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Indiana Business Research Center

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University Communications

Last modified: Tuesday, December 11, 2007

IU Kelley School report details value of libraries to Hoosier economy

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University libraries, such as IU's Wells Library, pump $136 million into the state economy

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Dec. 11, 2007

"A library not, then, an article of mere consumption but fairly of capital, and often in the case of professional men, setting out in life, is their only capital."
-- Thomas Jefferson (1743-1826)

BLOOMINGTON, Ind. -- The intrinsic value of libraries has been lauded for centuries, but a new Indiana University study found that for each dollar of public library expenditures, the average Indiana community receives $2.38 in benefits.

The total market value of goods and services provided by the state's public libraries is estimated at $629.9 million.

IU researchers also found that library spending has a ripple effect throughout the local and state economy. In addition to the payroll of nearly 7,000 employees and operating expenditures on goods and services totaling $263 million statewide, public libraries account for an additional 2,000 jobs and $216 million in economic activity in Indiana.

The study was done by the Indiana Business Research Center in IU's Kelley School of Business for the Indiana State Library. An article about the study appears in the new edition of INContext, a publication the IBRC produces in partnership with the Indiana Department of Workforce Development and the Indiana Economic Development Council.

In addition to studying local public libraries, the study examined the economic impact of Indiana's collegiate and university libraries, like those at IU. The state's academic libraries have a combined staff of more than 2,200 full-time equivalent employees. Those libraries pump $136 million into the state economy in the form of wages and expenditures.

The economic ripple effects of academic-library spending support 640 additional jobs and create approximately $112 million in incremental economic activity in the state.

"I am very pleased that the report's findings reaffirm what those in the library community already knew -- Indiana libraries are a great value for Hoosiers," said Roberta L. Brooker, Indiana state librarian. "Indiana libraries are about more than just lending books. This report provides a statistical analysis of the immense value of the local library as a catalyst for economic development, provider of professional development and lifelong education services, and as a cultural and civic center of the community."

Researchers used three main tools: an economic impact analysis, a benefit-cost analysis of library services and surveys of public library patrons and staff. In addition, the IBRC conducted in-depth case studies of 12 local libraries in the state, interviewing businesses leaders, public school officials, chambers of commerce and local development officials on their opinions of how local libraries encourage economic development.

"Many business and community leaders are enthusiastic about the role that their library plays in economic and business development; however, the performance across libraries is uneven," said Timothy Slaper, IBRC director of economic analysis and co-author of the report.

"Many communities consider their libraries to be a social and economic anchor," Slaper added. "This sentiment -- that libraries contribute more broadly than to just economic prosperity -- is shared both by patrons and local leaders.

In several communities, the report mentions, a visit to the library was an important stop on the area tour when local leaders are trying to lure a firm to their community. In some of the case-study communities, the local leaders surveyed were convinced that their public library helps attract new business.

Close to 6.05 million Hoosiers live within a library district. The report said the per capita market benefits for library services are roughly $104, while the per capita costs are just shy of $44.

"Public libraries are worth a lot more than they cost," Slaper said. "The 2.38-to-1 benefit-to-cost ratio represents a conservative and defendable estimate of the value Hoosiers derive from their libraries."

In the report the IBRC identified six ways in which Indiana libraries can develop more active economic development and business growth strategies. The complete report is available online at

Also in the new issue of INContext are reports about "Hoosier engines of job growth," state exports and population projections between now and 2040. It is available online at

Established in 1925, the IBRC is an information outreach service of the Kelley School. It provides and interprets economic, demographic and social information needed by business, government, educational and other nonprofit organizations and individual data users in the state and throughout the nation. Its research can be found online at