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New Study Rejects Link Between Prisons and Economic Growth

A new study examining 25 years of economic data finds that despite the many claims and promises, building prisons in rural communities has had no positive effect on either employment or per capita income. The study by The Sentencing Project examined prison development trends in upstate New York State over the past two decades of record prison expansion, when 38 prisons were built in mostly rural areas.

The report compared rural counties in New York that built prisons since 1982 with those rural counties that did not construct prisons, finding that prisons have produced no advantages to rural areas in either income or unemployment rates. Overall, between 1982 and 2000, per capita income rose slightly higher in non-prison counties (141%) than in those with prisons (132%).

The study also reveals that unemployment levels throughout the economic swings in New York State since 1982 have consistently moved in the same basic directions for both prison and non-prison counties, following overall state trends. In fact, during two of the three distinct economic periods between 1982 and 2001, the non-prison counties performed marginally better than the prison counties.

Prisons have become a growth industry in rural America, with approximately 350 rural counties building prisons since 1980, representing more than half of all new prison construction. This growth has been fueled by harsher sentencing and drug policies that have led to a quadrupling of the prisoner population, along with the availability of relatively inexpensive land in rural communities. Many rural leaders faced with a declining economy have aggressively sought new prison construction, viewing it as a form of economic development. State and local corrections spending overall has increased 601% during this period, with corrections spending becoming the fastest growing component of state budgets for much of the 1990s.

The study outlines a number of possible reasons local counties do not benefit from new prison construction and operation:

Ø Local residents are often not qualified or able to obtain prison jobs;

Ø Job competition from existing prison employees;

Ø Inability of local business and infrastructure to provide prison services;

Ø Multiplier effect fails- prisons do not generate spin-off or "cluster-based economic development."

Previous studies that have analyzed prison job creation have failed to examine, as research from California, Missouri and Washington state shows that most jobs are taken by those outside the prison town itself.

"Despite 20 years of claims by those who have gained financially or politically in building so many prisons, we now know that prisons do nothing to lift rural areas economically in jobs, income or sustainable growth," stated Ryan King, Research Associate at The Sentencing Project. "Their economic claim to fame is that prison construction swells state budgets substantially. Reliance on prisons as an economic tool is at best short-sighted and may lead to limiting local economic growth options."

The study, "Big Prisons, Small Towns: Prison Economics in Rural America," was authored by Ryan S. King, Marc Maier, and Tracy Huling. The Sentencing Project is a national non-profit organization that analyzes criminal justice policy. The report is available to media at

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