What A Church Does, in Dollars and Cents

A sociologist explains a congregation's contributions to the local economy.

University of Pennsylvania sociologist Ram Cnaan has been researching the economic value of churches for more than two decades. Because some congregations would almost certainly close their doors without tax exemptions, Cnaan thinks proponents of taxing churches are misguided.

Your research looks at the “halo effect” that churches have on their communities. What is the “halo effect”?

It is the way that congregations contribute to the local economy. Churches spend money locally, and since they spend money locally, they enhance the local economy. So on a small scale, every church buys flowers. Where do they buy flowers? From a local florist. No one mentions this, but across the country there are florists in business because of local congregations.

People don’t look at the value of the congregation financially. They look at the spiritual aspect. Now, I’m not a person of faith, I’m a social scientist. I started to look at the congregation as an economic engine. What is the value that an urban congregation on average contributes to the local economy?

In the first study [in 1996], we went to 10 congregations in Philadelphia and we looked at the replacement value of social services like finding people jobs. On average, it was $140,000 per year. Of course, social services is only a small component of what congregations do. So next we looked at 90 churches in Philadelphia, Chicago, and Fort Worth, and all the ways they contribute to the local economy. There was a range—each generated between $1.2 and $2.5 million annually. Read More

Also See:
No Friend of Tax Collectors