Study finds UC Berkeley contributes heavily to local economy

Bay City News
Wednesday January 23, 2002

A new study by a San Francisco-based consulting firm says the University of California at Berkeley is the fifth-largest employer in the Bay Area and contributes more than $1 billion annually overall to personal income in the region. 

The report this month by Sedway Group, “Building the Bay Area’s future: A Study of the Economic Impact of the University of California, Berkeley,” also indicates that the school's research and educational enterprise generates more than a half-billion dollars in new money annually for the regional economy. 

“What struck me was that when we commissioned this study more than a year ago, the Bay Area was enjoying an economic boom. Now, we are feeling the effects of a recession. But this report shows that whatever the climate, UC Berkeley is a major contributor to the vitality of the Bay Area economy and in the quality of life we enjoy here,” said UC Berkeley Chancellor Robert Berdahl. 

The study, which provides data on the campus' purchasing,employment and research activity, examines the economic impact of the school on the city of Berkeley, the East Bay and the Bay Area as a whole. 

The study found that in 1998-99, the university employed 13,520 workers, paid out $603 million in salary and wages and generated 20 jobs for every $1 million the campus spends. 

Additionally, the researchers reported that the campus generates more than $1.1 billion annually in personal income in the Bay Area and that the school does business with 2,400 vendors -- 40 percent of whom are small business owners. 

The report also indicated that UC Berkeley has a more significant impact on the local economy than Harvard, Johns Hopkins and Columbia universities do in their respective communities. Those three universities are considered to be major employers in their regions. 

“UC Berkeley is more closely aligned with the local economy than other universities,” the report states, even though the other three institutions also have their own medical schools and affiliated hospitals, unlike UC Berkeley. 

Finally, the study took into account the school's construction spending and how new projects help create jobs and new business for contractors and other vendors. Currently the campus has 98 major projects under way, with costs estimated at $766 million; upcoming projects are expected to total an additional $259 million. 

“What you see in these findings, and what is particularly gratifying, is that the enterprise we call UC Berkeley is more tightly woven into the fabric of life in the Bay Area, and especially in the East Bay, than most people may realize,” Berdahl said.