New Study Projects $11 Billion Local Economic Impact from LA 2024

LA 2024’s low-risk Games Plan set to generate significant growth for jobs, labor income, direct spending and tax revenues in LA and nationwide

A photo of downtown LA

The LA 2024 Olympic and Paralympic Games could increase economic output by up to $11.2 billion in Los Angeles according to a new economic impact assessment by Beacon Economics and the University of California, Riverside School of Business Center for Economic Forecasting and Development.

RIVERSIDE, Calif. (www.ucr.edu) — 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 conducted by Beacon Economics LLC and the University of California, Riverside School of Business Center for Economic Forecasting and Development.

The report was commissioned by LA 2024 as required by the International Olympic Committee. The study will be submitted with LA 2024’s bid book, which is due to the IOC on Feb. 3.

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 would be the sole primary drivers of this positive economic impact. The study forecasts that Los Angeles would benefit from:

  • increased gross economic output of between $10.62 and $11.18 billion
  • additional tax revenues of between $152 and $167 million
  • the equivalent of between 74,308 and 79,307 new full-time jobs;
  • between $6.72 and $7.07 billion in direct additional spending; and
  • worker earnings of between $4.88 and $5.11 billion

The study projects between $17.4 and $18.3 billion in gross economic output for the United States. 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 percent 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.

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.

“This economic study shows that the Olympic and Paralympic Games will bring opportunity to LA businesses and workers,” said Villagomez, owner of Grand Central Market’s Las Morelianas and La Tostaderia restaurants. “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.”

Wasserman said the committee’s conservative approach has reduced risk for the city and Olympic Committee.

“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,” Wasserman said. “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.”

Garcetti alluded to the 1984 Olympic Games hosted in LA, saying its success provides a good indicator of impact on the regional economy.

“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,” he said. “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.”

Download the report:

https://www.dropbox.com/s/ixw0kve8bq96uol/UCRiversideEconomicAnalysis.pdf?dl=0

For more information visit www.soba.ucr.edu/centers/forecasting.html and www.beaconecon.com

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