Updated FHTCC Study Shows Increases in Jobs, ROI and Annual Economic Output of $360 Million
HEATHROW, Fla. (February 22, 2012) – A recently updated study of the University of Central Florida’s Business Incubation Program (UCFBIP) demonstrates the program’s impact on the regional economy, showing a total economic output from client and graduate companies that exceeds $360 million annually. Since 2009 when the Florida High Tech Corridor Council originally commissioned a similar study, the UCF Business Incubation Program has grown to include five new facilities around the region which have produced additional jobs and increased the level of employee earnings.
“In the past two years – 2009 through mid-2011 – in the midst of the most severe national and statewide economic downturn in decades, the UCF Business Incubation Program has proven instrumental in the creation of almost 1,500 new jobs with earnings in excess of $62 million annually in the Metropolitan Orlando region,” reported William H. Owen, CRE, president and CEO of the research firm that conducted the study, WHOwen Consulting.
The updated analysis of UCF’s Business Incubation Program also shows that the program’s success rates have increased significantly since the 2009 study. Specifically, the incubator has increased the number of active client companies from 70 in 2009 to 118 in 2011, and the aggregate number of employees of these companies increased from 303 in 2009 to 721 in 2011 – an increase of 138 percent. Using an industry standard ‘multiplier effect,’ these additional employees generated an additional 672 jobs within the Metro Orlando region, compared to 313 jobs in 2009.
“The explosive growth of UCF’s Business Incubation Program in just two years has been matched by an equally impressive impact on our regional economy,” said Randy Berridge, president of the Florida High Tech Corridor Council. “This study reveals the true power of incubation using UCF’s proven formula for success.”
Since its inception, the UCFBIP has serviced and housed more than 200 emerging companies, including 130 current clients as of February 2012. To date, more than 69 companies have graduated from the incubation program, more than doubling the 30 graduates noted in the 2009 study. Of those 66 companies that had graduated when the report was prepared, 50 have remained in the Metro Orlando region, providing 845 jobs, representing an 85 percent retention rate from the five incubators studied in 2009.
The total direct economic output of the graduated companies that have remained in the Metro Orlando region is estimated to be $94 million annually, a 70 percent increase over the 2009 estimate of $54.7 million. Additionally, the total jobs created by graduated firms equals 1,717 jobs with earnings of $69.8 million, compared to 1,000 jobs and earnings of $40.6 million in 2009.
“By helping emerging companies in their early years, we are making a significant impact on the Central Florida economy and creating high-wage jobs that benefit our region,” said Tom O’Neal, UCF’s associate vice president for Research & Commercialization and executive director of the UCFBIP. “We look forward to helping more companies become successful, and we are very excited about soon adding the 10th incubator to our Program in Spring 2012, when the UCF Business Incubator – Apopka will open its doors.
Following the 2009 study, local and county government partners funded the opening of five additional UCF incubators in Kissimmee, St. Cloud, Leesburg, Daytona Beach and Sanford, bringing the number of sites studied to nine, and expanding the reach and accessibility of services to entrepreneurs throughout the Central Florida region.
Total annual funding for all nine current facilities topped $1.8 million in 2011 from city and county governments; however, the study estimated an annual return on investment of $9.1 million in the form of property, school and sales taxes from client and graduate companies. As well, the study calculated a separate ROI only looking at the facilities that were originally studied in 2009. The ROI of the original incubator sites in 2011 rose to more than $10 for every $1 invested, compared to a $5.25 return in the 2009 study.
Over the past 10 years (2002-2011) public government funding commitments for the UCFBIP have reached a cumulative total of $6.45 million provided by the University of Central Florida, Orange County, the City of Orlando, Seminole County, the City of Winter Springs, the City of Sanford, Lake County, the City of Leesburg, the City of St. Cloud, and the Florida High Tech Corridor Council.
To view the entire study, visit www.floridahightech.com/publication/study/ucf-incubator-impact-study-update.pdf.
About the Florida High Tech Corridor Council
The Florida High Tech Corridor Council (FHTCC) is a regional economic development initiative of the University of Central Florida (UCF), the University of South Florida (USF) and the University of Florida (UF) whose mission is to grow high tech industry and innovation in the region through research, workforce and marketing partnerships.
The unique partnership involving more than 25 local and regional economic development organizations (EDOs) and 14 state and community colleges, has resulted in a strategic approach to high tech economic development that involves matching funds research, workforce development and a marketing program leveraging governmental, EDO and corporate budgets on a regional rather than local basis.
The Florida High Tech Corridor Council was the International Economic Development Council’s category winner for Partnerships with Educational Institutions during its 2009 Excellence in Economic Development Awards. In 2010, the State Science and Technology Institute (SSTI) awarded the Council’s Matching Grants Research Program in the category of Improving Competitiveness of Existing Industries as part of its 2010 Excellence in Technology-Based Economic Development Awards.
For more information, visit www.floridahightech.com.
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