Kentucky's Return on Investment

Consider for a moment your smartphone. Within its aluminum and glass casings are technologies derived from publicly funded federal research. Undergirding all of the apps, services, and software are global platforms and utilities developed through basic and applied scientific discovery:

·        The Internet was an early project for the Defense Advanced Research Projects Agency (DARPA) – a high-risk, high-reward research arm of the Department of Defense created after the former Soviet Union's launch of Sputnik.

·        GPS was also developed by DARPA and now supports navigation apps and location services tied to countless tools we use every day.

·        Two Stanford students – with support from the National Science Foundation (NSF) – developed a new search algorithm in the 1990’s. The company that developed from that early innovation is now known as Google, and is publicly valued at $387 billion.

·        Voice-recognition software is an early DARPA project, and now supports civilian and industry platforms like Siri.

·        And the earliest touch screen system was pioneered by a former UK faculty member, Samuel Hurst, with publicly funded support for his research.

These innovations are only a small sample of the early-stage, publicly-funded, foundational research projects that now support, not only industries and private business, but entire markets on national and international scales. The NSF found that technology transfer agreements of university research to the private sector yielded an “impact up to $836 billion in gross industry output, $388 billion in GDP, and three million jobs” between 1996 and 2010.

In the Commonwealth of Kentucky, more than half of all basic, translational, and applied university-led research happens at the University of Kentucky. Pioneering UK faculty and staff are on the frontlines of the questions of our day. Last year, they earned $285 million in competitive external grants and contracts, helping propel us toward the top echelons of the nation’s research universities.

Recently, Provost Tim Tracy highlighted three companies derived from research and discovery developed by UK faculty – important success stories in commercializing research to marketable products. Their work has a powerful impact on our community, state economy, and the industries their leadership helps shape.

In 2014, an independent study concluded that UK’s research enterprise – fueled by competitive grants and contracts – had an economic impact exceeding $580 million annually, affecting 8,114 jobs and $21.3 million in state and local taxes.

To be sure, our research and creative discovery shape industry, create jobs, and broaden our understanding of the artistic, human, and technological world, but that is only one way in which the state’s flagship, public, research university serves Kentucky.

In total, UK’s $3.4 billion academic, research, health care, and service enterprise means the Commonwealth of Kentucky gets a return that 12 times its investment of $280 million.

Our 12,500 full-time employees on our campus, at our hospitals, and across all 120 counties of Kentucky collectively contribute more than $90 million paid in state and local taxes. And that number continues to grow year after year through the high-wage jobs we’re creating and bringing to Kentucky. This is a rich and rewarding return to communities from Pikeville to Paducah.

The number of patients served with sophisticated health care by the University of Kentucky has grown more than 95 percent since fiscal year 2003 -- 37,333 patients in our hospitals and 1.4 million visits to our clinics last year alone.

In a recent report from the Kentucky Council on Postsecondary Education, more than 60 percent of our graduates are employed in Kentucky one year later, while 10 percent choose to continue their education. These are the professionals, community leaders, and taxpayers who stay here and strengthen the economic and civic vibrancy of Kentucky.

Last week I wrote about the impact of Kentucky’s return on its investment in the broader higher education community. These powerful stories highlight some of the specific returns our state receives from its investment in its flagship institution. We are the University for Kentucky. Though our reach and scale have expanded since 1865, UK’s future remains inextricably linked with the state we are proud to lead and to serve.


Eli Capilouto


To read more about the important role the public plays in scientific research and – through it – a robust economy, please read the National Science Foundation’s report, “Federally Supported Innovations: 22 Examples of Major Technology Advances That Stem From Federal Research Support.”