Study: Horse Industry Produces $102 Billion in Spending
Updated: Thursday, June 30, 2005 12:20 PM
Posted: Tuesday, June 28, 2005 10:14 AM
American Horse Council president Jay Hickey.
The horse industry in the United States contributes $39 billion in direct economic impact and generates about $102 billion in total spending, according to a detailed economic impact study released June 28.
"The Economic Impact of the Horse Industry in the United States" was conducted by Deloitte Consulting and commissioned by the American Horse Council. Major funding for the report came from the American Quarter Horse Association, The Jockey Club, the National Thoroughbred Racing Association and Breeders' Cup, the Keeneland Association, the American Paint Horse Association, the American Association of Equine Practitioners, the United States Trotting Association, the Thoroughbred Owners and Breeders Association, and the United States Equestrian Federation.
The study is the first of its kind since 1996. During the AHC National Issues Forum in April, a Deloitte representative said the number of participants surveyed for the latest study was about 17,000, up from 5,000 for the 1996 document. Because of that, information is expected to be more meaningful and accurate.
"This study paints a portrait of an industry that operates in every corner of the country and contributes mightily to the American economy and culture," AHC president Jay Hickey said in a release. "Never before has the impact of our industry been so dramatically demonstrated."
The study, which encompasses all breeds of horses, says there are about 9.2 million horses in the U.S. The recreational segment accounts for $32 billion of the total economic impact, followed by the horse show segment at $28.8 billion and the racing segment at $26.1 billion.
The largest single contribution to the gross domestic product comes from Thoroughbred racing at $20.8 billion.
In the racing sector alone, about 430,000 horses are involved in the breeding process, which has a direct impact of $2.5 billion on the industry and total economic impact of almost $6 billion.
The study also offers a comparison of revenue to expenses that support a common belief in the horse industry. Total revenue from all segments is $1.17 billion, while expenses come in at $2.88 billion. Expenses therefore exceed revenue 240%.
For racing alone, expenses exceed annual revenue by $1.5 billion, the study says. For show horses, the figure is $2 billion; for recreational horses, it's $1.8 billion. The average is $1.7 billion in expenses over revenue.
"This per horse revenue and expenses analysis indicates that horse ownership is generally not undertaken as a profit-making operation," the study says.
The study estimates that 4.7 million people participate in the horse industry, 1.8 million of them as owners. The industry provides about 700,000 jobs across all sectors, the study says.
The 15 breakout states account for more than 51% of the U.S. horse population. In terms of total effect on the gross domestic product, California leads the way at $6.97 billion a year, followed by Texas ($5.23 billion), Florida ($5.15 billion), Kentucky ($3.54 billion), and Louisiana ($2.45 billion).
Texas has the most horses with 978,822, followed by California (698,345), Florida (500,124), Oklahoma (326,134), and Kentucky (320,173).
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