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Historic congregations contribute $1.7 million in economic impact to their community each year
A new study explores the relationship between a religious community's activities and the economic health of its surrounding area. - photo by Kelsey Dallas
Historic congregations in America's urban centers contribute around $1.7 million to their local economy each year, according to new research on the economic impact of sacred places.

By frequenting nearby businesses, hiring local workers and operating schools, faith groups strengthen their community's social safety net and economy, researchers noted. Their report "suggests that the secular world has a significant stake in the health and vitality of congregations and sacred places," said A. Robert Jaeger, president of Partners for Sacred Places, a nonprofit focused on supporting older religious buildings.

"Eighty-seven percent of the beneficiaries of the community programs and events housed in sacred places are not members of the religious congregation," according to the new study, which was released Nov. 29.

Jaeger's organization produced the "The Economic Halo Effect of Historic Sacred Places" report in partnership with Ram Cnaan, director of the program for religion and social policy research at the University of Pennsylvania's School of Social Policy and Practice. Results were based on a study of 90 historic congregations, located in Philadelphia, Fort Worth, Texas, and Chicago.

Even a casual reader won't miss that the study's authors are pro-religion. However, the report relies on recognized social science techniques, producing results that should be required reading for local policymakers, as well as U.S. government leaders, participants stressed in a Tuesday morning panel on the study, which was hosted by The Brookings Institution.

"We make a serious mistake if we think houses of worship are only serving that function," said panelist Melissa Rogers, director of the White House Office of Faith-based and Neighborhood Partnerships.

Valuing religion

The study splits a congregation's economic impact into three categories: direct spending, education and catalytic effects, or the financial benefits set in motion by religious activities.

Direct spending, which accounts for 32 percent of the $1.7 million average, includes key factors keeping faith communities in business: employees, buildings and food. Houses of worship hire local workers to be administrative assistants or janitors; purchase plates, communion bread and other supplies at local stores; and contract with nearby companies to fix a leaky roof or build an addition.

Education is the largest piece of the pie, accounting for 40 percent of the funds flowing from houses of worship into the surrounding community. Researchers assigned a dollar value to services offered by church-sponsored daycare or preschool programs, as well as parochial schools.

Like the other aspects of this analysis, the education category is an average of the data collected from the participating houses of worship. Some congregations offer no education-related services, while others have expansive programs.

The final area subjected to financial analysis, catalytic effects, includes the economic impact of attracting visitors and offering social services, such as substance abuse support groups or after-school programs. This category represents 28 percent of the overall economic value of historic congregations.

Beyond offering an overview of the calculations that led to the $1.7 million figure, "The Economic Halo Effect of Historic Sacred Places" shares a few brief case studies of the participating institutions, which included Protestant, evangelical, Catholic, Jewish and Eastern Orthodox congregations.

For example, researchers write that, "in an average year, St. George's United Methodist Church (in Philadelphia) hosts roughly 1,000 wedding guests, 900 museumgoers/researchers and 500 arts patrons from outside the city."

Cnaan, who has been a pioneer in the field of religion-related valuation, called the new research both important and preliminary, noting that the study doesn't attempt to assign a dollar amount to some services, such as connecting a congregant with a job opportunity.

"This is a very, very conservative estimate," he said. "My dream is that someone will come back in three years and say, 'I did a study that's much better than yours.'"

Panelist William Galston, a senior fellow in governance studies with Brookings, said that future research should attempt to address the economic drawbacks of religious institutions. After all, houses of worship enjoy massive tax subsidies and faith leaders can't guarantee that all visitors will eat at a local restaurant or stay in a nearby hotel.

"What's the extent to which we're talking about the displacement of economic activity rather than a net addition to it?" Galston said.

But like his co-panelists, Galston was enlightened by the research, noting it helped him understand the economic benefits stemming from his own house of worship, Tifereth Israel Congregation in Washington, D.C.

"I'll never look at my little congregation in exactly the same way again," he said.

Uncertain future

This new study comes on the heels of a report that put the overall value of U.S. religion at $1.2 trillion.

Employing similar methods as Cnaan and his fellow researchers, co-authors Brian and Melissa Grim, a father and daughter team, totaled the average annual incomes of America's houses of worship, the annual revenues of faith-related organizations, including hospitals and schools, the annual revenues of religious businesses and a valuation of social services provided, such as job training. Their estimate of the social-economic contributions of U.S. religions is larger than the annual revenues of Google, Apple and Amazon combined, as the Deseret News reported in September.

The latest study underscores the Grims' efforts and showcases the vital economic and social benefits houses of worship bring to their communities, Rogers said.

"Service matters to all people who are served," and it also matters to anyone "who cares deeply about the people who are struggling," she said.

The study also comes at a time when many religious groups are struggling financially, whether because their historic building needs expensive repairs or pews are too empty or both. Two of the 90 participating congregations closed during the study period, Cnaan said.

In their analysis of the study's takeaways, researchers argue that many community leaders fail to recognize the meaningful contributions people of faith are making in their area. They highlight policies that unnecessarily burden houses of worship, such as regulations that restrict a church from renting out its space to a local theater group.

Congregational leaders and public officials need to work together to minimize red tape, Rogers said.

Although there is more research to be done on religious groups' relationship to their surrounding community, Jaeger hopes this report will convince readers that many people stand to benefit from a thriving faith house of worship.

"Are Methodist churches of value to people who are not Methodists? Are synagogues important to people who are not in the Jewish community? The answer is a resounding yes," he said.
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