Students give economy £28 billion boost

College students have boosted the UK economy by £28 billion in the past 15 years, according to a report commissioned by the Association of Colleges.

The analysis, carried out by Economic Modelling Specialist Inc, found that the economic impact of colleges and graduates of colleges gave the taxpayer a return of about £1.70 on every £1 injected by the government.

The Association of Colleges president, David Collins, praised the findings, saying: “This research shows clearly that England’s further education colleges are a sound investment from multiple perspectives.

"Colleges enrich the lives of learners and increase their lifetime incomes, and they benefit taxpayers by generating increased tax revenues from an enlarged economy and reduced demand for taxpayer-supported social services.”

The figure, £28 billion, is an extrapolated estimate of the boost to the national economy in 2006/7.

The methodology used by the US-based research group, which studies the socieconomic impact of further education institutions, consisted of gathering the qualifications students attained at 55 colleges across England since 1993.

It then converted the qualifications into an earnings-based model and compared them with the income of those in the work place who had no qualifications.

Another method used, was based on calculating the amount saved by direct teachings at the colleges.

The commission found that the costs saved by learning about reducing crime, health and unemployment problems means that for every qualification gained, the tax payer saves £89 in "avoided social costs."

Secretary for universities, innovations and skills, John Denham, said: “Colleges are not just a foundation of the country’s economy, but also an investment in the nation’s future.

"The government will invest £4.7 billion in further education and training this year and it’s vital that we understand not just the role they play in unlocking an individual’s talent, but also how pivotal they are in building strong communities – economically and socially."