New economic research unveiled at National Press Club: IFA simultaneously launched a...

International Franchise President and CEO Matthew Shay announced during a March 12 press conference at the National Press Club in Washington, D.C. new research findings showing the direct economic output of franchises grew by more than 40 percent to $880 billion in 2005.

[ILLUSTRATION

"Franchising now provides more jobs than many other sectors of the economy, including the durable goods manufacturing and financial activities sectors," said Shay. "It is clear that franchising is a critical engine of economic growth in the United States powering local communities across the country."

The study, The Economic Impact of Franchised Businesses Vol. 2, prepared by PricewaterhouseCoopers on behalf of the IFA Educational Foundation, shows that from 2001 to 2005, franchise businesses have outpaced the economy as a whole in terms of the rate of growth of jobs, payroll and output. In fact, the rate of growth in employment was three times higher for franchise businesses than for the economy as a whole.

The impact of franchised businesses goes beyond direct employment and payroll contributions, the study found. Franchised businesses generate a significant amount of economic activity and stimulate even more economic activity in nonfranchised businesses.

"The economic impact of franchising goes beyond the franchise sector," said Shay. "The spillover effects of franchised businesses on non-franchised businesses included providing 21 million jobs and $660.9 billion of payroll."

Franchised businesses operate in every state, the District of Columbia and in every congressional district in the country. There are more than 900,000 franchised businesses in the country operating in more than 100 lines of business, including automotive, commercial and residential services, quick-service and full-service restaurants, retail food, lodging, real estate, retail products and services, business services and personal services.

View a video of the press conference at www.buildingopportunity.com and read a related article by IFA Vice Pres. Communications and Marketing Alisa Harrison describing the association's new public awareness campaign on page 44.