Community colleges add $6.6B into Alabama's economy

When it comes to creating a positive return on investment, the Alabama Community College System is delivering for the Alabama taxpayer.

According to a recent study, students and alumni of community colleges within the system added $6.6 billion to Alabama’s economy in 2021, supporting one out of every 27 jobs in the state.

The independent report by LightCast, a global leader in labor market analytics for colleges and universities, estimates the Alabama Community College System’s economic impact represents about 2.7% of Alabama’s gross state product, which reflects 98,923 jobs in the state. Additionally, taxpayers see a net benefit of $1.1 billion in added tax revenue from students’ higher lifetime earnings and increased output to businesses.

“The results of the analysis demonstrate the ACCS is a strong investment for all three major stakeholder groups—students, taxpayers, and society,” said Jimmy H. Baker, Chancellor of the Alabama Community College System. “Students receive a great return for their investments in an education. At the same time, the taxpayers’ investment in the ACCS returns more to government budgets than it costs and creates a wide range of social benefits throughout Alabama.”

Alabama’s community college alumni who are currently employed in Alabama’s workforce added $5.7 billon in income during the analysis year. A total of 95 percent of Alabama community college alumni remain in the state to live and work.

“Our legacy centers on helping people develop the skills they need to build the framework of our state’s economy, and the data this report provides proves we are on a forward path of excellence in that pursuit,” said Chancellor Baker.

“Residents are receiving a strong return on investment when they invest in training at one of our colleges – whether through an adult education program, a rapid skills training program, or through a rigorous certification or academic transfer program that allows them to move toward completing a bachelor’s degree. And, they’re using that training to make a difference right here in Alabama.”

The total impact was derived from the individual impacts related to the system’s operation and construction spending, business support services, student spending impact and the impact of alumni.

Among the report’s highlights:

The impact of the Alabama Community College System, which celebrates 60 years as a system this year and represents 24 community and technical colleges across Alabama, supported 98,923 jobs in FY2021. For perspective, the activities of the colleges and their students support one out of every 27 jobs in Alabama.
Taxpayers, who provided the Alabama Community College System with $869.8 million of funding in FY2020-21, received an added tax revenue benefit of $1.1 billion.
The ACCS generates $7.40 for every dollar invested in ACCS, for as long as the colleges’ FY2020-21 students remain active in the state workforce.
The average Alabama community college graduate earns $7,900 more each year than a resident who does not obtain more than a high school diploma.
The average annual return for Alabama community college students is 22.1%.
The net impact of the colleges’ operations spending added $535.8 million in income to the state economy.
The net impact of the colleges’ construction spending was $13.3 million in added income for Alabama.
The jobs retained or created and additional investments by businesses supported by the Alabama Technology Network, an entity of the Alabama Community College System, created $206.5 million in added income.
As a result of the $1.8 billion invested by Alabama to support the ACCS, the economy will grow by $12.8 billion over the course of students’ working lives.

LightCast analyzed data using Fiscal Year 2020-21 academic and financial reports from Alabama’s community and technical colleges, as well industry and employment data from the Bureau of Labor Statistics and Census Bureau.

About ACCS

The Alabama Community College System is Alabama’s gateway to first-class, affordable education and technical training to compete in a constantly evolving workforce. With 24 community colleges in more than 130 locations, the ACCS benefits more than 144,000 Alabamians through various certification, credential, dual enrollment and degree programs ACCS offers alongside leading industry partners. A total of 95% of residents who study at Alabama’s community colleges remain in the state. The System includes the Alabama Technology Network, which provides extensive training and service offerings directly to business and industry. ACCS is governed by the Alabama Community College System Board of Trustees.