A new economic impact assessment shows that Los Angeles as host of the 2024 Olympic and Paralympic Games could increase economic output by up to $11.2 billion in Los Angeles and $18.3 billion nationwide. A report released Monday also highlights significant legacy benefits of LA 2024’s low-risk Games concept.
The study was commissioned by LA 2024 as required by the International Olympic Committee’s (IOC) candidature process and was conducted by Beacon Economics LLC and the University of California, Riverside School of Business Center for Economic Forecasting and Development. It will be submitted along with the third and final installment of LA 2024’s bid book due to the IOC due by February 3.
The bid committee says that with no permanent construction required to host the Games in L.A., 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 (USD) $10.62 billion and $11.18 billion, additional tax revenues of between $152 million and 167 million, the equivalent of between 74,308 and 79,307 new full-time jobs, direct additional spending of between $6.72 billion and $7.07 billion, and worker earnings of between $4.88 billion and $5.11 billion.
The study projects between $17.4 billion at the lower end and $18.3 billion at the upper end in gross economic output for the United States as a whole, noting 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, offsetting the expected 3 per cent reduction in total visitor numbers.
Los Angeles Mayor Eric Garcetti said at a press conference Monday “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.”
LA 2024 Chairman Casey Wasserman added “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.
“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.”
In November, however, a State group downplayed the potential long-term economic benefits to hosting the Games in 2024. California’s Legislative Analyst’s Office (LAO), a bipartisan group tasked to provide fiscal and policy advice to the Legislature, said the bid offers little long-term benefits to the State’s economy.
Because there are no large infrastructure projects connected with the bid, the report said “accordingly, for Los Angeles, the Olympics probably would not generate much or any long-term economic gain related to new infrastructure.”
It went on to explain that Los Angeles wouldn’t be able to benefit from the additional branding and exposure typically connected with hosting the Games because the world renowned city is “already well known to people and businesses all over the world because it has hosted the Olympics before and appears constantly in films and on television.”
Los Angeles’ bid rival Paris conducted a similar study last year as a required part of the campaign. The economic impact study conducted by the Centre for Law and Economics of Sport (CDES) at the University of Limoges showed that a Paris 2024 Olympic and Paralympic Games could generate 10.7 billion Euros ($11.3 billion) in economic benefits and create more than 250,000 jobs in the Ile-de-France region.
The same report suggested these numbers as a best case scenario, also indicating that the most conservative estimate is 5.3 million Euros ($5.6 billion) and 119,000 jobs and a mid-range impact would produce 8.1 million Euros ($8.6 billion) in economic benefits and 189,000 jobs.
Los Angeles and Paris are competing along with Budapest to host the Games in 2024. The winning city will be elected by the IOC September 13 in Lima, Peru.