The Role of Higher Education in Strengthening the State and Local Economy

Higher education is more than a pathway to individual achievement—it’s a cornerstone of Pennsylvania’s economic vitality. As a national leader in attracting top-tier students and producing cutting-edge research, Pennsylvania’s universities and colleges play a crucial role in shaping the workforce, driving innovation, and supporting the state’s economy.

Pennsylvania: A Top Destination for Students Nationwide

When it comes to attracting talent, Pennsylvania is ahead of most states. Ranked #2 in the nation as a destination for out-of-state first-year college students, Pennsylvania is quickly becoming a national hub for students seeking both academic excellence and professional growth opportunities. This influx of students bolsters local economies, supports small businesses, and builds a talent pool essential for industries across the state.

The quantity and diversity of Pennsylvania’s higher education institutions are critical factors in achieving this inpouring of students. The state hosts the fourth-highest number of higher education institutions in the nation, including major research universities, liberal arts colleges, and technical schools, all contributing to a vibrant educational landscape. Together, these institutions attract thousands of students and professionals, bringing unique skills and perspectives that enhance the state’s workforce.

Excellence in Education: Pennsylvania’s High-Caliber Institutions

Beyond sheer volume, Pennsylvania’s colleges and universities rank among the best in the nation. The Wall Street Journal recently ranked Pennsylvania #3 in the country for the number of top-performing colleges. Local institutions, such as Dickinson College and Messiah University in Cumberland County, are among these high-ranking schools, attracting students who contribute significantly to the local economy and labor market.

“Messiah University is proud to serve its local economies by bringing students and visitors, and their spending power, into the region,” says Associate Vice President for Marketing and Communications Carla Gross. “Messiah students and campus visitors frequent local businesses in important sectors like food, retail, and entertainment. Messiah’s residential graduate programs, such as physical therapy, occupational therapy and athletic training, also bring students to live, eat and shop in the region for extended periods of time while they complete their degrees. The university additionally attracts thousands of out-of-state visitors each year for events like commencement, family and homecoming weekends, and prospective student visits and events, all of which support the local hospitality industry.”

Pennsylvania’s legacy of educational excellence is evident globally, with alums from institutions like the University of Pennsylvania going on to found industry-leading companies and achieving prominent positions worldwide. Notably, UPenn boasts the highest number of billionaire alumni globally, underscoring the state’s reputation for cultivating top business and tech leaders.

Additionally, 16% of American Nobel Prize winners were or are affiliated with an AICUP college in Pennsylvania.

Economic Impact of Higher Education in Cumberland County

The influence of higher education institutions on Pennsylvania’s economy is substantial. According to an independent study by the Association of Independent Colleges and Universities of Pennsylvania (AICUP), the sector contributes $24 billion annually to the state’s economy. This economic engine sustains one in every 32 jobs in Pennsylvania, spanning fields as varied as healthcare, education, and technology.

In Cumberland County, the presence of institutions like Messiah University plays an essential role in addressing workforce needs. For example, Messiah’s initiatives to tackle the nursing shortage directly respond to one of the state’s most pressing workforce challenges. This impact goes beyond a simple economic contribution—it improves local healthcare capacity and enhances community well-being, showcasing the value of investing in local higher education.

Carla Gross notes, “Messiah is intentional and strategic in forming workforce development partnerships with school districts and employers in our state and region to prepare high-quality graduates for in-demand fields experiencing urgent shortages such as nurses and teachers—both at the graduate and undergraduate levels. We view these types of partnerships as critical to enhancing the common good and quality of life in Cumberland County, Pennsylvania, and beyond. “

Workforce Development and Innovation

Pennsylvania’s institutions are adept at aligning educational programs with high-demand industries, including STEM, healthcare, and public service. With an increase in students pursuing degrees in these areas, the state can support essential sectors more effectively. Approximately 55% of Pennsylvania’s STEM graduates and 69% of its nursing degrees come from AICUP-affiliated institutions. These students are prepared for critical roles that meet today’s workforce demands, helping to strengthen the foundation of Pennsylvania’s economy.

In addition to workforce training, Pennsylvania’s educational institutions foster a culture of innovation. Alumni from Pennsylvania schools have invented and contributed to technologies that impact millions of lives daily, from WiFi to the Java programming language. These achievements illustrate the state’s commitment to producing graduates who contribute not just to the economy but to society at large.

Higher Education as a Driver of Long-Term Economic Growth

Beyond its immediate economic impact, higher education in Pennsylvania creates long-term value by building a skilled, diverse, and resilient workforce. As Pennsylvania sees a 51% increase in net gains of college-educated residents, it becomes evident that the state’s institutions are not only attracting but retaining talent. This “brain gain” effect counters the narrative of population loss and provides a steady stream of educated professionals who can fill high-skill roles, stimulate innovation, and support economic growth.

The impact is especially notable in Cumberland County, where local colleges and universities work closely with businesses and industries to ensure graduates are equipped with relevant, in-demand skills. This alignment between higher education and workforce needs positions Cumberland County as a model for economic resilience and adaptability, ensuring the local economy can thrive in a rapidly changing job market.

Higher Education: One of PA’s Most Valuable Resources

Pennsylvania’s higher education institutions are shaping the futures of individual students and creating a robust foundation for economic growth and innovation. They represent a vital investment in the state’s economic future, with a strong track record of attracting talent, fostering innovation, and meeting workforce needs.

As Pennsylvania continues to draw top students and produce world-changing research, it becomes clear that higher education is one of the state’s most valuable resources. By supporting these institutions, policymakers and community leaders can help ensure that Pennsylvania remains a competitive, thriving place to live, work, and learn for future generations.

Note: This information was provided by the Association of Independent Colleges and Universities of Pennsylvania (AICUP), a statewide organization that exclusively serves the interests of independent nonprofit higher education within the Commonwealth.