Minnesota Libraries' Return on Investment Study

The Minnesota Public Libraries' Return on Investment Study conducted over the last year by the Labovitz School of Business and Economics at the University of Minnesota -Duluth has been released.

The study calculates that for every dollar invested in public libraries there is a $4.62 ROI. How was this figure calculated?

From the report:

"The return on investment (ROI) in Minnesota of public library service in 2010 is calculated as follows: Using contingent valuation, as well as a cost-based approach, the total economic contribution of Minnesota public libraries is estimated to be $898,041,512. The Minnesota population served by public libraries in 2010 is reported by the US Census as 5,303,925. The economic contribution per capita equals $169.32. The local and county tax support per capita equals $36.67. Therefore, the dollar annual return per dollar of public tax support equals $4.62. Comparisons with recent findings from other states show that Minnesotans enjoy a somewhat greater rate of return than the mean ($4.23) for a sample collection of other state's findings."

While the financial benefit is greater than the mean of other states, there is more to the story. Also from the report: "However, the social return on investment (SROI) from Minnesota public libraries is greater than the measureable return on investment. Other benefits of significant value include the collection of materials itself, and the many services of the library; the educational programs, as well as the educational and literacy benefits of the library's mission; technology for use in the library; the expertise of the library staff; the library facility as a community gathering place; the "halo" spending by library users at establishments close to the library; and the value of a library's enhancement to neighborhood real estate and community partnerships.

Although the need for public funding and competition from the Internet can be negative aspects for libraries, stakeholders enjoy many other positive aspects. Inside and outside the library system, library users with children or grandchildren benefit, as do employees from the community at large who check out materials for use at their workplace, library users who contact public library reference libraries for information, and technology users with a need for Internet access."

And bottomline, it seems libraries have popular support: "The main conclusion from this survey is that Minnesotans feel public libraries are important and that library support should be maintained or increased."

So, if libraries have popular support and people are willing to pay for library service, why is it that governmental monetary support for libraries has been decreasing?