NU study boasts $6.4 billion in annual economic impact to state

LINCOLN — Battered by potential financial cuts on both the state and federal levels, the University of Nebraska on Tuesday released a new study touting its value: a reported $6.4 billion economic impact last fiscal year.

National consultant Paul Umbach said his analysis showed a $2.4 billion impact in direct spending by the NU system and another $4 billion generated through re-spending by vendors, staff, students and visitors.

Commissioned by the university, the report says that for every $1 of investment, $10 is returned to the state. 

It says one of every seven working Nebraskans was educated by the state’s only public research university — a system of campuses in Lincoln, Omaha, Kearney as well as the Omaha-based University of Nebraska Medical Center.

NU President Dr. Jeffrey Gold, a former UNMC chancellor, called the message “very simple” at a news conference at Hudl headquarters in downtown Lincoln.

“The value proposition of the University of Nebraska is huge and continues to grow,” he told a group that included Nebraska lawmakers, Lincoln’s mayor, NU regents and chancellors. “This university changes lives, saves lives, enhances lives literally on a daily and an hourly basis.”

However, the mood of the event — planned prior to recently announced federal financial hits to research funding, including in Nebraska — turned somber at times as speakers pondered what lurked ahead. 

Gold said his team has been busy reaching out to advocacy groups and policymakers to better understand the implications to form the best response to what he said could be as much as $60 million less than anticipated in public funding for next year. He said NU also faces another roughly $30 million in potential inflationary costs.

“The lack of understanding of the short- and long-term impact is extremely disappointing,” Gold said. “If you don’t understand the motivation for it, it’s very difficult to assuage those that have these concerns.”

He said his team is building multiple scenarios to address changes — while “at the same time trying to maintain the esprit de corps and the energy around the future of the University of Nebraska.” 

Umbach, founder of Tripp Umbach consulting, said cuts to research would be “devastating” to the state’s economy, sending negative ripple effects to health care, jobs and alumni opportunities. He foresees potential harm to rural areas, as NU has worked to ensure the presence of health care professionals in communities across the state.

“What happens when researchers stop doing the research they’re doing?” Umbach asked.

He said American global competitiveness is driven by the U.S. position as a leader in research. “And now our competitiveness in cancer research, in ag research, natural environment research is at risk, and other folks will take that and run with it.”

Heightened concern comes on the heels of a National Institutes of Health weekend announcement that would effectively cap “indirect funds” for overhead costs such as buildings, utilities and administrative staff at 15% of the total of each award.

A federal judge has ordered the Trump administration to hold off on the plan that the New York Times reports would cut $4 billion in federal funding for research at the nation’s universities, cancer centers and research hospitals.

Gold said the NIH reduction would require NU to absorb more than $27 million to sustain its current research and facilities. 

In addition, he cited “dozens” of executive orders and other federal directives, some of which may have an impact on the NU system.

Gold said he never anticipated such moves when he assumed the presidency of the NU system seven months ago and said he would strive to maintain operations and not compromise service.

“In Nebraska, when the going gets tough, the tough get going,” he said. “We’ve got this.”

State cuts to the university system reflect Gov. Jim Pillen’s efforts to address a $432 million projected state budget shortfall over the next two years. 

According to NU, that could translate to a $14.5 million reduction in the university system’s core budget. In addition, NU’s $11 million share of the state tobacco settlement biomedical research fund also would be removed, though the university still is mandated by statute to maintain $6.25 million (and growing) in annual tuition waivers.

On top of that, Gold said, the university is facing up to $30 million in inflationary costs. He said NU and its advocates continue to talk to Nebraska lawmakers to advocate for the 3.5% increase in state funding NU sought for each of the next two years.

Tuesday’s news conference was held at Hudl, a worldwide sports video and technology company that launched in Lincoln, to highlight the talent the university delivers to the state and beyond.

Brian Kaiser, the company’s co-founder who went to the University of Nebraska-Lincoln’s Jeffrey S. Raikes School of Computer Science and Management, said he owed much of his and the company success to NU, and said it continues to be a pipeline for Hudl professionals.

Sierra Futterman, a software engineer and UNL graduate, told the group how she came from California and after an internship with Hudl never left. Her brother, UNL educated as well, also took a job in Lincoln, and eventually her parents followed.

“It shaped my career,” she said of the Hudl design studio. 

According to the Umbach report, more than 100,000 NU alumni are employed in the state. Their wages collectively increased 20% from $2.9 billion in 2021 to $3.5 billion in 2024.

In 2024, more than 11,000 students graduated from an NU campus. Of those, the consultant report projected that 7,000 graduates who remain in the state will earn $258 million in wages.

The Umbach analysis said that NU’s total economic impact in about a decade has risen 64%, from $3.9 billion in 2015. By comparison, Nebraska’s gross domestic product during that time frame increased 24%, from $116.5 billion to $144.9 billion.

“The NU system’s growth rate has nearly tripled the rate of the state’s economy over the past nine years,” the study said.

Other highlights of the study showed that the NU system:

• Employs 29,129 people including faculty, staff and student employees who get their paycheck from the university. Those jobs support 23,206 other jobs in sectors such as construction, restaurants, information technology and security, for a total employment impact of 52,335 full- and part-time jobs. Translation, according to Umbach, is that the NU system directly or indirectly employs one in 17 Nebraskans. 
• In nearly a decade, the NU system grew from supporting 35,329 total Nebraska jobs in 2015 to the 52,335 today, representing 48% growth. That rate reportedly represents more than 10 times the statewide job growth of 4.5% over the same period.
• For UNMC, the overall economic impact of its operations on the state in fiscal year 2024 totaled $1.6 billion ($620 million direct and $1 billion in indirect impacts). UNMC supported 6,265 direct jobs and 7,185 indirect and induced jobs across Nebraska. 
• Nebraska Medicine, UNMC’s private clinic and hospital partner, had a reported $5.5 billion in total economic impact; 9,497 direct jobs, 34,383 indirect jobs and $189 million generated in local and state taxes. 
• Umbach said NU operations generated $175 million in state and local tax revenue, primarily by employees, students and visitors, but also by companies and vendors who do business with the university and pay local and state taxes.