The Economic Value of Luna Community College

LUNA COMMUNITY COLLEGE (Luna) creates value in many ways. The college plays a key role in helping students increase their employability and achieve their individual potential. The college draws students to the region, generating new dollars and opportunities for the Luna Service Region.* Luna provides students with the education, training, and skills they need to have fulfilling and prosperous careers. Furthermore, Luna is a place for students to meet new people, increase their self-confidence, and promote their overall health and well-being.

Luna influences both the lives of its students and the regional economy. The college supports a variety of industries in the Luna Service Region, serves regional businesses, and benefits society as a whole in New Mexico from an expanded economy and improved quality of life. Additionally, the benefits created by Luna extend to the state and local government through increased tax revenues and public sector savings.

This study measures the economic impacts created by Luna on the business community and the benefits the college generates in return for the investments made by its key stakeholder groups—students, taxpayers, and society. The following two analyses are presented:

Investment analysis

All results reflect employee, student, and financial data, provided by the college, for fiscal year (FY) 2021-22. Impacts on the Luna Service Region economy are reported under the economic impact analysis and are measured in terms of added income. The returns on investment to students, taxpayers, and society in New Mexico are reported under the investment analysis.

*For the purposes of this analysis, the Luna Service Region is comprised of Colfax, Guadalupe, Mora, and San Miguel Counties.

Economic impact analysis

Luna promotes economic growth in the Luna Service Region through its direct expenditures and the resulting expenditures of students and regional businesses. The college
serves as an employer and buyer of goods and services for its day-to-day operations. The college’s activities attract students from outside the Luna Service Region, whose
expenditures benefit regional vendors. In addition, Luna is one of the primary sources of higher education to the Luna Service Region residents and a supplier of trained workers to regional industries, enhancing overall productivity in the regional workforce.

Operations spending impact

Luna adds economic value to the Luna Service Region as an employer of regional residents and a large-scale buyer of goods and services. In FY 2021-22, the college employed 161 full-time and part-time faculty and staff, 88% of whom lived in the Luna Service Region. Total payroll at Luna was $11.1 million, much of which was spent in the region for groceries, mortgage and rent payments, dining out, and other household expenses. In addition, the college spent $10.2 million on day-to-day expenses related to facilities, supplies, and professional services.

Luna’s day-to-day operations spending added $12.8 million in income to the region during the analysis year. This figure represents the college’s payroll, the multiplier effects
generated by the in-region spending of the college and its employees, and a downward adjustment to account for funding that the college received from regional sources. The $12.8 million in added income is equivalent to supporting 177 jobs in the region.

Student spending impact

Around 14% of students attending Luna originated from outside the region in FY 2021-22, and some of these students relocated to the Luna Service Region to attend Luna.** These students may not have come to the region if the college did not exist. In addition, some in-region students, referred to as retained students, would have left the Luna Service Region if not for the existence of Luna. While attending the college, these relocated and retained students spent money on groceries, accommodation, transportation, and other household expenses. This spending generated $489.2 thousand in added income for the regional economy in FY 2021-22, which supported 10 jobs in the Luna Service Region.

**Due to data limitations, the percentage of out-of-region students relocating into the Luna Service Region and living off campus is estimated using information provided by other New Mexico institutions.

Alumni impact

The education and training Luna provides for regional residents has the greatest impact. Since the establishment of the college, students have studied at Luna and entered the regional workforce with greater knowledge and new skills. Today, thousands of former Luna students are employed in the Luna Service Region. As a result of their education from Luna, the students receive higher earnings and increase the productivity of the businesses that employ them. In FY 2021-22, Luna alumni generated $23.2 million in added income for the regional economy, which is equivalent to supporting 379 jobs.

Total impact

Luna added $36.4 million in income to the Luna Service Region economy during the analysis year, equal to the sum of the operations spending impact, the student spending impact, and the alumni impact. For context, the $36.4 million impact was equal to approximately 2.4% of the total gross regional product (GRP) of the Luna Service Region. This contribution that the college provided on its own is as large as the entire Real Estate & Rental & Leasing industry in the region.

Luna’s total impact can also be expressed in terms of jobs supported. The $36.4 million impact supported 565 regional jobs, using the jobs-to-sales ratios specific to each industry in the region. This means that one out of every 37 jobs in the Luna Service Region is supported by the activities of Luna and its students. In addition, the $36.4 million, or 565 supported jobs, stemmed from different industry sectors. For instance, among non-education industry sectors, the spending of Luna and its students and the activities of its alumni in the Health Care & Social Assistance industry sector supported 85 jobs in FY 2021-22. If the college did not exist, these impacts would not have been generated in the Luna Service Region.