The state government general fund shortfall in the current fiscal year is projected to be between about $550 million and $1 billion. This shortfall will need to be eliminated through spending cuts and/or revenue enhancements. The Legislature has demonstrated a preference for spending cuts. However demand does not decline during a recession for most public-sector services, including university services. Any reduction in funding for universities will have a negative and direct effect. A reduction in state government spending for universities of around $200 million would cause direct and indirect job losses of approximately 4,000. A substantial decrease in state government funding for universities will have negative consequences beyond these short-term effects.
- The Economic Contributions of the University System: A Report From the Office of the University Economist
Summary of the effects of a reduction in university funding and the delay of the construction stimulus program -- Short-term effects of a reduction in university funding of $200 million -- Short-term effects of delaying the construction stimulus program -- Long-term effects of a funding reduction for universities.
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Hill, Kent, Dennis Hoffman, Tom Rex. The Economic Contributions of the University System: A Report from the Office of the University Economist (Tempe, Arizona: Arizona State University, 2008)