New research shows higher education sector creates £3.6bn annually in the Welsh economy

New research released today, from leading higher education experts has found that Welsh universities have an impact of almost £2.6bn on the nation's economy, with this figure reaching £3.6bn once total off-campus spending by students is taken into account.

The independent report commissioned by Higher Education Wales and conducted by Viewforth Consulting, shows the higher education sector is one of Wales' most valuable industries by creating tens of thousands of jobs, generating some 3% of the nation's GDP while earning over £400m in much-needed export earnings through overseas revenue and international students coming to study in Wales.

The study published during Welsh Universities – Driving Growth week, a campaign highlighting the sector's importance to the Welsh economy, concludes that off-campus spending by students at Welsh universities contributes more than £1bn to the economy annually, while almost 3% of the Welsh workforce is in employment generated by universities. Although the sector directly employs some 16,241 full time members of staff, after taking into account the "knock-on" effects of jobs being created in other industries linked to Welsh universities, it is believed the total employment generated is just under 39,000. With jobs across a wide spectrum of occupations, including a range of skilled and semi-skilled jobs, these figures show how the sector's future is inextricably linked with Wales' future economic vitality.

Co-author of the research, Ursula Kelly of Viewforth Consulting said: "The findings of the report highlight the crucial role Welsh universities have in powering the Welsh economy. We've used the most recent version of the Universities UK economic impact modelling system to ensure the figures are as accurate and robust as can possibly be, and the results show how the higher education sector is a major economic factor and industry in itself by generating economic output, jobs, GDP and supporting communities across the country."

Professor John Hughes, Vice-Chancellor of Bangor University and Chair of Higher Education Wales, said: "While it has always been apparent our universities are of considerable importance to Wales in supporting economic development through education and research, these figures show just how vital a contribution universities make to their local communities, and the wider Welsh economy, through supporting thousands of 'knock-on' jobs outside of campuses.

"The report demonstrates that for every £1m of Welsh higher education institutional revenue, a further £1.03m is generated to the Welsh economy. If you add these findings to the positive results for Wales in the recent Higher Education – Business and Community Interaction Survey, which showed Welsh universities significantly 'punching above their weight' in their contribution to the economy, you get a picture of a sector that is ideally placed to drive future economic growth in a bid to create a more prosperous Wales."

Commenting on today's publication the Minister for Education and Skills, Leighton Andrews, said: "Our Universities are integral to driving the economy in Wales, supporting industry, research and innovation and generating employment. These significant figures released today highlight the importance of the HE sector to Wales as a whole and we, as a Government, are doing all we can to support and strengthen the sector to ensure its long term success and sustainability."

The study was compiled using the most recent version of the Universities UK economic impact modelling system, where the key economic features of the higher education sector in Wales were examined during the financial year 2011-12, together with those aspects of its contribution to the economy that can be readily measured, to create a report that is the most accurate and up-to-date examination of the quantifiable contribution universities make to the Welsh economy.

Under the umbrella of Higher Education Wales, each institution has come together as part of a week of activity to highlight the sector's importance to the nation's economic development, as well as drawing public attention to the way our universities benefit Wales as a whole – economically, socially and culturally.