NC leaders evaluate economic impact of investment in higher education

Drew Moretz, a lobbyist for the UNC system, has fielded tough questions from legislators about how state money is being used on college campuses.

“We want to make sure they feel there is a return on investment,” he said.

Moretz said he emphasizes the economic impact of the UNC system — such as the number of people it puts to work post-graduation — when lobbying legislators.

By the numbers

$6.1 billion
Estimated N.C. economic impact of 2009 UNC-system graduates
Jobs in the state filled by UNC-system graduates

But when economist Mike Walden gave a presentation last year to higher education leaders about the UNC system’s economic impact, several Republican legislators called his findings a ploy for public support.

Walden, an economics professor at N.C. State University, found that the UNC system’s teaching function benefited the state by $6.1 billion in 2009 and out-of-state students’ spending totaled $400 million.

The controversy surrounding his analysis reflects a larger debate in the state and nationwide as to whether public higher education provides an economic return on investment.

With some North Carolina leaders doubting education’s viability and less state money available, investments in the UNC system have dropped dramatically.

In 2011, a cut of $414 million caused UNC campuses to eliminate 3,000 positions and hundreds of course sections, and McCrory’s 2013-14 budget proposal includes another $139 million cut to the system.

The legislature will release its final budget next month.

Harry Leo Smith Jr., a businessman and one of 16 new appointees to the UNC-system Board of Governors, said the legislature has been reluctant to fund higher education for political and economic reasons.

“It’s a culmination of ideology and the recession,” Smith said. “When the checkbook’s empty, you’re supposed to ask a lot of questions.”

But Joe Hackney, a Democrat and Speaker of the N.C. House from 2007-2011, said the reduced investment in higher education can be attributed to Republican control of state politics.

“They’ve always been more skeptical of the value of the university system and a little more hostile to some of the things that go on at universities,” he said.

Hackney said the UNC system has provided longstanding economic benefits to the state by employing a wide range of disciplines, including medicine, public service, science and research.

Smith said the state should evaluate its investment in the UNC system through schools’ job attainment rates and graduation rates.

“There has to be some accountability to performance,” he said. “You can break it down college by college — who is doing the most with the money they get?”

Schools have to balance measures of economic impact with soft outcomes such as critical thinking, Smith said.

But David Ayers, a professor at UNC-Greensboro, said increasing emphasis on the economic impact of education is damaging.

“The legislature is trying to choose for them, and is pushing them in the direction of job training,” Ayers said.

Sen. Jeff Tarte, R-Mecklenburg, said universities need to educate students and prepare them for careers.

“You don’t want to invest in a system where nobody graduated or had an interest,” he said.

Ayers said the return on the investment in a liberal arts education cannot be measured monetarily.

“It’s pretty clear that when states invest in education systems, their graduates become more productive citizens and become leaders, and overall the economy improves.”

Contact the desk editor at

Thanks for reading.

Read more in N.C. General AssemblyUNC system

Share on social media?

Comments powered by Disqus

Please note All comments are eligible for publication in The Daily Tar Heel.

2016-17 March Madness Preview by The Daily Tar Heel

Print Edition

Print Edition