Raritan Valley Community College and its students added $410 million in income to Somerset and Hunterdon counties’ economies in FY 23-24 and supported 4,204 regional jobs, according to a new economic impact study announced Thursday by RVCC.
The study was commissioned by RVCC as part of a larger statewide study conducted through Lightcast by the New Jersey Council of County Colleges. “The Economic Value of Raritan Valley Community” quantifies the value RVCC brings to the community by promoting economic development, enhancing students’ careers, and improving the quality of life for residents in Somerset and Hunterdon counties.
“The economic impact study confirms we already knew about Raritan Valley Community College: An investment in RVCC benefits all stakeholders—students, taxpayers, local businesses, and society as a whole,” said RVCC President Michael J. McDonough.
“From preparing students to enter the regional workforce as highly educated, well-skilled employees, to supporting local business by increasing consumer spending, to improving students’ lives by helping to raise their lifetime earnings, to assisting society overall by generating a variety of savings through students’ improved lifestyles, RVCC truly enriches the quality of life for everyone in Somerset and Hunterdon County,” McDonough said.
Key findings of the report include:
- In FY 2023-24, RVCC and its students added $410 million in income to Somerset and Hunterdon County economies, supporting 4,204 regional jobs—or 1 out of every 88 jobs in the two counties.
- The net impact of the College’s operations spending added $44.2 million in income to the regional economy in FY 2023-2024.
- Taxpayers provided RVCC $35.6 million in funding in FY 2023-2024. In return, they benefited from students’ higher lifetime earnings and increased business output and purchases of goods and services, amounting to $93 million.
- For every dollar of public money invested in educating RVCC students, taxpayers will receive $3.20 in return over the course of the students’ working lives. This represents an annual rate of return of 8.8%, which compares positively to other long-term investments in the public sector.
- The net impact of RVCC alumni currently employed in the regional workforce amounted to $360.8 million in added income in FY 2023-2024, which is equivalent to supporting 3,361 jobs.
Regarding students, the study found:
- The average student’s income increased by $3.90 for every $1 they invested in their education.
- Students enjoy a 14.9% average annual rate of return on their RVCC educational investment.
- The average student who receives an associate degree from RVCC will see an increase in earnings of $11,400 each year, compared to someone with only a high school diploma or equivalent working in New Jersey.
- As RVCC students are educated, they are statistically more likely to develop healthier lifestyles that lead to reduced government-support services. This leads to $20.7 million in savings to state and local taxpayers.
Data and assumptions used in “The Economic Value of Raritan Valley Community” study are based on several sources, including the FY 2023-24 academic and financial reports from RVCC, industry and employment data from the U.S. Bureau of Labor Statistics and U.S. Census Bureau, outputs of Lightcast’s Multi-Regional Social Accounting Matrix model, and a variety of studies and surveys relating education to social behavior. The study applies a conservative methodology and follows standard practice using only the most recognized indicators of economic impact and investment effectiveness.
RVCC’s economic study was part of the larger, statewide NJCCC study released last month, “The Economic Value of New Jersey’s Community Colleges,” which underscored the value of New Jersey’s community colleges to society. The state’s 18 community colleges add $12.8 billion to New Jersey’s economy, which is approximately 1.6% of the total gross state product. This number reflects an increase in economic activity that supports 135,492 jobs, which is one out of every 46 positions in the state’s employment market.
In addition, for every dollar invested in a New Jersey community college, taxpayers gain $8 in added revenue from students’ increased lifetime earnings and increased business output, raising economic prosperity in the state. Finally, graduates of a New Jersey community college gain $4.30 in higher lifetime earnings for every $1 they invest in their higher education. This equals an average annual return of 14.9%.
Lightcast is a nationally recognized economic and data consulting company with deep expertise in labor market, workforce, and higher education impact analysis. Data and assumptions used in the study are based on FY 2023-24 academic and financial reports from the colleges; industry and employment data from the U.S. Bureau of Labor Statistics and the U.S. Census Bureau; Lightcast’s modeling; and studies and surveys relating education to social behavior.
