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Durham University News

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Leading research-focused universities worth £87 billion to UK economy

(2 November 2017)

The UK’s leading research-focused universities, including Durham, are worth nearly £87 billion a year to the national economy, a major new study has revealed.

The total contribution of the 24 Russell Group universities, of which Durham is one, equates to eight months’ UK-wide expenditure on the NHS.

The £86.8 billion figure is contained in a new study on the short, medium and longer-term impact of Russell Group universities by the respected economic research consultancy, London Economics. Its authors have undertaken the most comprehensive and detailed analysis to date of the group’s combined net contribution by calculating the impact of their teaching and learning activities, their world-renowned research, their spending on goods, services and people, and their value as a major exporter through the income generated from overseas students.

Durham University: So Much More

The London Economics report follows a major study undertaken by BiGGAR Economics which found that Durham University generated £1.1 billion Gross Value Added (GVA) for the UK economy in 2014/15, and supported 13,600 jobs.

Professor Stuart Corbridge, Vice-Chancellor at Durham University, said: “Here at Durham University we are proud of the positive contribution we make to the UK, the North East of England, Durham City and Stockton-on-Tees.

“This independent report provides compelling evidence that we and other research-intensive universities are critical to the future prosperity of the UK. Added to what we already know about Durham University’s economic, cultural, social and research contribution, it again demonstrates that we are so much more than the sum of our parts.”

The total economic impact calculations in the London Economics are based on a snapshot of a single academic year, 2015/16.

Among the key findings are:

Teaching and Learning

  • The 166,000 UK-domiciled students who began their studies at Russell Group universities in 2015/16 will go on to contribute £20.7 billion to the UK economy over their working lives through their enhanced skills, productivity and earnings;
  • More than half of this contribution (52%) will be in the form of additional tax and National Insurance receipts to the Exchequer to fund vital public services. The remaining contribution will be accrued by the graduates themselves in the form of their enhanced spending power after tax and student loan repayments.

Research and Knowledge Transfer

  • Research carried out at Russell Group universities in 2015/16 will contribute £34.1 billion to the UK economy;
  • This figure is based on the net direct impact of research activities by Russell Group institutions in that year combined with informed estimates of how this research will help the private sector become more productive through developing cutting-edge technologies and better ways of doing business;
  • For every £1 of public research funding they secure, Russell Group universities deliver an average return of £9 to the UK economy.

Educational exports

  • The immediate export value to the UK in the form of net tuition fee and other studies-related income from the 100,000 EU and non-EU students enrolling on courses at Russell Group universities in 2015/16 is £4.8 billion;
  • Every seven non-UK students embarking on an undergraduate degree at a Russell Group university will generate £1 million for the UK economy.

The direct, indirect and induced impact of Russell Group universities to the local, regional and national economy

  • Russell Group universities support a total of 261,000 full-time equivalent jobs – more than the entire population of cities like Aberdeen and Plymouth. 153,000 of these jobs are supported through direct employment and a further 108,000 supported indirectly through the expenditure of the universities, their staff and international students;
  • The overall economic impact of spending by the 24 universities in 2015/16 together with the spending of their staff, their suppliers and their international students in the wider economy was £27.2 billion.

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