Posts Tagged ‘kentucky’s horse industry economic impact’

The intent of the two articles, I assume, was to convince state legislators, who may have been on the fence about whether or not to vote “yes” on racetrack video lottery terminals (VLTs) or slot machines during the special session, that Kentucky’s horse industry a) isn’t really as big as people have been saying it is and b) no other state is ever going to challenge Kentucky as the national leader in foal production, so its tracks don’t need to offer the same expanded wagering menu that so many other states have.

The article about the number of people who are employed as a result of Kentucky’s horse industry was borderline outrageous. The author seemed to dismiss the 2005 economic impact study commissioned by the American Horse Council and its conclusions that there are approximately 96,000 direct and indirect jobs in the Bluegrass State resulting from the horse industry (all breeds and disciplines). Kentucky was one of 15 states for which detailed information was provided as part of a national study conducted by Deloitte Consulting. The study concluded there were 51,900 people directly employed in the horse industry in Kentucky. It also said that as a result of the horse industry’s spending power, there were another 44,100 “induced” or indirect jobs. Those jobs are not in the horse industry (they represent all kinds of jobs that horse industry people are responsible for supporting), but they wouldn’t exist if the horse industry wasn’t here. It’s a safe bet that if we lose some of those 51,900 direct jobs, the “induced” employment will fall as well.

The writer seemed to be saying the number was somehow “fudged,” that smoke and mirrors were used by Deloitte to get to 96,000 jobs. Jay Hickey, the president of the American Horse Council, said to his knowledge every industry that conducts an economic impact study does exactly the same thing. “I can tell you, they didn’t come up with this methodology just for the horse industry,” he said.

Incidentally, Deloitte concluded that the total number of direct jobs in the horse industry across the United States is 453,612, and there are nearly one million “induced” jobs, bringing the total direct and indirect employment to 1,411,333. Nationally, the direct economic impact is $39 billion, and it increases to a total of $102 billion when the indirect impact is factored in.

But let’s go back to Kentucky for a minute and the Herald-Leader story, which concluded there are only 51,000 horse industry jobs in the state—not 96,000 or 100,000.

That’s still an awful lot of jobs. How many other industries in Kentucky employ that many people? One thing’s for certain: the number of jobs in the horse industry will be lower the next time the legislature meets. Horses and the jobs that go with them are leaving the state to race where purses are higher and breeders’ incentives more lucrative.