A study by Economics Research Associates (ERA) shows that Los Angeles hosting the 2016 Winter Olympic Games would have a potential economic impact of $7 billion. The results were calculated in 2007 dollars and based on projected attendance, sponsorship programs, transportation and tourism, among other things.
ERA said the predictions are conservative and accounted only for the Los Angeles region. A Los Angeles 2016 Games would have an additional impact throughout the state and in Nevada.
The study shows that 67,825 full-time equivalent jobs would be created through a combination of positions directly related to the Games and additional staffing needs in related industries such as hospitality.
Los Angeles Mayor Antonio Villaraigosa said, “we all believe in the potential of Los Angeles as the great global city of the 21st century and we all hope to have the opportunity to show the world the beauty and depth of our City. The results of this study speak to the potential transformative impact of the 2016 Olympic Games on the lives and futures of all Angelenos”.
David A. Wilcox, author of the study and financial adviser to several Olympic Games in the United States and abroad, said the bulk of the direct economic impact would benefit the hotel, restaurant, retail and local transportation industries. The ripple effect would spread more broadly throughout the economy.
Barry Sanders, chairman of the Southern California Committee for the Olympic Games (SCCOG) said, “a Los Angeles 2016 Olympic and Paralympic Games would provide a tremendous boost to an already dynamic economy. This financial benefit integrates very well with our Los Angeles bid that brings together so many elements of our community. Ultimately, the combination translates to a spirit and pride that will be fostered during the Games and beyond for many years to come”.
The Mayor added that economic activity spurred by the 2016 Games would also benefit local, state and federal governments through increased hotel occupancy and resulting hotel occupancy taxes, sales taxes, transportation and utility taxes, and ultimately income taxes from increased wages, not included in the economic study. It would add substantially to the already positive financial impact of the Games, he said.
The study estimates that the Games would attract about 877,000 visitors from outside the area, staying an average of about six days each. About half, or 52 per cent, are expected to stay in hotels or other commercial accommodation and the rest would stay with friends or relatives in the area.
According to Wilcox “the estimates are preliminary, conservative and do not presume huge multiplier ratios for induced economic impacts”. He said the figures, for instance, do not include the expected surge in purchases of consumer electronics prior to the Games’ broadcast, or airfares of visitors traveling to Los Angeles for the Games.
