Churches and Economic Development

by Christine Hamilton-Pennell
Growing Local Economies, Inc.

Most people don’t think of churches and other houses of worship as drivers of economic development. After all, the separation of church and state in the U.S. means that not-for-profit religious institutions do not pay property and other taxes. A community that depends on property taxes to drive government revenues will lose money on the property owned by a church or other house of worship (temple, synagogue, mosque, or shrine).

But looked at from another perspective, churches and other houses of worship contribute to the local economy in a variety of ways. Most churches employ at least one person, and many have upwards of 20 employees, especially if they operate a childcare facility or school. Since they generally operate a facility, churches are consumers of energy to heat and cool the often large, open spaces. They also use insurance, maintenance, landscaping, and construction services (albeit sometimes as volunteer labor), and they consume office supplies, furniture, curriculum materials, and specialty church items.

Participants in religious organizations represent a significant market for religious goods and services. According to the 2009 annual edition of the Yearbook of American & Canadian Churches (edited by the National Council of Churches and published by Abingdon), membership of the top 25 churches in the U.S. totals more than 146.6 million. A 2004 Gallup Poll reports that six in ten Americans consider religion to be a “very important” part of their lives and another 26 percent responded that religion was fairly important. More than eight in ten were affiliated with a Christian religion, and half of the respondents said they were Protestants. The largest single religious denomination was Catholic, accounting for about 25 percent of Americans. Some 2 percent were Mormons and another 2 percent were Jewish.

In 2006, a Packaged Facts report on religious markets predicted that the overall religious market for publishing, inspirational merchandise, and audio/video/software product would grow to $9.5 billion by 2010.

On a more personal level, many entrepreneurs report that the religious community has been an important source of moral support for them as they start and grow their businesses. The connections made in a worship community can lead to financial opportunities as well.

Beyond their role as consumers of goods and services, however, churches and their members can also be a force for economic development in their local communities.

The Black church in the U.S. has been aware of its important role in economic development since the time of slavery. In 1977, Gil B. Lloyd wrote an article, “The Black Church and Economic Development,” in which he demonstrated that, historically, the Black church has played an important role in the social and economic life of the Black community. He argued that the Black church, often in partnership with the federal government, has provided both moral and economic impetus for the economic redevelopment of urban areas.

Fast forward to 1993, when Black Enterprise featured a cover story entitled, “The New Agenda of the Black Church: Economic Development for Black America.” In it, author Lloyd Gite profiles the work done by Black churches in several urban areas, including Detroit’s Hartford Memorial Baptist Church, which invested heavily in local economic development projects, from building shopping centers to senior citizen housing in order to create jobs and businesses.

Rev. Charles Adams, Hartford Memorial’s pastor, offered his perspective. “The church needs to concentrate on the business of creating economic institutions,” declared Adams. “The issue is jobs. People being laid off through all this corporate downsizing is affecting every black community in this country. The church finds itself in a situation where it is the best continuing, organized entity in the black community for the acquisition and redevelopment of land, the building of business enterprises and the employment of people.”

“The black church recognizes it has to be in the forefront of economic development,” says C. Eric Lincoln, author of The Black Church in the African-American Experience. “It has become evident that black people are simply going to have to stand on their own feet and the black church, with all of its economic power, can help facilitate that by creating businesses.”

The same issue of Black Enterprise also includes an article on how to set up an economic development plan for a church.

A 2006 article in The State, “Church Plans Tangible Change to a Community,” was picked up by The Black Informant, http://www.blackinformant.com/, and reiterates this theme. The article states, “In many cities and towns, the net result of diminishing government and private investment, deteriorating infrastructure, business closures and joblessness is the perpetuation of an underclass disenfranchised from mainstream society. While many of these areas are distressed and full of despair, the good news is that African-American churches are bringing the gospel of economic development to these communities and renewing hope for a better way of life. The article profiles the economic development work done by Columbia, South Carolina’s Bible Way Church of Atlas Road.

“Bible Way Church of Atlas Road, through its Midlands Community Development Corp., is helping lead the way. The church recently announced a 106-acre mixed-use project that will include affordable homes, a new worship center, a performing arts building, a recreational facility, a hotel and a commercial and medical complex. These developments could transform the Lower Richland community and have rippling effects across the Midlands.

“When such developments take place in low-income areas, they increase property values, attract new residents and become magnets for diverse businesses and better-paying jobs. Church-based business enterprises help rebuild a community’s social infrastructure and provide such much-needed values-based services as child care, youth development, elder care and substance abuse counseling. These activities tend to lead to improved schools, better public safety and an enhanced quality-of-life. From this type of community economic development, everyone—those living in the area and those in surrounding communities—benefits.”

Of interest is an upcoming book by Marci Bounds Littlefield, Assistant Professor of Sociology at IUPUI, who works in the areas of race and ethnicity, urban development, and family in relation to religious institutions. She writes on the black church and economic development in the United States and is presently at work on a book titled Religious Institutions and New Ventures: Evidence from the African American Experience, http://www.iupui.edu/~raac/fellows.html.

Finally, a recent research study by Jonathan Gruber of the MIT Department of Economics looks at the implications of religiosity for economic outcomes. He determines that a major determinant of religious participation is religious market density, or the share of the population in an area which is of an individual’s religion. His findings are that a higher market density leads to a significantly increased level of religious participation, and as well to better outcomes according to several key economic indicators: higher levels of education and income, lower levels of welfare receipt and disability, higher levels of marriage, and lower levels of divorce.

Churches and other houses of worship are part of the network of assets in a local community. Regardless of the fact that their fortunes are tied to the rise and fall of the economy, they are a significant force for economic development in at least three areas—as investors, consumers, and support groups for entrepreneurs.

Sources:

“Church Plans Tangible Change to a Community, November 24, 2006, The State, reported in The Black Informant, http://www.blackinformant.com/uncategorized/church-plans-tangible-change-to-a-community.

“Consumer View: Religious Market: Provided Retail Remains Healthy, the Religious Market Will Continue to Grow.” License Global!, September 1, 2006, http://www.licensemag.com/licensemag.

Gite, Lloyd. “The New Agenda of the Black Church: Economic Development for Black America,” Black Enterprise, Dec, 1993. http://findarticles.com/p/articles/mi_m1365/is_n5_v24/ai_14680366.

Gruber, Jonathan. Religious Market Structure, Religious Participation, and Outcomes: Is Religion Good for You? National Bureau of Economic Research Working Paper Series, No. 11377, May 2005. http://www.nber.org/papers/w11377

Lindner, Eileen W., National Council of the Churches of Christ in the United States of America, eds. Yearbook of American & Canadian Churches. Nashville: Abingdon. 2009.

Lloyd, Gil B. The Black Church and Economic Development,” Western Journal of Black Studies, v1 n4 p270-75 Dec 1977.

“Religious Organizations.” Encyclopedia of American Industries. Gale, 2008. Reproduced in Business and Company Resource Center. Farmington Hills, Mich: Gale Group. 2009.

(c)2009 Christine Hamilton-Pennell, Growing Local Economies, Inc.

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2 Comments »

  1. Sorry if I seem like a geek for commenting on every post, but I view blogs as opportunities for conversation and all your topics so far have sparked my interest!

    We have a church in our area (www.gracegladstone.com) that has experienced rapid growth in the last five years. Attendance has gone from a couple hundred people to nearly 600 worshippers last Sunday. The church just built a big new worship center to accommodate the growth, which certainly had a positive impact on our local economy, especially in a year when there was very little new construction.

    I keep thinking about how this growing church relates to economic development. To your list I would add this – churches can serve as visible signs of growth, vitality, and overall well-being in a community. Talented, entrepreneurial people want to live and work in places that are growing and vibrant and offer opportunities to build relationships with like-minded people. A strong church is one way to attract and retain a talented workforce. A thriving arts organization could do the same (we have one of those, too, in Delta County.)

    • Christina, I love your additions to my thoughts about churches and economic development. I think you are exactly right about how churches provide visible signs of growth that indicate the community is a vibrant place to live and work. Thanks for the suggestions! I am writing a piece about arts and the economy as well…

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