from UCU in April warned of a £2.5bn loss in income for universities from a drop in student numbers, which would result in a £6bn hit for the economy. While a report from the Institute for Fiscal Studies earlier this month predicted that the pandemic would leave some universities struggling to survive

CityInstitutionDirect jobs within the Uni (FTE)All jobs (including supply chain, induced, student and visitor spend)indirect, induced, student and visitor related jobsMultiplier (=ratio between direct jobs and all jobs)Total local GVA, £m (including multipliers)


Aston University1,7903,0501,2601.71160
Birmingham City University2,5204,6002,0801.82280
Newman University3105502401.7530
The University of Birmingham7,4508,7001,2501.17530
University College Birmingham5801,0004201.7460
All Birmingham12,64017,9105,2701.421,050


The University of Bradford1,2602,1008401.67120
All Bradford1,2602,1008401.67120


The University of Brighton2,4104,9002,4902.04480
The University of Sussex2,5705,1802,6102.02340
All Brighton4,97010,0805,1102.03820


The University of Bristol6,58016,0309,4502.44920
University of the West of England, Bristol3,2207,8304,6102.44400
All Bristol9,80023,86014,0602.441,320


Anglia Ruskin University1,9603,7701,8101.92240
The University of Cambridge11,31024,70013,3902.181,800
All Cambridge13,26028,46015,2002.152,040


Cardiff Metropolitan University1,1402,3101,1702.03140
Cardiff University6,0409,3603,3201.55500
University of South Wales1,9803,0701,0901.55260
All Cardiff9,16014,7405,5801.61900


Coventry University4,0206,1302,1101.53390
The University of Warwick6,2307,5601,3301.21530
All Coventry10,24012,4002,1601.34920


Edinburgh Napier University1,4302,9001,4702.03350
Heriot-Watt University1,8003,8302,0302.13180
Queen Margaret University, Edinburgh4208404202.0350
The University of Edinburgh10,48021,31010,8302.031,420
All Edinburgh14,12028,88014,7602.052,000


Glasgow Caledonian University1,4005,9204,5204.24480
Glasgow School of Art4507002501.5540
Royal Conservatoire of Scotland2904301401.530
The University of Glasgow6,3409,0002,6601.42500
The University of Strathclyde3,5805,5301,9501.55350
All Glasgow12,05021,5709,5201.791,400


The University of Hull2,3004,1001,8001.78370
All Hull2,3004,1001,8001.78370


Leeds Arts University2404101701.7320
Leeds Beckett University2,3404,1801,8401.79250
Leeds Trinity University3806702901.7940
The University of Leeds7,71011,6803,9701.52730
All Leeds10,65016,9306,2801.591,040


De Montfort University2,3404,4002,0601.88250
The University of Leicester3,4605,1901,7301.5310
All Leicester5,8009,5903,7901.65560


Liverpool Hope University6301,0804501.7160
Liverpool John Moores University2,4704,9002,4301.98260
Liverpool School of Tropical Medicine5206401201.2350
The Liverpool Institute for Performing Arts140220801.6210
The University of Liverpool5,60010,7905,1901.93650
All Liverpool9,36017,6208,2601.881,030


Bishop Grosseteste University3204801601.5420
The University of Lincoln1,7702,3505801.33180
All Lincoln2,0802,8307501.36200


Royal Northern College of Music2403901501.6720
The Manchester Metropolitan University3,9407,6303,6901.94400
The University of Manchester10,25013,9703,7201.36830
All Manchester14,42021,9907,5701.531,250


Teesside University1,6702,9801,3101.79170
All Middlesbrough1,6702,9801,3101.79170


Newcastle University5,6808,8503,1701.56490
University of Northumbria at Newcastle2,7204,6701,9501.72280
All Newcastle8,40013,5205,1201.61770


The Nottingham Trent University3,8007,3403,5401.93580
University of Nottingham7,1108,7501,6401.23720
All Nottingham10,91016,0905,1801.481,300


Oxford Brookes University2,0004,3701702.19170
The University of Oxford13,18028,7902,0002.182,000
All Oxford15,18033,1602,1602.182,160


Plymouth College of Art2303601301.620
University of Plymouth2,5304,7802,2501.89270
University of St Mark and St John2704902201.8630
All Plymouth3,0205,6302,6101.87320


Sheffield Hallam University3,6709,3405,6702.54420
The University of Sheffield6,85010,1803,3301.49670
All Sheffield10,52019,5209,0001.861,090


Solent University1,1303,7302,6003.3190
The University of Southampton5,67014,0208,3502.47900
All Southampton6,80017,75010,9502.611,090


Keele University1,8103,4201,6101.89160
Staffordshire University1,1502,7501,6002.39120
All Stoke-on-Trent2,9606,1703,2102.09280


The University of Wolverhampton2,2003,7301,5301.7220
All Wolverhampton2,2003,7301,5301.7220


Birkbeck College1,1302,8101,6802.49170
Brunel University London1,9407,5605,6203.9510
City, University of London2,1205,8103,6902.74400
Conservatoire for Dance and Drama4007703701.9310
Courtauld Institute of Art1403101702.2140
Goldsmiths College1,3603,7002,3402.72230
Guildhall School of Music and Drama3207003802.1940
Imperial College of Science, Technology and Medicine7,84016,3308,4902.081,310
King's College London7,42017,1009,6802.31,220
Kingston University1,6703,8502,1802.31220
London Business School8101,6808702.07190
London Metropolitan University8802,6201,7402.98150
London School of Economics and Political Science2,9306,7203,7902.29590
London School of Hygiene and Tropical Medicine1,4202,1807601.54190
London South Bank University1,4004,1802,7802.99310
Middlesex University1,7305,3103,5803.07370
Queen Mary University of London4,3807,7803,4001.78560
Ravensbourne University London2307405103.2250
Roehampton University9803,2802,3003.35220
Rose Bruford College of Theatre and Performance70210140320
Royal Academy of Music2205002802.2730
Royal College of Art3909906002.54100
Royal College of Music2305102802.2240
SOAS University of London9402,0201,0802.15140
St George's, University of London7701,8501,0802.4130
St Mary's University, Twickenham6201,7401,1202.81100
The Institute of Cancer Research1,0301,8408101.79210
The Royal Central School of Speech and Drama2004202202.130
The Royal Veterinary College9101,6307201.79120
The University College of Osteopathy801901102.3810
The University of East London1,2503,7702,5203.02240
The University of Greenwich1,6805,2103,5303.1340
The University of West London9501,8509001.9590
The University of Westminster1,6005,1203,5203.2410
Trinity Laban Conservatoire of Music and Dance2806503702.3240
University College London11,98022,41010,4301.871,760
University of London (Institutes and activities)9301,3704401.47120
University of the Arts, London2,7206,7904,0702.5540
All London65,950152,50086,5502.3111,250
Last updated: 31 July 2020