Sonoma State University’s economic connection to the community

The economic impacts of Sonoma State University (SSU) are broad and deep on both the North Bay economy and the state of California.

Our annual operations tell one story; our alumni tell another. The connected story told is about our students and social mobility.

Completed in 2021, the California State University (CSU) Chancellor’s Office commissioned a consultancy called ICF to estimate the economic impacts of all 23 campuses and the headquarters in Long Beach on the California economy.

SSU’s economic impacts affect Sonoma County and the North Bay economy within the Bay Area region as defined in ICF’s report. SSU’s economic impacts come from spending on and off campus, including the estimated wages of faculty and staff and also how our students spend on their activities while living on or close to campus.

Approximately 1,100 full-time equivalent workers come to SSU weekly. Economic impacts describe a “ripple” effect of one event or industry for a defined area. Like throwing a stone in a still pond, the jobs and spending on SSU’s campus ripple out into the Sonoma County economy to support more jobs, business revenues, and tax receipts at all levels of government. Hundreds of industries and thousands of businesses are supported, which also supports thousands of workers.

Some highlights of the 2021 study include:

• For every $1 million spent on campus for operations, another $625,000 is spent on other businesses throughout Sonoma County.
• For every $1 million spent on campus, $53,100 in state and local tax revenues are generated including new property taxes paid by faculty and staff living in Sonoma County, and an array of taxes and fees paid otherwise by SSU’s employees and students.
• For every $1 million dollar spent on SSU’s campus, approximately 13 workers in Sonoma County are supported.

The pandemic left a shadow over Sonoma County’s economy. As of late 2022, there are some businesses that have not hired back the same volume of workers as before the pandemic, which reduces the ripple effects of SSU’s operations and student spending.

Further, the pandemic reduced SSU’s spending levels and students on campus. Both changes also reduced the total economic impact, but not the multiplier effects of new dollars spent or provided from public, private or non-profits sources as new budget, new gifts or new grants.

These are investments in SSU’s growth and in the surrounding communities as the pandemic’s effects continue to fade SSU’s operations and student spending create revenues for regional businesses, whose workers are paid from these revenues and then spent on other merchants and businesses, whose workers spend on other businesses, and so on.

The total spending that begins with SSU’s operations becomes additional, regional output or impact. SSU’s economic effects are going to be almost all in Sonoma County due to SSU’s location. For example, when Sonoma State University uses $214 million in campus expenditures, SSU creates another $133.8 million in business revenue, supports another 1,574 jobs and $103.3 million in wages paid. Tax receipts include $11.37 million at the state and local level.

Sonoma State’s alumni expand SSU’s broad impacts on the regional and state economies. Higher education makes more economically-productive residents – creating a foundation for social mobility – as these educated residents contribute to the California economy through wages paid and spent and how they add value to their employers.

When alumni live and work in Sonoma County, SSU’s positive economic impact is enhanced. Because the alumni’s degrees provide augmented economic potential versus not having a college degree for our graduates, their education and subsequent jobs and earnings in California increase the positive economic impacts of SSU’s annual operations.

The synergistic effects of SSU’s positive economic impact are important not only to the North Bay, but to the state, the country, and the globe, as our alumni reside on all continents. In all, SSU generated $6.97 in economic activity for every dollar spent on campus or by students or alumni in Sonoma County, a return of almost seven times the initial investment.

While placing a monetary value on social mobility is tricky, it is important to remember that this spending also supports local schools, local community organizations, kids’ sports, places of worship, and the general quality of life.

This investment in the life of our community – in all of our communities – is at the heart of Sonoma State University’s mission. Our ability to achieve these positive impacts relies in large part on our partnerships with local businesses, civic organizations, community leaders, and stakeholders in general.

We appreciate the work that goes in to building and sustaining these collaborative relationships, and look forward to another year achieving positive economic impacts in pursuit of the public good.