Analysis shows state’s Medical School investment pays substantial dividends

by: Alison Duffy and Jim Fessenden , UMass Medical School Communications
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For every dollar Massachusetts invests in the UMass Medical School, the state’s only public medical school generates another $37 through research and the programs and services that advance the institution’s mission of improving the health and well being of the commonwealth’s residents, according to a report issued this week by the UMass president’s office and the UMass Donahue Institute (UMDI). The analysis conducted by the UMDI Economic & Public Policy Research Unit focuses on overall impact of both the University system and the five campuses, as well as economic and employment results, and is based on expenditures in fiscal year 2010.

Overall, the University system contributed $4.83 billion of economic activity to the state, including more than $334 million in one-time construction contributions that generated 1,857 jobs. The five-campus system employs 16,623 full- and part-time faculty and staff, while also supporting about 16,600 additional external jobs across the state in fields such as transportation, utilities, education, health services, leisure and hospitality.

“Throughout the years, the Medical School has strategically diversified its revenue streams and has matured into a very forward-thinking institution that is able to support its core missions while also producing considerable benefit for the region and the state,” said Michael F. Collins, MD, UMMS chancellor and the University’s senior vice president for the health sciences. “This report is confirmation of what we’ve known for some time—UMMS is an investment that is paying substantial dividends for the residents of Massachusetts.”

“The biotechnology industry in Central Massachusetts would not exist without UMass Medical School,” said Kevin O’Sullivan, president and chief executive officer of Massachusetts Biomedical Initiatives. “We would not be here without the Medical School. UMMS is key to creating new jobs—and nurturing emerging industries that have become central to the Massachusetts economy—here in Worcester and beyond.”

Specifically, the analysis of UMass Medical School shows that in fiscal year 2010:

  • UMMS contributed $1.75 billion of economic activity to the state economy, including the contribution of the local operating expenditures of the campus, one-time major construction expenditures and spending by faculty, staff and students. 
  • Included in the $1.75 billion contribution were one-time construction project expenditures totaling more than $67 million in direct construction expenditures and nearly $51 million in additional economic activity for a total of $118 million in one-time construction contributions. These construction projects yielded more than 875 jobs. 
  • The commonwealth invested a net $47 million in UMMS (excluding federal stimulus funds), representing four percent of the campus’ $1.11 billion total operating budget.
  • The ratio of total contributions by UMMS ($1.49 billion) to commonwealth investment ($47 million) was more than 37 to 1.
  • UMMS employed approximately 5,530 full- and part-time faculty and staff and 1,270 other employees and students for a total of approximately 6,800. 
  • Spending by UMMS, its employees and students helped to support an additional 5,439 jobs in the state; those jobs occurred in various sectors of the state economy. The largest sectors include more than 1,170 jobs in trade, transportation and utilities; more than 1,090 jobs in professional and business services; and more than 1,000 jobs in education and health services.