University of Calgary says it generates $16.5B in economic impact for Alberta annually

As post-secondary institutions anticipate a new "performance-based" funding model from the Alberta government, the University of Calgary is asserting that it has a multi-billion-dollar annual economic impact on the city and province.

The university's administrators say this shows the government that the U of C is a good place to invest its money.

According to an analysis by Washington-based Hanover Research, the U of C has a combined direct and indirect impact of $16.5 billion annually on the provincial economy.

"It does so through its direct activities in terms of its operations and its delivery of its programs but indirectly also through the great work that our talented graduates and students do in creating new economic prosperity and in the city," said university president Ed McCauley.

It's expected this kind of impact will be important to consider if the province's new outcomes-based funding model comes into play next year as planned, taking into account things like employment and income rates of university graduates.

At the same time the government plans to cut funding to post-secondary institutions by 20 per cent over the next three years, saying schools in other provinces run on less public money per student.

"The University of Calgary is a metrics-driven organization. We use the metrics, whether it be the percentage of our undergraduates that are employed or the outputs of our work. We use that to guide our how we develop, how we evolve and how we invest," said McCauley.

"So with the performance-based funding and as it as it rolls out, I think the University of Calgary is well positioned to help deliver on the goals and objectives for the post-secondary system in the province of Alberta." But student union president Frank Finley says he's not convinced it will matter.

By the numbers

• $3.2B estimated in demand-side economic impact/effect of U of C's spending on the province.

• $13.3 estimated in supply-side economic impact when looking at:

  • Educating people whose skills benefit the provincial economy

  • Generating alumni who become community and business leaders.

  • Stimulating business development through research and community partnerships

  • Sponsoring educational and sports events

• $8.2 billion economic impact from research alone

• $249 million in spending by visitors to UCalgary events

• 149,753 U of C alumni in Alberta

• 513 post-doctoral scholars

• Top 10 research universities in Canada

• 360 new research inventions and innovations

• 22,493 employees, making the U of C is one of the largest employers in the province.

"I worry also that performance-based funding is just a way to essentially force universities to self cut — for universities not to be able to meet metrics which are in place for them, and therefore have their budgets reduced," he said.

Finley said this type of funding model has caused problems elsewhere in the past.

"The funding system can actually be inefficient and ineffective in and of itself," he said. "Ontario had tried a performance-based funding model, which did not yield the results they were expecting. I worry we would run into situations similar here."

McCauley said the report highlights a few things he's really proud of.

"If you take a look at the investment we attract from outside the province of Alberta, over $300 million comes in to support some of our research activities. Those funds directly support jobs at the University of Calgary, employing people," he said.

"But it also helps to create a great student experience in terms of experiential learning opportunities for our students, as well as engaging with our community."

McCauley said that investment attracts talent from around the world to come to the university, "which creates new ideas and new opportunities for how we can help diversify and support quality of life in Calgary."

Finley said the government should see institutions like the U of C as solid investments.

"Government needs to understand that for every dollar they put into post-secondary, they get more than a dollar back in investment into the province and that it makes sense to have a robust and very well funded post-secondary system," he said.

The outcomes-based funding model was first announced by Alberta's advanced education minister Demetrios Nicolaides in January 2020, with the intention of implementing it in April 2020.

At the time, Nicolaides said Alberta's 26 publicly funded institutions would then get money based on up to two dozen different measures, which will be weighted differently depending on the institution, and introduced in a phased approach over three years.

In June 2020, the province announced that because of the pandemic it would be delaying the new funding model indefinitely and be launching a review of the post-secondary sector.

"We do still plan to introduce performance-based funding models for the 26 publicly funded institutions, but are still determining when they will be implemented. We are also still determining what metrics will be used for the models," advanced education press secretary Taylor Hides said in an email.

"Alberta's government values the University of Calgary and its contribution to our provincial economy, and we look forward to continuing to work with them on the delivery of high-quality education."

This is the first time the U of C has had an analysis of its economic impact done since 2013.