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The area's largest employer aims for more growth

Rochester Business Journal
July 27, 2012

The University of Rochester is the region’s largest employer, ranks among the top research institutions in the nation and has a growing economic impact that has surpassed $2 billion in the Rochester area—but Joel Seligman sees the university as larger than all that.
 
The UR president has overseen continual growth since taking over in 2005, and the university has made large investments in academic programs and research. Though the growth looks good in dollar figures and employment numbers, Seligman notes that the community impact is equally important but more difficult to measure.
 
“We’re making consistent progress in terms of amplifying our role in the community,” he said.
 
He notes the university’s commitment to improving health care in the region. Through the University of Rochester Medical Center and other affiliates, UR provides more than $70 million in uncompensated care, Seligman notes.
 
“It’s an enormous investment because we see ourselves as part of the safety net of Rochester and hope to never back out of that,” he said.
 
That safety net is ever-expanding, Seligman added. In June, the university finalized an agreement with Thompson Health System to make Thompson an affiliate of URMC, allowing the two to share medical staff more easily at their various facilities. There will be further agreements with community hospitals throughout the region, Seligman said.
 
“One of the consequences of a very challenging period in health care finance has been the recognition that there are efficiencies you can achieve when you have the right scale of size without reducing the quality of care,” Seligman said.
 
The university’s numbers do tell a compelling story about its growth and stature in the local economy, he adds. A report released last month by the Center for Governmental Research Inc. detailed the university’s large and ever-increasing role. The study showed that UR’s employment reached 23,485 at the end of last year and its regional economic impact rose to well over $2 billion.
 
The full economic reach of the university is even greater, said Scott Sittig, senior research associate at CGR and project manager for the study.
 
“One of the greatest strengths UR provides is its help in diversifying the economy,” Sittig said. “They’re bringing new technology to the market and commercializing it, and they have cutting-edge research and health facilities. The university is a real incubator in some respects to what’s going on and adds a lot of fuel to the fire in the transition our economy has been doing in becoming less reliant on manufacturing.”
 
The economic impact study found that the university was responsible for $2.4 billion in wages, both directly and indirectly, and contributed more than $143 million in taxes to the Rochester region. It also found that UR is ultimately responsible for 47,000 jobs in the region, 8.8 percent of the total workforce.
 
Sittig, who has overseen previous biannual economic impact studies on the university, says UR has been on a steady growth curve even during difficult economic times.
 
“It’s been steady, which is remarkable in itself,” Sittig said. “Even through the economic downturn, they continued to get new research dollars in and spin out new research patents, help start new businesses and invest in new buildings and new programs.”
 
More major projects are in the works. The university has begun a $60.1 million expansion of the James P. Wilmot Cancer Center that will add more than 100,000 square feet, and it is planning a major economic development project in College Town. It also is expected to break ground this fall on the new Golisano Children’s Hospital, a $145 million tower that will have eight floors and nearly 245,000 square feet dedicated to children and their families.
 
UR’s investments are expected to pay dividends in the future. A project costing more than $100 million—funded jointly by the university, state and IBM Corp.—will bring a supercomputer to UR that university officials said would boost research efforts significantly.
 
Such investments in research and UR’s growing stature within the research community have helped it stay competitive during a time in which sponsored research funding has been harder to come by, said Peter Robinson, chief operating officer at URMC.
 
“In recent years we’ve seen a growth in research funding, the vast majority for the medical center coming from the National Institutes of Health,” he said. “We’ve taken advantage of the strong and growing presence of our solid research faculty, who have been very competitive.
 
“This growth has come at a time when there’s been a flattening of NIH funding, so we’ve really been much more competitive. Essentially, we’ve been able to grow our market share in a very difficult funding environment.”
 
The university received $415.2 million for sponsored research in the fiscal year ended June 30, 2011—down from the record $463.7 million the previous year as funding from the economic stimulus dropped off, but still far ahead of just a few years ago.
 
The university’s research prowess has other effects, Robinson noted.
 
“That strength in research funding is a key catalyst in driving our ability to find the best students, and the quality of our students has been growing in the medical school, which is now ranked as the 15th most competitive to get into,” he said.
 
The research funding perpetuates growth across the economy, Robinson added. New funding creates jobs both at the university and in the community through spinoff companies.
 
“Rochester is maybe the 50th-largest metro, but we have a top-20 academic medical center,” he said. “You can see that as a result we’re adding a lot of vibrancy to the community and its economy.”
 
There is more growth ahead, Seligman said. The university is working on an updated version of its strategic plan that will explore its role in the community.
 
This plan will have new areas of focus, like growth for the university’s College of Arts, Sciences and Engineering.
 
“They have had enormous progress that’s reflected in new programs, growth in faculty and growth in the student body,” Seligman noted. “We are likely in the next version of the strategic plan to focus hard on further strengthening the quality of arts, sciences and engineering.”
 
Other projects also are in the works, like the development of an unused downtown block across from the Eastman Theatre and completion of a project to develop the I-390 exit near the university to accommodate traffic better.
 
All told, the elements will combine to fuel continual growth, he said.
 
“Over not just the next five years but 10 to 20, I see us growing in overall employment up to 30,000 employees and growing our economic impact in the community over the expansion of health care and also tech transfer,” Seligman said. “We are taking a balanced approach to our mission, not just being a school strong in health care but also engineering and life sciences and across a number of areas.”
 
With an administration focused on growth, the university also will expand its stature in the Rochester area, nationally and internationally as a destination for students outside the United States, he said.
 
“Universities are always works in progress,” Seligman noted. “We’ve been fortunate to have a leadership department just as hungry as in 2004 and 2005 when I first started.”

7/27/12 (c) 2012 Rochester Business Journal. To obtain permission to reprint this article, call 585-546-8303 or email service@rbj.net.


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