LOS ANGELES – The LA 2024 Olympic and Paralympic Games could increase economic output by up to $11.2 billion in Los Angeles and $18.3 billion nationwide according to a new economic impact assessment, highlighting significant legacy benefits of LA 2024’s low-risk Games concept.
The study was conducted by Beacon Economics LLC and the University of California, Riverside School of Business Center for Economic Forecasting and Development, and was commissioned by LA 2024 as required by the International Olympic Committee’s candidature process. The study will be submitted with LA 2024’s bid book, which is due to the IOC on February 3, 2017.
The economic impact assessment analyzed direct expenditures by a future Los Angeles Organizing Committee for the Olympic Games and visitors to Los Angeles, along with their associated indirect (supplier) expenditures and induced (employee) expenditures. With no permanent construction required to host the Games in LA, tourism and Games operations will be the sole primary drivers of this positive economic impact. The study forecasts that Los Angeles will benefit from:
• increased gross economic output of between $10.62bn and $11.18bn;
• additional tax revenues of between $152m and $167m;
• the equivalent of between 74,308 and 79,307 new full-time jobs;
• between $6.72bn and $7.07bn in direct additional spending; and
• worker earnings of between $4.88bn and $5.11bn.
The study projects between $17.4bn at the lower end and $18.3bn at the upper end in gross economic output for the United States as a whole. It also notes that visitors to the LA 2024 Games are likely to spend roughly double the amount of a normal tourist on a typical visit to Los Angeles, more than offsetting the expected 3% reduction in total visitor numbers.
“There is little doubt that hosting the Olympics is an enormous boost for a local economy—both in the short term as driven by activity surrounding the events themselves, and in the long term given how these events raise the global profile of the region,” said Christopher Thornberg, Founding Partner of Beacon Economics and Director of the UC Riverside School of Business Center for Economic Forecasting and Development. “The worry is always that these benefits come at too high a cost but because Los Angeles already has many of the assets needed for a successful Olympic experience the upside is far greater than it would be for many other cities who would be hosting for the first time.”
LA 2024 released the study at a press conference in Grand Central Market, a vibrant collection of eateries celebrating the diverse cuisines and cultures of LA. The venue – in the heart of the revitalized Downtown LA – was selected as a prime example of the city’s profound transformation since the 1984 Games put Los Angeles on the world map and generated a significant positive economic impact.
Dr. Robert Kleinhenz, Economist and Executive Director of Research at Beacon Economics and the UC Riverside School of Business Center for Economic Forecasting and Development, was joined on stage at the press conference by Los Angeles Mayor Eric Garcetti, LA 2024 Chairman Casey Wasserman, LA 2024 CEO Gene Sykes, LA 2024 Vice Chair and Director of Athlete Relations Janet Evans, LA 2024 Chief Strategy Officer and IOC Executive Board member Angela Ruggiero and Fernando Villagomez – a restaurateur whose thriving eateries have become symbolic of Downtown LA’s recent renaissance.
Owner and chef of Grand Central Market’s Las Morelianas and La Tostaderia restaurants Fernando Villagomez said: “This economic study shows that the Olympic and Paralympic Games will bring opportunity to LA businesses and workers. Small businesses like mine and our employees thrive when Angelenos have a little extra income in their pockets, so the opportunity of bringing new jobs and billions to our economy is very exciting for our community and our city.”
LA 2024 Chairman Casey Wasserman said: “LA 2024’s fiscally responsible approach has reduced risk for the City of Los Angeles and the IOC. Now, in addition to reducing downside, we are able to quantify some really exciting upsides from LA 2024, with $11 billion in economic activity and a new Olympic job sector equivalent in size to LA’s arts and recreation industries combined. And that’s just short term spending through 2024. It doesn’t count the incredible promotional value of bringing the Games to our city. With LA 2024, we are seizing the opportunity to put forward a plan that will serve our city, our communities and the Olympic movement long after the 2024 Games are over.”
Los Angeles Mayor Eric Garcetti said: “In 1984, Los Angeles showed the world that a responsibly managed Olympic Games could add billions of dollars to the local economy and bring progress that could be felt for decades to come — and we’re ready to do that again in 2024. This report shows that L.A. is an ideal, low-risk host for the 2024 Games, and that we have the right plan in place to make sure that a winning bid brings a lasting Olympic legacy back to our city.”