Wednesday, August 02, 2000
UC Med Center boosts economy
$3.05 billion impact second only to airport
By Tim Bonfield
The Cincinnati Enquirer
The University of Cincinnati Medical Center contributes $3.05 billion a year to the Tristate economy, according to a study released Tuesday, a figure that places it second only to the airport as an engine of economic growth.
It may raise eyebrows that the UC Medical Center's economic impact dwarfs many other high-profile projects, including new stadiums for the Cincinnati Reds and Bengals. But the study's findings come as little surprise to people involved in economic development.
THE VONTZ CENTER IS PART OF A BURGEONING BIOTECH PRESENCE AT THE UNIVERSITY OF CINCINNATI.|
(Enquirer file photo)
| ZOOM |
The medical complex is a pretty important economic driver. It's a pretty substantial piece of what we are, said Joe Kramer, vice president of economic development at the Greater Cincinnati Chamber of Commerce.
Year after year
If anything, I'm surprised (the impact) isn't a little larger, said Richard Stevie, a Cinergy executive who is chairman of the Chamber of Commerce economic advisory committee.
When you think about the stadiums, the total spending for both isn't quite a billion dollars. And that's a one-shot deal, Mr. Stevie said. The impact of the medical center goes on year after year.
The study was conducted by Pittsburgh-based Tripp Umbach & Associates, which has performed similar studies of academic medical centers for the Association of American Medical Colleges. Economic experts contacted by The Cincinnati Enquirer said they were familiar with the firm and that its methods appeared to reflect accepted standards for economic impact studies.
Some figures from the UC Medical Center Impact Study:|
Total economic impact: $3.05 billion
Direct impact of jobs and spending: $1.33 billion
Indirect impact from respending: $1.72 billion
Direct employment: 14,746 full-time jobs
Indirect job impact: 29,771 full-time jobs
Source: Tripp Umbach & Associates
Backs up request
UC officials hope the report will bolster their efforts to raise more than $200 million from government and private sources to expand its biotech research efforts and to rebuild its aging 1-million-square-foot medical sciences building.
People know we provide education and medical care. But frequently people do not know what we do in terms of economic impact, said Dr. Donald Harrison, senior vice president and provost for health affairs at UC.
In terms of impact, the medical center is nothing less than one of the biggest employers in town, a huge purchaser of goods and services and a key source of expertise that many business leaders hope will blossom into a full-fledged biotech industry.
The UC Medical Center actually includes several affiliated organizations: University Hospital, Children's Hospital Medical Center, the VA Medical Center, Shriners Burns Institute, Hoxworth Blood Center and a large doctor group called UC Physicians. The study also counts the UC colleges of medicine, nursing, pharmacy and allied health.
Combined, the medical center includes more than 14,000 employees and more than 3,000 students.
The institutions bring more than $123 million a year in outside research grants to town and spend hundreds of millions per year on items from surgical supplies to the telephone bill.
All these direct spending factors add up to about $1.3 billion a year. To arrive at the total economic impact of $3.05 billion, the study assumes another $1.30 or $1.7 billion a year gets respent in the community.
That's a reasonable multiplier, said George Vredeveld, an economist who has led impact studies of other local projects as director of the UC's Center for Economic Education. I'm not surprised that it's a large number because I know how important the health-care industry is. Three billion dollars is very significant. So are 14,000 employees.
Airport is bigger
The only other major Tristate institution that surpasses the economic impact of the UC Medical Center is the Greater Cincinnati/Northern Kentucky International Airport. In 1998, an economic impact study reported that the airport contributes $3.9 billion a year to the economy, a figure that could rise to $6.4 billion should the airport win approval to build a new north-south runway.
Business leaders have long valued the UC Medical Center, both as an economic force and for its potential to spin off new companies involved in biotech research.
Biotech is certainly one of the key priorities of future development in our region. But it is a key, not the only key, Mr. Kramer said.
Taken together, the riverfront developments on both sides of the Ohio River including stadiums, the new aquarium and other projects add up to a powerful regional tourism magnet, Mr. Kramer said.
Meanwhile, a recent rush of e-commerce start-ups in Over-the-Rhine demonstrates potential growth for high-tech jobs that aren't tied to medicine, Mr. Kramer said.
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