Horses drive $3 billion in annual economic impact in Kentucky and create almost 41,000 jobs, according to the first in-depth study in decades of one of the state's signature industries.
The University of Kentucky economic analysis, based on statewide surveys of horses and of the people who enjoy them, shows that the equine industry creates about $1.4 billion in new income paid to workers, profits to businesses and dividends to shareholders and generates about $134 million in tax revenue for the state.
The $600,000 study, released Friday, was commissioned by the Kentucky Horse Council and paid for by a grant from the Governor's Office of Agricultural Policy and the Agricultural Development Board, along with matching funds from the horse industry.
Agriculture and equine groups sought the study to quantify what the horse industry brings to the state and highlight opportunities for future investment.
Jill Stowe, director of UK's ag equine erograms and lead economist on the study, said that it should be a benchmark for policy makers, community planners and veterinarians because of its scope.
"I think this data will be useful for business owners and entrepreneurs, who might say we didn't realize there were so many horses in this area," Stowe said. "For instance, we have a lot more trail riders in this area and we don't really have any trails. So maybe we can get some local support for trails."
Patrick Neely, spokesman for the Kentucky Equine Education Project, or KEEP, said the study shows the importance of the horse industry to the state's overall economy.
"Unfortunately, it also demonstrates that we have lost a large number of industry-related jobs in the past eight years, as our surrounding states have continued to use their competitive advantage to lure horses and industry jobs to their states," Neely said. "Until we put our purses and breeders incentives on a level competitive playing field with our competitor states, we will most likely continue to lose jobs."
KEEP has lobbied Frankfort for expanded gambling at racetracks and has said that without casinos thousands of equine jobs are at risk.
KEEP used to use a figure of 100,000, based on an American Horse Council study that found 51,000 horse industry jobs in Kentucky. But the UK study found far fewer jobs linked to the industry, which lost many jobs since the 2008 recession.
"The survey methodologies were different," Stowe said. "Certainly there has been some contraction, and we would expect to lose some jobs both directly and indirectly. But if you look at the numbers KEEP has reported, and the American Horse Council study from 2005, the numbers are quite different and a large part of that is because they did the study differently. I feel quite confident in our study because of the way we did it."
The $3 billion in economic impact -- which represents gross revenue generated by the industry -- includes $1.8 billion in direct effect plus $1.2 billion in indirect and induced effects. The net impact of this is about $1.4 billion, after costs are factored in.
Biggest impacts: racing, breeding
Thoroughbred horses are the most numerous breed in Kentucky, and the biggest economic impact comes from the racing section, at $1.28 billion, with an additional $710 million from the breeding sector.
Behind that, the biggest economic impact comes from something Kentucky has worked hard to develop as a niche market: horse competitions.
The researchers surveyed thousands of visitors -- people from out of state or out of the country -- at equine events to gauge economic impact.
According to the study, small horse events with about 200 attendees generate $21,400; large ones with 2,000 attendees might generate 10 times that amount.
The economic impact of the 2013 Rolex Kentucky Three-Day Event at the Kentucky Horse Park in Lexington, which drew more than 50,000 spectators, was $14.2 million, the authors found.
That is comparable to a spring and fall meet of Keeneland racing, which estimated $15 million in economic impact for its 2012 meets combined.
Another factor the UK researchers measured: How much is the rural landscape that comes along with lots of horses worth to Kentuckians?
Earlier this year, they mailed surveys to 8,000 people across the state to ask that question.
A large majority said they would support a hypothetical free program to protect farmland. Of those who were supportive, 80 percent were willing to pay "some amount of increased taxes" to preserve the horse industry, and 60 percent said they would pay $50 or more a year.
Earlier this year, UK reported results from its initial survey of the horse population by breed and use.
The most common use of Kentucky horses was for trail riding or pleasure riding, with 79,500 horses compared to 38,000 broodmares.
The data released Friday dug deeper into the numbers, breaking the horse population down by county.
Although Central Kentucky, home to top Thoroughbred breeding operations, has the most horses, there are some surprising clusters elsewhere: