Office of the Vice President for Global Communications

Thursday, October 7, 2010

URC’s students, R&D, partnerships key to state’s resurgence

As the state and U.S. economies sank, Michigan’s University Research Corridor grew in areas critical to the state’s resurgence: Educating more students and boosting research and technology gains, according to a new benchmark study.

The 2010 Empowering Michigan report shows URC partners U-M, Michigan State University and Wayne State University have improved in several key benchmarks since the first study in 2007. The study, comparing Michigan’s URC with leading innovation clusters around the world, was conducted by Anderson Economic Group (AEG), building on data collected during the past three years.

 

Read the full 2010 Empowering Michigan report.

“The URC has been a bright spot in the state’s economic picture, even in the teeth of the recession. Michigan has the third-fastest research and development growth rate among competitive innovation clusters,” says URC Executive Director Jeff Mason. “Just as importantly, we’re getting stronger relative to the competition, which puts us in a good position to help propel the state’s economic growth in the future.”

Patrick Anderson, founder and principal of AEG, adds, “Even as state support has dropped, Michigan’s research universities remain the No. 1 cluster in the U.S. in terms of enrollment, and No. 3 in terms of high-tech degrees. These universities provide a net benefit to the state that is 16 times the cost to taxpayers. This gives Michigan the talented work force we need for the jobs of tomorrow.”

The study also found the URC:

• Growing. It is serving more students than any other comparable innovation cluster, adding 5,517 extra student slots since 2006 for a total of 137,152 (77 percent from Michigan, 14 percent from other states and 9 percent from more than 100 other countries). That includes 7,857 students who graduated in 2009 with degrees in high-tech disciplines crucial to a knowledge-based economy.

• Serving all of Michigan. The URC enlarged its economic impact on Michigan from $12.9 billion in 2006 to $14.8 billion in 2009. There were more than 550,000 URC alumni living in Michigan and earning $26 billion in 2009, which is 7.2 percent of Michigan’s adult population.

• Returning revenue. It generated $401 million in 2009 state tax revenue (up $50 million from 2006) even as state support for higher education declined). That figure is close to half the amount of the total state appropriations of $888 million the state appropriated to the three research universities that year.

• National impact. It was one of seven innovation clusters in six U.S. states that together accounted for 22 percent of R&D investments made by all U.S. higher education institutions. The URC expended more than $1.48 billion in R&D, up $113 million over 2006.

• Innovation leader. Innovation clusters are regions with a high density of high-tech industries and innovation, typically measured by patent applications, business licensing revenue and related high tech assets. Over the past five years, the URC was among the top three clusters for generating patents (136) and has generated twice as much licensing revenue than the more commonly recognized Research Triangle cluster comprised of Duke, North Carolina, and North Carolina state.

• International leader. This year’s report compares the URC with comparable international innovation clusters, finding the URC doing far more research than comparable clusters in Japan and Israel while trailing Great Britain’s primary innovation cluster.

U-M President Mary Sue Coleman says, “A recent headline from the San Francisco Business Times really said it all, ‘California’s Innovation Model… Michigan?’ For four years, we’ve worked to change attitudes about the impact of innovation on whole regions and the evidence shows the word is getting out.’’

Allan Gilmour, a former Ford Motor Co. vice chairman and chief financial officer who recently became interim president of Wayne State, says the report and the URC’s new Accelerate Michigan partnership with Business Leaders of Michigan highlight the impact of having universities and business moving forward in tandem.

“Business and universities are both part of the solution to our economic challenges,” Gilmour says. “It’s the combined power that can really make a difference.’’

MSU President Lou Anna Simon notes: “‘We’re working diligently and creatively to make university resources accessible to entrepreneurs and businesses, large and small. U-M’s Business Engagement Center, Wayne State’s The Front Door and MSU’s Business Connect are one-stop shops connecting universities to business need. This report reflects the impact of those efforts in addition to growth in other benchmark areas.”

The report measures the URC universities against six comparable U.S. clusters in regions known as knowledge economy leaders:

• Boston’s 128 Corridor: Harvard University / Massachusetts Institute of Technology (MIT) and Tufts University.

• Silicon Valley/Northern California: Stanford University, University of California, Berkley, and UC, San Francisco.

• The Research Triangle: University of North Carolina, Duke University and North Carolina State University.

• Chicago/Illinois: University of Chicago, Northwestern University and University of Illinois at Urbana-Champaign.

• Southern California: UCLA, University of Southern California and UC-San Diego.

• Pennsylvania: Penn State University (all campuses), University of Pittsburgh and Carnegie Mellon University.

This year’s report also introduced new comparisons with leading international innovation clusters, initially looking at peer innovation clusters in Great Britain, Israel and Japan — areas with highly ranked universities that also include R&D hubs.

“The URC universities are a tremendous presence in Michigan’s economy,’’ says Caroline Sallee, lead author of the study and director of AEG’s Public Policy, Fiscal, and Economic Analysis practice area.

“They continue to be drivers of economic growth and innovation, providing the technical foundation that gives rise to an average of 14 new startup companies each year. These globally competitive research institutions spent $1.5 billion on R&D in 2008, significantly more than the top universities in research-intensive countries like Japan and Israel.”