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Sports Industry Pulled In $4.1B For LA Economy Last Year, Study Shows

LOS ANGELES ( – Sports events pulled in $4.1 billion for the greater Los Angeles economy last year, according to a sports industry study released Thursday.

Approximately 18.5 million people attended area sports events last year, ranging from major league sports like baseball and basketball, to the L.A. Marathon, according to the three-month study co-sponsored by the L.A. Area Chamber of Commerce and the L.A. Sports Council.

Full-time employment in the industry exceeded pre-recession levels in 2012. The 3,938 jobs in the industry amounted to a 27% rise, in comparison to the previous study conducted in 2009, which calculated a total of 3,103 jobs, the organizations said in a press release.

Researchers say sports pumped $1.7 billion directly into the local economy last year, which, after factoring in the customary economic multiplier provided by a federal government agency, translates into an overall gross economic impact of $4.1 billion. The weighted multiplier of 2.47 was derived from data from the Bureau of Economic Analysis (BEA) and was used to quantify the ripple effect that consumer spending within the sporting events industry has on the overall regional economy.

Alan Rothenberg, chairman of both the Sports Council and the Chamber, said the findings underscore the importance sporting events have on the greater L.A. area.

"The sports industry stimulates economic development, contributes to workforce development and enhances the sense of community. This study validates a fact that we already know to be true... L.A. is a great sports town and will continue to be one," Rothenberg said.

In related findings, 82% of the available tickets to all major league team sporting events in the region - baseball, basketball, hockey, soccer - were sold in 2012.

The direct revenue total is at the exact same level as three years ago when the last study was completed, but is 19% below the pre-recession peak of  $2.1 billion in 2007, according to the findings.

Consistent with previous studies, L.A. County accounted for roughly 71% of the total revenue generated, while Orange County's share of sports-generated revenue was 25% in 2012.

Research driven by media reports futher indicated the four highest paid attendances at single-day sporting events in 2012 were the USC vs. Notre Dame football game played at the Coliseum (93,607), the Rose Bowl Game (91,245), the Auto Club 400 at the Auto Club Speedway (90,000), and the UCLA-USC football game played at the Rose Bowl (83,277).

The results also showed that total attendance has declined since the previous study (18.5 million from 20.8 million).  Possible reasons for the decline cited by the Anderson School were a still struggling economy, rising ticket prices, and improvements in the home viewing experience for many fans.

"Despite the dip in attendance figures, our 18 professional teams sold 82% of all available tickets to events in 2012," said Sports Council President David Simon. "I can't think of many other cities in the country that sell that high a percentage of tickets."

"Last year was exciting for L.A. sports fans with both the Kings and Galaxy bringing home championships. Our professional and college teams and our large-scale annual sporting events continuously serve as a source of pride for this community while contributing to the local economy," said Gary Toebben, president & CEO, L.A. Area Chamber.

A four-person team of MBA graduate students from the UCLA Anderson School of Management conducted the study using data obtained confidentially from 50 local sports organizations.

The study compiled and evaluated aggregate annual revenue, employment, and attendance figures for the calendar year 2012.

It includes professional franchises, sports venues, horse racing tracks, major colleges and universities, as well as annual recurring events such as the L.A. Marathon, the Long Beach Grand Prix and the Rose Bowl Game.

It excludes high school sports and certain special one-time events and does not capture sports-driven revenues from visitors' travel expenditures, retail merchandising, secondary ticket sales or manufacturing of licensed merchandise.  Also not reflected in the study are hundreds of millions of dollars in recent capital expenditures as part of extensive renovations to Dodger Stadium and UCLA's Pauley Pavilion, as well as the cost of construction of the new McKay Center on the USC campus, among others.

This the first study in three years and the eighth overall in a series dating back to 1993.

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