Higher education and healthcare play a massive role in Tyler’s economy. Their impacts will grow even more, when the University of Texas at Tyler expands to include a medical school.
Tyler’s higher education institutions employ and educate over 25,000 people in the East Texas area according to institutional records from UT Tyler, Tyler Junior College and Texas College, while Tyler’s economic development council projects the city’s healthcare industry employs over 24,000.
Projections by Texas economic consulting firm The Perryman Group estimate that University of Texas System facilities, like UT Tyler and UT Health hospitals and clinics contribute almost 15% of Tyler area jobs, when considering the “multiplier effects” of factors like student and patient spending.
That number may increase in the coming years when the UT System expands its Tyler footprint with the addition of a medical school within the next several years.
UT Tyler administrators hope to enlist their first classes of medical students by the summer of 2023 as they finalize plans on the schools’ location, academic leadership and accreditation.
“The medical school will be 40 students per [class],” said Dr. Julie Philley, UT Tyler executive vice president of health affairs. “Medical school is four years, so it’ll be a total complement of 160 when the school is fully up and running… We’ll be hiring more than 75 different types of faculty members and staff to help service the medical school.”
The new school represents a huge investment in East Texas by the UT System that could impact Tyler’s local economy and healthcare industry. So what changes can Tylerites expect from a new medical school?
Constructing, staffing and filling the medical school with students will undoubtedly bring new jobs and spending to the East Texas area. What are the estimates on potential economic impact of this project?
Much of the data available on UT Tyler’s current and future economic impact comes from a study by The Perryman Group commissioned by private UT Tyler donors in 2019. The Perryman study details UT Tyler and UT Health East Texas’ local, regional and statewide economic footprint through factors like job creation and total spending.
Perryman’s estimates come from a patented economic model that analyzes “industry, real estate demand and absorption, occupations, and tax receipts,” to create a picture of the “ripple effects” of economic measures, according to the organization’s website.
“We have analyzed numerous (more than 100), universities, healthcare facilities and medical schools using these systems over the past several decades,” Perryman Group founder Ray Perryman said in an email to The Tyler Loop.
The Perryman study anticipates opening a medical school in Tyler would generate thousands of jobs outside of the school itself. Construction of the school alone could fund over 1,100 “job-years,” a term used by Perryman to describe the equivalent of one person working full-time for a year in the Tyler metropolitan area.
The construction job-year figures expand to 1,400 and 1,800 when considering impacts in the surrounding counties and all of Texas, respectively.
Once constructed, the medical school will employ over 75 faculty members and new staff and host over 150 new students, which could drive additional spending and job creation in East Texas.
Operational and student spending from the medical school, in addition to the spending of medical school graduates who stay in East Texas, could fund over 11,500 job-hours in Tyler and over 13,000 in the East Texas area, according to the Perryman study.
When combined with potential expansions to residency programs at UT Health Science Center Tyler, Perryman estimates spending from the new school could add over $2.3 billion dollars and more than 25,000 job-years to the city’s economy.
Tyler Mayor Don Warren called the investment a “game-changer” for the city.
“By adding a medical school to the academic health and residency programs already available in Tyler, future physicians will be able to obtain a comprehensive medical education without leaving the Rose City,” Warren said in an email to The Tyler Loop. “They will get their education right here and then stay to live and practice medicine.”
Parts of the Perryman study assume that a majority of medical school students will remain in Tyler and surrounding areas after graduation. Luckily for them, East Texas will offer no shortage of job opportunities for many kinds of doctors.
Data from a Texas Department of State Health Services study conducted in May of 2020 found the East Texas region lacked enough doctors to fulfill demand for family medicine, general internal medicine, nephrology, pediatrics and psychiatry in 2018.
There were not enough doctors in East Texas to reach 80 percent of demand for any of the highlighted fields — the largest supply deficit being nephrology physicians, reaching just 33.9% of 2018 demand.
DSHS expects this trend to continue into the 2030s according to the study, with the physician shortage potentially worsening for nephrology and pediatrics.
While the shortage may illustrate a troubling picture for the state of East Texas’ healthcare industry, it also represents potential for medical school graduates to find employment in an area without enough doctors.
“We anticipate that [the medical school] will fill that gap,” said Dr. Julie Philley, UT Tyler’s vice president for health affairs. “We have plenty of work for people…
“The key is to get medical students to graduate from our programs that then go to one of our residencies. There’s been studies that show that people tend to stay where they do their residency, and so we’re hoping that we can keep students that way.”
Tyler’s healthcare industry, already the largest segment of the city’s economy by number of people employed, is set to add around 900 jobs and grow almost 2% by summer of 2022, according to a study by the Tyler Economic Development Council in July 2021.
The industry is, by far, the largest contributor to Tyler’s GDP, adding over $2 billion in value — almost $1 billion more than Tyler’s manufacturing output — to the city’s total $11.2 billion in 2020.
Medical school graduates could help realize Tyler’s potential for growth if they decide to stay in the area, but careers in medicine may help them realize their individual potential as well.
Tyler physicians can expect to earn over $208,000 a year on average, according to job data compiled by ZipRecruiter and ADP — well above the city’s average annual wage of $48,782.
Paired with Tyler’s lower cost of living at 8% below the national average, recent graduates may find themselves in a good position to pay down the high costs of attending medical school.
Studies by the American Association of Medical Colleges estimate the national average cost for attending four years of public medical school at over $250,000.
Newer Texas medical schools, like the UT Rio Grande Valley School of Medicine established in 2013, tend to cost much less than schools in other states. In-state students at UTRGV’s medical school can expect to pay just under $195,000 for four years.
UT Tyler plans to offer incentive programs to lower costs, like tuition reimbursement for graduates who stay in the area, Dr. Philley said, but “nothing is set in stone right now.”
“Our hopeful goal is to train Texans that care about Texas to stay in East Texas,” Philley said. “In Texas, 90% of your students have to come from Texas when you’re a state school. We’re really excited about having the majority of our classes hopefully be from the region.”
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