California and Nevada credit unions have a combined economic impact equal to that of Kraft Heinz, General Mills and Xerox, according to new research by the California and Nevada Credit Union Leagues and economic consulting firm ECONorthwest.
The research, released Wednesday, found that California credit unions generated $17 billion of economic activity in 2016 and Nevada credit unions generated $803 million of economic activity in 2016.
Job creation, economic contributions, member benefits and community lending were factors in the calculations, as were credit union balance sheets, call reports and operational data, according to the report.
“The economic impact of all credit unions in California and Nevada, both locally headquartered and non-local, is the same as some of the largest corporations in America,” the study reported, citing Kraft Heinz, General Mills and Xerox — each having approximately $17-$18 billion in annual revenue.
“In addition to making a substantial economic impact in the communities they serve, this information reaffirms credit unions’ efforts to empower their members by helping them make wise financial decisions,” California and Nevada Credit Union Leagues President and CEO Diana Dykstra added.
The report noted that California credit unions, which have 10.8 million members, generated the following in 2016:
- $6 billion in direct spending
- Support for 104,861 jobs, including 30,002 directly employed at credit unions
- $1.5 billion in economic benefits from member savings
- $55 billion in mortgage lending (198,000 loans)
- $32.2 billion in auto lending (2 million loans)
- $5.2 billion in credit card lending on 2 million credit cards
- $833 million small business lending (28,000 loans)
Nevada credit unions, which have 513,303 members, generated the following in 2016:
- $803 million in total economic activity and $390 million in direct spending
- Support for 5,453 jobs, including 2,076 directly employed at credit unions
- $54.6 million in economic benefits from member savings
- $1.2 billion in mortgage lending (6,000 loans)
- $917 million in auto lending (57,000 loans)
- $84 million in credit card lending on 51,000 credit cards
- $22 million in small business lending (700 loans)
ECONorthwest said it used a “multiplier-effect” model to extrapolate its conclusions and that it included both locally headquartered institutions and out-of-state institutions with a local presence. Member benefits calculations factored in lower interest rates, higher deposit rates and lower fees.
Earlier this month, ECONorthwest released another report showing that credit unions in Washington and Oregon had a $7.7 billion economic impact in 2016, equivalent to the annual revenue of companies such as Hershey and Mutual of Omaha. That study involved 148 credit unions in those states.
“Performing a high-level, independent economic analysis documents credit unions’ economic impact on communities, and the financial empowerment they provide to members,” Northwest Credit Union Association President and CEO Troy Stang said.
“This leading-edge study will help elected officials and other community groups understand that credit unions’ not-for-profit, cooperative structure inherently holds them accountable to members. This data makes it clear that consumers must always have access to the cooperative financial services model.”
ECONorthwest said it intends to conduct a similar study for the Idaho Credit Union League later this year.