14 October 2024

  • Every £1 of public money put into universities across Wales generates over £13 of economic impact.
     
  • The economic impact on the UK economy associated with the Welsh higher education sector’s teaching, research and innovation activities combined was estimated at approximately £10.97 billion
     
  • Educational exports provided by Welsh universities through their international activity contributed £1.26 billion of economic impact.
     
  • The total economic impact of Welsh universities’ research and knowledge exchange activities is £1.98 billion.

In this latest report, London Economics analysed the impact of Welsh universities’ teaching, research, and innovation activities on the UK economy, focusing on the 2021-22 academic year.

The figures show that the Welsh higher education sector’s teaching, research and innovation activities had a net economic impact of £7.25 billion. When combined with previous London Economics analysis of the direct spending by the sector and the economic benefit of international students, the total impact across Welsh higher education was £10.97 billion.

Comparing against the public cost of these activities, London Economics found a cost to benefit ratio of 13.1 to 1. This means that over £13 of economic benefit is generated for every £1 of public money invested into Welsh universities.

The report was also clear on the economic benefits of higher education’s international activities, with educational exports provided by Welsh universities contributing £1.26 billion of impact.

It also shows huge positive returns to the public purse of funding students’ higher education, with the Treasury seeing a benefit of £77,000 per graduate, even when considering the cost of subsidising their education through loans and grants.

Commissioned by Universities Wales, which represents Wales’ nine universities, the report focuses on the 52,800 domestic students who joined Welsh universities in 2021-22. 

Commenting on the report findings, Professor Paul Boyle, Chair of Universities Wales said:

“Our universities are crucial to Wales’ future economic and social prosperity, acting as critical economic anchors in all parts of Wales. And today’s report reveals the full scale of the benefits Welsh universities deliver to our economy and our communities.

“What is particularly striking from the report findings is that everyone in the country benefits from the work of our universities, whether they have been to university or not.

“As well as being major employers and businesses in their own right, our universities generate and support jobs within multiple sectors and across the length and breadth of the UK. They also play a crucial role in producing skilled graduates, research breakthroughs and technology advances, alongside creating the spin outs and start-ups that will be at the heart of economic growth in the future.”

The London Economics report also calls out a body of evidence showing the range of wider benefits, to both graduates and society, of a university education. These include increased work productivity for both the graduates and their co-workers, improved health outcomes and a lower chance they will be involved in crime.

Professor Boyle added:

“It is clear that higher education has a key role to play as we tackle some of the major challenges we face as a society. However, this is a critical time for our universities. We must ensure they have the necessary support and investment so that they can continue to drive further economic growth, strengthen the Welsh economy, and create a healthier, wealthier, and fairer society.”