(gentle discovery music)
- Main Street
in Pullman, Washington,
home to Washington State University,
shows a glimpse of college town life
leading into this semester.
In a typical fall,
the town population
swells to about 35,000,
as more than 20,000
students report for class.
But this semester, the
on-campus residence halls
and apartments will be virtually empty,
and the more than 30,000 seats
in Martin Stadium will be, too.
It's not just Pullman.
One study says, as of mid-August,
the coronavirus has pushed
nearly half of US
colleges and universities
into some degree of remote learning.
That could mean fewer students
and visitors in college towns,
which could lead to lower
sales for restaurants,
gas stations, and hotels.
That's sending shockwaves
through the economies
of many college towns.
(mysterious classical music)
In Pullman, Washington,
WSU dominates the landscape
and the economy.
Anna Brown, an economist at EMSI,
creates models of spending
patterns in college towns.
- So when we look at these analyses,
what we wanna look at
is the new economic
activity created in a town
or in a region as a result
of the universities.
So the operation spending
impact is what we call it,
tends to be one of the largest impacts,
and we especially see
that with WSU in Pullman.
- [Narrator] Brown's model says
that the university's day-to-day spending
brought $779 million
into Pullman's economy
in a recent fiscal year.
That includes spending on staff payrolls,
equipment purchases, and food,
and then how that spending
ripples through the local economy.
The school's budget comes
from a few revenue streams,
including enrollments and public funding.
Both are expected to be down,
in part due to the coronavirus.
Washington State is
asking public universities
to plan for a 15%
reduction in state funding
for the 2021 fiscal year.
WSU's financial officer said
that the budget cut for the school
is roughly equal to the cost
to run the Colleges of
Business, Communication,
and Education combined.
Similar losses could happen
elsewhere in the country.
In California, public colleges face
$602 million in reductions.
The State of Maryland
imposed 8% in cuts on higher education,
which may reduce university
spending as well.
Enrollment could stall or
even be down at some schools,
potentially hurting school budgets
and interrupting spending
on college town communities.
In the Northeast, the enrollment dip
could cause some schools
to shutter all together.
19 cities and towns in New England
have economies that rely on
financially vulnerable colleges,
according to an analysis
from the Federal Reserve Bank of Boston.
(gentle discovery music)
The financial health
of a college town
depends on university spending.
But student activity plays
an important role, too.
EMSI's analysis of Pullman
says student spending had an impact
of $48.5 million last year.
And that's equivalent to
about 1,200 local jobs.
- And this includes the
spending that students spend
for their room and board,
particularly for off-campus students,
as well as for their day-to-day expenses
as they're going to local restaurants,
as they're spending money
on gas and so forth,
all of that is considered
within the student spending impact.
And really what we're focusing in on there
are students who are relocating to Pullman
or students who stay in
Pullman because of WSU.
- [Narrator] If students stay away,
Pullman businesses will see fewer sales,
and the city government
will see less tax revenues.
But the city administrator of Pullman
says that at least some students
are returning to their
off-campus apartments.
Their activity could help offset
the impact of budget cuts.
- In conversations with the university,
they're planning currently
for about 70% of the students to return.
And the students are such a
huge impact on our community.
They're residents most of
the time of the year as well,
so any time they're
going out and spending,
that means a big impact.
- [Narrator] Other schools are
working with local businesses
to welcome students back.
That could alleviate some
of the economic pain.
Virginia Tech is welcoming
students back to Blacksburg,
but off-campus students can't
by on-campus meal plans.
That could divert more spending
towards local restaurants and grocers.
Back out west, Moscow, Idaho
is welcoming 12,000 students
to attend the University of Idaho.
Their campus is 10 miles away from WSU.
That could draw more
students into the region,
helping mitigate some
of the economic damage.
But the loss of fall sports
could significantly
reduce visitor spending.
(gentle music)
In Pullman, visitors brought
$17.3 million into the local economy
in a recent fiscal year.
- During big football events,
there are a lot of Cougar fans
who live in the Seattle area,
and so they are coming
from Seattle every weekend
or every home game weekend
to watch the football game.
And so then they're bringing
that money with them
that's creating the economic impact
by spending locally,
and it's money that would
not have otherwise been spent
if not for the university home games
or other events such as
graduation or Mom's Weekend
and those types of events.
- [Narrator] But this spring,
as the country sheltered in place,
events were called off.
Craig Depken, a professor of economics
at the University of North
Carolina at Charlotte,
says that game day spending from visitors
will be missed most in the
smallest college towns.
- I'd say in a town like
Prairie View, Texas,
which has about 5,600
people, something like that,
roughly around 6,000 people in the town.
That's a small town, the
economy's not gonna be very huge.
It'll have its fast food restaurants
and it'll have its gas stations.
Then you look at the football stadium
at Prairie View A&M.
If that stadium is full,
it has more people in the stadium
than live in the entire town.
- [Narrator] One of his studies found
that in smaller college towns,
games can promote economic growth.
But Prairie View A&M's
athletics conference
postponed fall sports.
Some of the biggest
conferences are following suit.
(gentle piano music)
Washington State University's
PAC-12 conference
postponed fall athletics,
as did the Big Ten.
With football season postponed,
college towns like Pullman
may see a reduction in spending,
as they could from their
other two main sources.
Spending in college towns
will be down this fall.
The expected slowdown in activity
could eliminate vital jobs.
As fall approaches,
economists are watching.
