This is an excerpt. Click here to read the full report (PDF).

The genius of Mayor Bloomberg’s plan to develop a new applied sciences campus in New York City is that it acknowledges the increasingly pivotal role of academic institutions as drivers of local economic growth. At a time when large corporations may not be the reliable job producers they were in the past and cities like New York badly need to generate new sources of job growth, universities are critical local anchors that employ thousands, spin out new businesses and train the workers needed by growing industries.

But it is not just scientific research institutions and engineering schools—like the one that Cornell and Technion are building on Roosevelt Island—that provide this kind of spark. In New York, design and architecture schools arguably have been as, or more, important to the city’s success in the innovation economy.

New York design universities such as Parsons The New School for Design, the Fashion Institute of Technology, Pratt Institute and the School of Visual Arts have been critical catalysts for innovation, entrepreneurship and economic growth. Their graduates have produced dozens of start-up companies that set up locally—something that has eluded most of the city’s scientific research institutions. Graduates of the city’s design and architecture schools founded many of New York’s most visible and influential design firms, including Studio Daniel Liebeskind, Diller Scofidio Renfro, SHoP Architects, Smart Design, Ralph Applebaum Associates, Calvin Klein, Marc Jacobs and Donna Karan International.

They also provide the talent pipeline for New York City’s creative industries—including the city’s fast-growing design and architecture sectors. Indeed, New York City graduates twice as many students in design and architecture than any other city in the U.S. And enrollment at New York’s design universities has been growing at a faster rate than other universities in the city.

Thus far, the “innovation economy” initiatives advanced by city and state officials have largely overlooked design universities. This is a missed opportunity in a city that is arguably more of a creative hub than a high-tech center. As this report demonstrates, New York’s design universities are already a key piece of the city’s innovation infrastructure. But at a time when designers are having a growing influence on everything from smart phones to the delivery of health care services, these institutions are poised to play an even more central role in New York’s economic future.

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In 2009, the Center for an Urban Future published Building New York City’s Innovation Economy, a major report that examined how to better harness the city’s high-caliber scientific research institutions for local economic development. The report found that most of the city’s research institutions, though successful in generating revenues from patents, had an underwhelming record of turning their research discoveries into local start-up enterprises.

Although important differences abound, this report tackles a similar subject from the perspective of design and architecture. Drawing from a wide range of institutional data, survey results, and extensive interviews with more than 50 academic leaders, educators, entrepreneurs and business executives in New York’s design and architecture communities, the report documents the contributions of design and architecture schools to the New York City economy. Funded by the Rockefeller Foundation, it assesses the breadth of programs and educational assets and evaluates trends with respect to enrollment, employment, spending and, like our science report, business creation. 

In contrast to engineering and scientific research institutions, design and architecture schools have not traditionally been thought of as important contributors to innovation and competitiveness. But, as we show in this report, that is a mistake.

New York City is home to ten prominent design and architecture schools, as well as a half-dozen other organizations that offer rigorous programs in design or the business of design.  These schools attract creative talent from across the country and around the world to New York, provide the city’s many design and architecture firms with a pipeline of talented workers, supply jobs to professionals who teach part-time and act as important anchors for the circulation and exchange of ideas. Importantly, they also produce a steady stream of locally-based start-up companies. An astounding one third of the 386 members of the Council of Fashion Designers of America, a national association with members around the country, attended FIT, Parsons or Pratt. Overall, nearly 20 percent of all Pratt, Parsons and SVA graduates went on to start their own businesses. In contrast, the city’s leading scientific research institutions—including Columbia, NYU, Mt. Sinai School of Medicine, the Albert Einstein College of Medicine at Yeshiva University and Memorial Sloan-Kettering Cancer Institute—generated 21 technology startups in 2007.

“Design schools are incredibly important to New York City,” says Tom Vecchione, a principal in the New York office of Gensler, one of the city’s largest design and architecture firms. “They’re a big part of making New York the premier design-focused city in the world.”

“We have about 1,200 employees at Parsons, and that’s just faculty; another 400 or so employees work at the school,” adds Joel Towers, executive dean of Parson The New School for Design. “We also benefit the city from the creative activity from our students and faculty. And about 88 percent of our graduates remain in the New York City area.”

New York graduates more students with degrees in design and architecture than any other city in the U.S. by a large margin. In 2010, New York graduated 4,278 students in these two disciplines, while the city with the second most, Los Angeles, graduated less than half as many (1,769). New York has four design schools in the country’s top ten by the number of degrees awarded every year: the Fashion Institute of Technology (FIT) (#1), Parsons The New School for Design (#4), the Pratt Institute (#6) and the School of Visual Arts (SVA) (#8). And it has two architecture schools in the top ten by the number of degrees awarded: Columbia’s Graduate School of Architecture Planning and Preservation (GSAPP) (#5) and Pratt (#8).

In addition, the number of design and architecture graduates in the city has been increasing rapidly over the last five years: Between 2005 and 2010, architecture and design degrees increased by more than 40 percent citywide. By comparison, the total number of degrees in all majors rose by only 20 percent, while degrees in many other traditional disciplines such as fine and studio arts (16 percent) and economics (18 percent) rose even more slowly.

In terms of educational quality and prestige, quite a few New York-based schools stand out from the pack. Parsons and FIT are among the top five fashion schools in the world, according to Fashionista.com; no other American school was in the top 12. According to U.S. News and World Report, Pratt has the nation’s top-ranked interior design program, while the New York School of Interior Design (NYSID) is ranked fourth. Three New York schools—SVA (#6), Pratt (#9) and Parsons (#12)—have highly regarded graphic design programs. Similarly, among multimedia and visual communications programs, SVA and NYU’s Tisch School of the Arts are both national leaders. Pratt and Cooper Union are among the country’s most prestigious undergraduate architecture schools and U.S. News and World Report ranks Columbia’s GSAPP as the country’s fourth best graduate architecture program.

Meanwhile, NYU’s Interactive Telecommunications Program, Pratt, Parsons and SVA have all been featured in rankings by Bloomberg Business Week of the top schools around the world that teach “design thinking,” an emerging practice and educational philosophy that links design with broader business and innovation strategies. (The rankings, which were published in 2007 and 2009, include business and engineering schools, but no business or engineering schools in New York City made the list either year.)