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Janis Magin   |   Staff Writer
February 23, 2023
  • Carl Bonham and Steven Bond-Smith

There is no overstating the University of Hawai‘i’s impact on our state’s economic development, entrepreneurship and innovation. It’s tremendous, not only for Hawai‘i’s economy, but even more for the individuals whose lives are transformed by a college education.

It’s an investment in the present that pays dividends in the future.

UH’s three four-year universities and seven community colleges educate Hawaiʻi’s future leaders and workforce by preparing them for the careers of the 21st century. They plant seeds of innovation and entrepreneurship to address the local and global challenges of the future, preparing the next generation of companies to lead the state into the 22nd century.

Private support expands and enhances the mission to provide broad educational opportunities for all, creating a healthy and thriving future for all who call Hawaiʻi home.

Gifts to UH through the UH Foundation have a direct impact on Hawai‘i’s economy, from scholarships that allow students to attend and stay in school, to groundbreaking research and to attracting talented faculty members, while donors’ legacies endure through endowments. Much bigger is the impact on policy decisions, with UH faculty informing stakeholders and decision makers about a broad array of issues.

“Every one of these gifts has a direct impact on a student getting a degree and raising their lifetime earnings tremendously,” says Carl Bonham, professor of economics at UH Mānoa and executive director of the University of Hawaiʻi Economic Research Organization, which provides economic forecasts and analysis. “If you take the difference that you’re making to that one person’s life, it can be life changing – it can be transformational – and then there are all these spillover effects from that on the broader community.”

UHERO was the recipient of a $1 million endowment from the Hawaii Medical Service Association to establish the HMSA Distinguished Endowed Professorship in Health Economics, a key part of a larger health policy initiative at the College of Social Sciences focused on improving the health care of Hawaiʻi’s people and economy.

HMSA CEO Mark M. Mugiishi, who worked with Bonham on Hawaiʻi’s response to the COVID-19 pandemic, noted that UHERO has been a key player in the state’s economic development efforts.

A recent UHERO report on UH’s economic impact to the state found that the $2.3 billion of UH-related expenditures supported $3.66 billion in sales for local businesses, $1.02 billion in earnings for employees, $186 million in state tax revenue and more than 22,500 jobs.

An investment in the future

At its core, an investment in UH is an investment in people, and the biggest impact of any investment in UH is on future earnings for UH graduates – at least $5 billion for each graduating class.

Bonham explains that a bachelor’s degree boosts earnings by an average of $950,000 over the course of a graduate’s lifetime. Students who earn both bachelor’s and postgraduate degrees, including in medicine, law and business, see an average increase of $1.56 million in earnings over the course of their careers.

Taken as a whole, that means that members of the graduating class each year at UH Mānoa earn an additional $4 billion over their lifetimes. Not only do they improve their own standard of living – that $4 billion is circulated through Hawaiʻi’s economy when they pay taxes, or buy food, or clothing, or a car or a home.

And the increased earnings from a college degree also compound for future generations of families, improving the quality of life for everyone in Hawaiʻi. Students lifted from poverty through education improve their own lives and the lives of their future children through greater access to quality education, better health outcomes and career opportunities.

The businesses created by innovation and entrepreneurship provide jobs to support even more families. The Pacific Asian Center for Entrepreneurship at UH Mānoa’s Shidler College of Business is about to take its work in that area to another level through the Residences for Innovative Student Entrepreneurs, or RISE, an innovation-and entrepreneurship center with 374 beds for student housing opening across the street from the UH Mānoa campus next fall.

“RISE will provide UH students with unique opportunities to develop as innovators and entrepreneurs who will help lead the diversification and strengthening of our economy,” says UH President David Lassner.

More than a dozen individuals, corporate donors and foundations have given more than $4 million so far to the RISE project to furnish and equip the facility, fund programs and provide scholarships to student entrepreneurs. RISE is being built as a public-private partnership, or P3, between UH, UH Foundation and developer Hunt Companies, and will be managed by B.HOM Student Living as UH’s first externally managed student housing complex.

“One of the things with innovation is that, often, these entrepreneurs will only have half of an idea and it’s only when they meet someone else who has a compatible idea that it actually turns into a new business or an actual big idea that’s eventually successful,” says Steven Bond-Smith, an assistant professor at UHERO, explaining that innovation tends to be focused in a handful of cities that attract like-minded entrepreneurs.

“That makes innovation a bit more difficult in Hawaiʻi, so facilities like RISE, by attempting to cluster these people together, will make it easier for them to meet.”

Another gift, from the estate of Clifford and Blanche Hee, achieved that by giving business students at the Shidler College of Business a place to gather and the technology to innovate by turning an outdated computer lab into a state-of-the-art facility named the Tom W.S. Hee Undergraduate Computer Room for their late son.

Innovation and creativity; not merely tuition and books

Scholarships funded by private donors not only play a huge role in an individual student’s success, they support the diversification of Hawai‘i’s economy away from its reliance on tourism.

“There has been some research showing that student loans hold back people from taking risks on starting businesses,” says Bond-Smith. “So you’re less likely to start a business or try to innovate or create a new invention if you have a student loan because you’d rather take a job where you get a steady income to help pay down your student loan.”

Bonham notes that innovation can be found across the university system.

Camille Nelson, dean of the William S. Richardson School of Law at UH, is bringing innovation to legal education with the support of a $1 million gift from UH alumnus Jay H. Shidler to launch the Dean’s Innovation Fund.

“Whenever there are vanguard type questions, lawyers ought to be involved in the problem solving,” Nelson says. “While we don’t think of law schools as hubs or labs for innovation, lawyers have to be creative, increasingly entrepreneurial, and innovative to meet the challenges of the future.”

Other parts of the university are more directly focused on innovation.

“Engineering, astronomy, are incredibly innovative,” Bonham says. “They’re building their own tools. They’re inventing new ways to do things. They’re setting the foundation for future innovation.”

If you would like to learn how you can support UH students and programs like this, please contact us at 808 376-7800 or send us a message.