How university success affects the surrounding economies
- A decline in public funding for research is limiting the ability of institutions to conduct studies necessary to keep up the economy, reports The Atlantic. Data shows that federal research funding has declined tremendously since 2008 by not keeping pace with inflation — and this is without factoring in the Trump administration's prospective cuts.
- Declines in public funding will affect all institutions, with Midwestern colleges and universities that are responsible for most of the nation's research seeing the impact in particular — which affects the status of their respective businesses and renders them less effective at diversifying local economies. Already, states like Illinois are seeing a Moody's downgrade in Public universities to junk-bond status.
- Trouble at research-heavy institutions could mean a blow to local economies into the future, as universities perform over half of research in the nation and in turn produce 2,600 patents and 400 companies a year, according to data from the Association of University Technology Managers.
Though policymakers often pay a great deal of lip service to the importance of research and innovation within the nation's top higher education institutions and facilities, public funding has not kept up with the pace of inflation over the last decade — rendering many players incapable of actually contributing the best their talent has to offer. The reality is that public funding has declined for the nation's institutions overall, causing many like Wheelock College to consider mergers to stay afloat and cut costs, not to mention dropping programs and selling assets. In fact, data from Higher Education and Gallup this spring shows only 51% of finance officers at small, nonprofit institutions said their campuses were financially stable, while that number was 65% last year, while other research shows states are generally spending $9 billion less on higher education than they were in 2008.
With research programs also facing issues with federal reimbursements on research, the decline in innovation that can come out of these facilities can have a negative impact on the national economy overall — as these machines of creating new jobs and patents may not be able to produce as much in the past. Higher education leaders, realizing that as local economic fail, students may not be able to attend college as much for the high costs, they must take steps to work with policymakers to explain what exactly they need. Partnerships can also help institutions that are struggling by allowing them to collaborate on research initiatives and win more grants from private organizations.
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