The Economic Importance of Olympic and Paralympic Sport
________________________________________________________________________
Submitted to:
UK Sport
21 Bloomsbury Street,
London,
WC1B 3HF
Submitted by:
Sport Industry Research Centre
Sheffield Hallam University
https://www.shu.ac.uk/research/specialisms/sport-industry-research-centre
September 2017
The Economic Importance of Olympic and Paralympic sport
i
TABLE OF CONTENTS
EXECUTIVE SUMMARY ............................................................................................................................ iii
1. INTRODUCTION .................................................................................................................................... 1
1.1. The project ........................................................................................................................................ 1
1.2. Background ....................................................................................................................................... 1
1.3. Positioning the research .................................................................................................................... 4
1.4. Participation rates ............................................................................................................................. 6
1.5. Report structure .............................................................................................................................. 10
2. METHODS .......................................................................................................................................... 10
2.1. Underpinning methods .................................................................................................................... 10
2.2. Approximation of GVA for the economy as a whole .......................................................................... 11
2.3. Estimation of sport related GVA. ...................................................................................................... 13
2.4. Estimation of sport related employment consumer spending and turnover ....................................... 13
2.5. Distribution of sport estimates across sports .................................................................................... 14
2.6. Calculation of indirect effects in GVA, employment and turnover. ..................................................... 17
2.7. Concluding remarks. ........................................................................................................................ 17
3. ESTIMATION OF SPORT SPECIFIC GVA.................................................................................................. 18
4. SPORT EMPLOYMENT, CONSUMER SPENDING AND TURNOVER ........................................................... 19
5. CASE STUDIES ..................................................................................................................................... 21
5.1 Road cycling ..................................................................................................................................... 21
5.2 Gymnastics ....................................................................................................................................... 24
5.3 New Olympic sports for Tokyo 2020 .................................................................................................. 26
The Economic Importance of Olympic and Paralympic sport
ii
6. INDIRECT EFFECTS IN GVA, EMPLOYMENT AND TURNOVER. ................................................................ 27
7. CONCLUSION ...................................................................................................................................... 30
APPENDIX .............................................................................................................................................. 32
The Economic Importance of Olympic and Paralympic sport
iii
EXECUTIVE SUMMARY
INTRODUCTION
UK Sport commissioned the Sport Industry Research Centre (SIRC) at Sheffield Hallam University to
produce a 'Satellite Account' for Olympic and Paralympic sports, in order to quantify their economic
importance to the UK economy. The methods employed are consistent with the Government’s 2014
estimates for the sport industry as a whole produced by the Department for Culture, Media and Sport.
All developed nations use a System of National Accounts for reporting the economic scale of
industries. National Accounts use an extensive coding system based on hierarchies that cluster
economic activities into increasingly precise categories. A limited definition of sport is identified in a
few of these categories (the statistical definition) with most economic activity diluted within National
Accounts in broadly classified industries such as recreation, manufacturing, and retail.
The Sporting Future policy asks sports to quantify and report on their economic scale and significance,
with employment being a Key Performance Indicator. UK Sport can therefore be seen to be taking an
important leadership role in quantifying the economic scale of Olympic and Paralympic sports.
METHODS
The ‘Economic Importance of Olympic and Paralympic Sport’, is produced using the UK Satellite
Account for Sport (SSA) for 2014 as its base and as a test of reasonableness. The Satellite Account
technique has been used widely in the EU to measure the size of economic sectors that are not
identified explicitly in the National Accounts. The current research into Olympic and Paralympic sport
is the first time that the methodology has been applied to a portfolio of sports. Also it is the first time
that the distinction between 'statistical', 'narrow' and 'broad' definitions of sport as outlined in the
Vilnius Definition
1
of sport has been made in the UK. These three definitions refer to the sport-related
economic activities that can be identified explicitly in the national statistics (e.g. sport facilities); the
economic activities required to play sport (e.g. manufacturing of sport equipment); and, the economic
activities that use sport as an input in the production process (e.g. sport betting) respectively.
Satellite Accounts analyse industries from four perspectives:
Gross Value Added (GVA);
Employment (head count and full time equivalent jobs);
Consumer spending, and
Turnover.
In addition, indirect effects (associated with the underlying supply chain activity) are calculated in the
cases of GVA, employment and turnover giving a comprehensive economic impact for Olympic and
Paralympic sports.
Certain sports such as golf, tennis, football and rugby were excluded because the Olympic and/or
Paralympic Games are not the pinnacle of achievement in these sports. The five new sports for Tokyo
2020 are included to enable like for like comparisons to be made in future updates of this study.
Four main sources are used to acquire the relevant data:
1
The Vilnius Definition of sport is explained in sections 1.2, 1.3 and 2.1 of the main report.
The Economic Importance of Olympic and Paralympic sport
iv
National data sets (for example the Annual Business Survey and Annual Survey of Hours and
Earnings);
Sport participation datasets such as the Active People Survey and the Taking Part Survey,
Analysis of company accounts (almost half a million businesses with an income and
expenditure statement); and
The 2014 Input Output Tables and the most recent Analytical Tables for the UK economy.
KEY FINDINGS
Gross Value Added (GVA)
2
The Gross Value Added of Olympic and Paralympic sports in the UK was £18,900 million in 2014 with
the largest single area being summer Olympic sports, generating £16,104m (85%) of this GVA. The
GVA of Olympic and Paralympic sport is equivalent to 55% of the whole sport industry, as estimated by
DCMS. The GVA is largely a function of the pattern of participation (or demand) among sports. For
this reason, the sector is driven by Athletics, Swimming and Cycling. When both direct and indirect
effects are taken into account, the importance of the sector increases to £29,979m.
GVA £m
Statistical
Definition
Narrow
Definition
Broad
Definition
Summer Olympic sport
12.6%
£9,265
57.5%
£16,104
100%
Winter Olympic sport
16.9%
£374
55.1%
£678
100%
Paralympic sport
10.4%
£1,110
53.2%
£2,085
100%
Total direct effect
12.5%
£10,749
57.0%
£18,867
100%
Total direct and indirect effect
£29,979
Employment
The Olympic and Paralympic sector provides employment for 623,000 people (head count). This is
equivalent to 480,000 full-time equivalent employees when adjusted for part-time workers. The
sector generates employment equivalent to 55.7% of all sport employment (DCMS) and 2.1% of total
employment nationally. Most employment occurs in Olympic summer sport followed by Paralympic
sport and Olympic winter sport. When the indirect effects are taken into account, the sector
generates approximately one million jobs.
Employment
(head count)
Statistical
Definition
Narrow
Definition
Broad
Definition
Summer Olympic
sport
68,600
12.9%
326,000
61.2%
532,500
100%
Winter Olympic
sport
3,900
18.8%
12,700
61.2%
20,700
100%
Paralympic sport
7,300
10.5%
38,800
55.5%
70,000
100%
Total direct
79,800
12.8%
377,500
60.6%
623,200
100%
Total direct and
indirect effect
1,018,000
2
Gross Value Added measures the contribution to the economy of each individual producer, industry or sector in the UK, and approximates to the sum
of gross profits and wages/salaries.
The Economic Importance of Olympic and Paralympic sport
v
Consumer spending
Consumer spending on Olympic and Paralympic sport in the UK was found to be £19,766 million which
is equivalent to £306 per head of population over the year 2014. This is equivalent to 1.7% of overall
household spending. Almost a quarter of consumer spending on sport is located in the statistical
definition of sport (as opposed to the narrow or broad definitions), which is a considerably higher
percentage than in the cases of GVA and employment.
Consumer
spending £m
Statistical
Definition
Narrow
Definition
Broad
Definition
Summer Olympic
sport
£4,357
26.3%
£11,054
66.8%
£16,540
100%
Winter Olympic
sport
£247
22.8%
£783
72.2%
£1,085
100%
Paralympic sport
£468
21.9%
£1,379
64.4%
£2,141
100%
Total
£5,072
25.7%
£13,216
66.9%
£19,766
100%
Turnover
Turnover, or the total economic activity associated with Olympic and Paralympic sport is also
comprised of: direct effects such as the operation of clubs; and indirect effects, such as supply chain
activity. The turnover associated with these effects on Olympic and Paralympic sport is £73,408
million as indicated below. Almost half of the turnover identified is produced indirectly through the
supply chain.
Turnover £m
Statistical Definition
Narrow Definition
Broad Definition
Summer Olympic
sport
£5,686
18.2%
£18,698
59.8%
£31,277
100%
Winter Olympic
sport
£323
24.0%
£777
57.7%
£1,347
100%
Paralympic sport
£611
15.2%
£2,229
55.5%
£4,015
100%
Total direct
£6,620
18.1%
£21,704
59.2%
£36,639
100%
Total direct and
indirect effect
£73,408
The sporting context
The value of sport as a whole in the UK has been reported by the Department for Culture, Media and
Sport using the Satellite Account methodology. Comparing our Olympic and Paralympic data with the
DCMS' overall sport data reveals that Olympic and Paralympic sport is the main component of the
sport industry accounting for: 55% of the sector's GVA and 55.7% of its employment. As shares of the
national economy, Olympic and Paralympic sport generates 1.2% of GVA, 2.1% of employment and
1.7% of consumer spending respectively. Olympic and Paralympic sport is an industry which is larger
than three entire sectors of the UK economy, notably the agriculture, forestry and fishing industry.
The Economic Importance of Olympic and Paralympic sport
vi
Measure
Olympic and
Paralympic
sport (2014)
Sport (2014)
% of the sport
economy
% of the
UK economy
GVA
£18.87 billion
£34.30 billion
55.0%
1.2%
Employment
623,000
1,119,000
55.7%
2.1%
Consumer
spending
£19.77 billion
n/a
n/a
1.7% (households)
Turnover
£36.64 billion
n/a
n/a
1.2%
Conclusion
This report has shown that Olympic and Paralympic sport is fundamental in creating GVA and
employment within the overall sport industry, accounting for the majority of the output produced. Its
contribution to employment at 2.1% is much higher than the contribution of GVA (1.2%) implying that
growth in Olympic and Paralympic sport will result in an accelerated rate of growth in employment so
long as the supply side infrastructure flexes to accommodate increased demand. In addition, this
report is the first example of the UK sport industry being analysed separately by the three component
parts of the Vilnius Definition of sport.
Generally the statistical definition for GVA, employment and turnover ranged between 12% and 18%.
However, in the case of consumer spending the statistical definition was much higher at 25.7%, which
reflects the economic importance of charges for taking part in sport. Future research on the
economics of sport should investigate the significance of sport volunteering, which is not included in
the Vilnius Definition, and the growth in sport employment. The five outcome areas of Sporting Future
also require research into the social value of elite sport and this is underway in complementary
research.
The UK now has a transparent audit trail of evidence by which to value the economic importance of
Olympic and Paralympic sport, which is consistent with the DCMS's Sport Satellite Account. This
position represents a strong basis from which to monitor the development of Olympic and Paralympic
sport in future years.
The Economic Importance of Olympic and Paralympic sport
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1. INTRODUCTION
1.1. The project
In response to the Government's new strategy for sport, Sporting Future
3
, UK Sport commissioned the
Sport Industry Research Centre (SIRC) to quantify the economic importance of Olympic and Paralympic
sport for the year 2014. Sporting Future recognises the contribution of sport to wider social outcomes
such as physical and mental wellbeing; individual development, community development and
economic development. The rationale for being consistent with Government policy is captured
succinctly in the quote below:
The economic impact of sport, how it creates jobs, promotes growth and drives exports is a
fundamental part of this new strategy. We will ask organisations to consider not just how they
contribute to the nation’s health or wellbeing, but to the economy as well, both nationally and locally.
[Sporting Future, page 77]
The year 2014 was chosen as the base for the research for two key reasons. First, there is existing
research on the economic value of sport as a whole to the UK economy in the form of a Satellite
Account for Sport published by DCMS for 2014, which is recognised as an Official Statistic. It follows,
that Olympic and Paralympic sport is a subset of all sport, and therefore as a test of reasonableness we
would expect the economic importance of Olympic and Paralympic sport to be a proportion of the
overall total for sport. The research challenge therefore, was to produce a credible estimate for
Olympic and Paralympic sport that was consistent with the overall Satellite Account for Sport.
Second, 2014 is the latest year for which all of the data required to produce the Olympic and
Paralympic Satellite Account are available and therefore for pragmatic reasons it was not possible to
produce a more contemporary version. The 2014 Olympic and Paralympic Satellite Account is the
midpoint of the London 2012 and Rio 2016 Olympic and Paralympic cycles and is also the year of the
Sochi 2014 Winter Olympics and Paralympics.
1.2. Background
Developed nations use an internationally standardised framework known as the System of National
Accounts (SNA) to report the economic scale of specific industries. Outlines of the structure of the
UK's National Accounts and an insight into Section A (Agriculture) are shown in Table 1.
Table 1: The structure of the UK's National Accounts
Structure
Number
Abbreviated Examples
Sections
21
A: Agriculture, forestry and fishing
Divisions
88
01: Crop and animal production
Groups
272
01.1 Growing of non-perennial crops
Classes
615
01.11 Growing of cereals
Sub Classes
191
No sub classes to 01.11
3
HM Government (2015) Sporting Future: A New Strategy for an Active Nation, (HM Government), London.
The Economic Importance of Olympic and Paralympic sport
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The four digits used for the 615 'Classes' shown in Table 1, for example 01.11, are commonly known as
Standard Industrial Classification codes or SIC codes.
Sport, in its totality, is not recognised as an industry within the framework of National Accounts.
However, as will be shown later, sport and sport-related economic activity is found to varying extents
in 182 out of 615 SIC codes. Throughout Europe, the method used to identify sport’s contribution to
the economy is the production of a 'Satellite Account'. The Satellite Account technique was developed
by the United Nations to measure the size of economic sectors that are not defined as specific
industries in the National Accounts, but which are clearly linked to the economy. In the UK there is a
tourism Satellite Account, a Satellite Account for sport (SSA), and more recently a Satellite Account for
golf. Satellite Accounts usually analyse industries from four perspectives.
Gross Value Added (GVA), which is the core of the National Accounts, and is defined as the
profits plus wages within an industry, less an adjustment for taxation and subsidies. GVA is a
proxy for Gross Domestic Product (GDP), the key measure of the scale of an economy.
Employment is reported as a head count of employees and the self-employed to quantify the
number of workers, and as Full Time Equivalents to quantify the number of jobs.
Consumer spending, which is defined as the spending of individuals and households on sport-
related goods and services.
The fourth, less commonly used measure is turnover, which captures the revenue flows associated
with a given level of GVA. In order to generate £1,000 in wages and profits it might be necessary for a
business to have a turnover of £1,800. This would include spending on all of the inputs required in the
production process. Turnover is estimated by using appropriate industry specific ratios derived from
the Input-Output Tables (IOT) of the UK.
To date UK Sport's strategy has been to use its resources to support Olympic and Paralympic sports in
order to achieve medal success. According to UK Sport's 'Investing in Sport' principles:
At the heart of our investment approach is our philosophy of targeted investment to support all credible
medal potential within the high performance system. This approach focuses the resources available
towards athletes and sports with the greatest chance of succeeding on the world stage, across an eight
year pathway……This approach, along with record levels of investment from the National Lottery,
Exchequer and Team 2012 helped Great Britain achieve 67 Olympic medals and 147 Paralympic medals
at Rio 2016 and four Olympic and six Paralympic medals at Sochi 2014
4
.
Prior to Sporting Future, there was no explicit requirement for sports to quantify and report on their
economic scale and significance. The new policy direction requires taking a different perspective on
the 'performance' of sport and to use a rather different vocabulary. UK Sport can therefore be seen to
be taking an important leadership role in quantifying the economic scale of Olympic and Paralympic
sport. As the distributor of £345m in the Tokyo cycle and a further £30.5m in the PyeongChang cycle it
is of value to UK Sport and the national governing bodies of sport it supports, to know the economic
significance of their activities. For the purposes of clarity, the key performance indicator stated in
Sporting Future for measuring economic development through sport is employment as estimated in
the Department for Culture, Media and Sport's Sport Satellite Account:
4
http://www.uksport.gov.uk/our-work/investing-in-sport
The Economic Importance of Olympic and Paralympic sport
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Key Performance Indicator 16: Employment in the sport sector (from the Sport Satellite Account)
Employment is however but one measure and this research goes beyond employment to include Gross
Value Added, consumer spending, and turnover.
The research aims of this report are to:
Outline the economic groupings in the UK's System of National Accounts which contain
Olympic and Paralympic sport activities;
Estimate the GVA for each Olympic and Paralympic sport;
Estimate employment for each sport;
Estimate the associated consumer spending on these sports using the Vilnius Definition of
sport (see explanation later);
Estimate turnover for each sport; and
Contextualise the research relative to the DCMS's 2014 Satellite Account for Sport.
The ‘Economic Importance of Olympic and Paralympic Sport’, is produced using the UK Satellite
Account for Sport (SSA) for 2014 as its base and as a test of reasonableness. The 2014 SSA estimates
the GVA and employment generated by the UK's sport economy to be £34.3bn and 1.119 million jobs
(head count) respectively, which values the sport economy at 2.1% of total UK GVA and 3.6% of
employment. The UK SSA is explicitly constructed to be consistent with the internationally agreed
'Vilnius Definition' of sport
5
which provides the most conceptually robust description of the sport
industry.
The focus of this research is on those sports for which the Olympic and Paralympic Games are the
pinnacle of sporting achievement. Consequently we have excluded four Olympic sports in golf, tennis,
football and rugby because the Olympic Games is not the pinnacle of achievement in them. Other
popular sports such as motorsport, snooker and cricket are also excluded because they are not
Olympic or Paralympic sports. However, in order to replicate the study meaningfully in future years,
we have included in the analysis the five new sports for Tokyo 2020, namely: baseball / softball;
climbing; karate; skateboarding; and surfing.
Table 2 shows the headline findings from the research. The total GVA generated by Olympic and
Paralympic sport is approximately £18.9 bn. It equates to 55% of the overall sport GVA and 1.2% of
total GVA for the economy as a whole, generating approximately 623,000 jobs. Olympic and
Paralympic employment is equivalent to 2.1% of total employment, highlighting sport's capacity to
generate jobs at a greater rate than suggested by its GVA share of the economy. This, as Table 2
illustrates, is equivalent to 56% of the overall sport employment detailed in the UK SSA.
5
http://ec.europa.eu/eurostat/documents/6921402/0/Vilnius+Definition+Sport+CPA2008+official+2013_09_19.p
df/30838d11-01ea-431f-8112-50786e187c1c
The Economic Importance of Olympic and Paralympic sport
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Table 2: Value of Olympic and Paralympic Sport, UK 2014
Indicators
Units
Olympic and Paralympic GVA
£18.9 billion
Olympic and Paralympic GVA as % of sport GVA:
55.0%
Olympic and Paralympic GVA as % of total GVA:
1.2%
Olympic and Paralympic GVA, employment
623,000
Olympic and Paralympic employment as % of sport employment
55.7%
Olympic and Paralympic employment as % of total employment
2.1%
1.3. Positioning the research
In 2006, an initiative of the Austrian EU Presidency led to the development of a framework for Sport
Satellite Accounts and the establishment of an EU Working Group on Sport & Economics (WG). The
first meeting of the group took place in Vienna on 27 and 28 September 2006 at the invitation of the
Austrian government.
There was consensus in Vienna that the activities of the WG would have three main purposes:
To measure the sport sector as a percentage of GDP and the effects of sport on employment,
value added, and purchasing power in the Member States as well as at EU level;
To measure the dynamics of the sport sector over time; and
To have reliable data as a basis for future decision-making relevant to the sport sector.
In most EU member states, in the absence of an SSA methodology, the contribution of sport to the
economy is significantly underestimated. Basic statistical publications by many Member States contain
no information on the sport sector at all, yet studies in those nations which have used the SSA
approach indicate that sport makes a considerable and growing contribution to their economies. Since
the System of National Accounts in each country focuses on a small fraction of what is generally
understood to be sport, the contribution of sectors other than those explicitly addressed is generally
ignored. For instance, sport plays an important role in retail trade and tourism; however the sport
industry does not receive recognition for this role in terms of GVA or employment as the relevant data
are reported in different areas of the National Accounts. This finding implies that there is a
discrepancy between the statistical reporting of the sport sector within National Accounts and the
common understanding of what constitutes sport activities. For this reason, the WG set out to
encourage Member States and the EU as a whole to derive better statistical data on sport. To achieve
this aim, it was decided that it would be useful to create a Sport Satellite Account in the Member
States and, at a later stage, the EU as a whole.
To date seven countries (Austria, Cyprus, Germany, the Netherlands, Poland, Lithuania and the UK)
have produced a Sport Satellite Account (SSA). The UK is the only country to have produced a SSA for
most years since 2004 and it is now produced annually by the Office for National Statistics. The latest
year we have confirmed data for is 2014, which provides the background test of reasonableness for
the current study into Olympic and Paralympic sport.
The Economic Importance of Olympic and Paralympic sport
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To complement the UK SSA, we have derived a methodology for providing estimates of the economic
importance of sport for specific sports that are consistent with the SSA. In this sense, the most
important development has been the SSA for Golf
6
in the UK and the Republic of Ireland
7
. The key
findings in both reports were centred on GVA, employment, consumer spending and turnover. The
approach used was transparent, replicable and consistent with the UK's National Accounts.
Underpinning these applications of the Sport Satellite Account methodology is the 'Vilnius Definition'
of sport which has been used to determine the Standard Industrial Classification (SIC) codes of
economic activities which are associated with sport. The Vilnius Definition has been the common
denominator across all SSA research in Europe. As the WG policy paper on SSAs has underlined, at the
European level, economic activities are measured within a specific statistical nomenclature called
NACE (Nomenclature statistique des Activités économiques dans la Communauté Européenne). Within
it, NACE category 93.1 "Sporting Activities" is identified as the core 'statistical definition' of sport in the
National Accounts. This category includes sport facilities for participation and spectating purposes as
well as the activities of professional and community clubs. Sport is contained within Section R of the
UK's National Accounts and a breakdown of the Section as a whole and the SIC codes relevant to sport
are listed below.
Section R Arts, Entertainment and Recreation
90 Creative arts and entertainment activities
91 Libraries, archives, museums and other cultural activities
92 Gambling and betting activities
93 Sports activities and amusement and recreation activities
93.1 Sports activities
93.11 Operation of sports activities
93.12 Activities of sport clubs
93.13 Fitness facilities
93.19 Other sports activities
93.19/1 Activities of racehorse owners
93.19/2 Other sports activities not elsewhere classified
However, to limit the sport sector to Division 93 of the Nation Accounts is quite arbitrary from an
economic point of view. Another, conceptually better, definition of the economic sport sector
encompasses all industries which produce goods that are necessary to play sport. In addition to sport
facilities, this definition includes, for example, manufacturing of sport clothing and footwear as well as
sports equipment. The latter definition (together with the statistical definition) is referred to as the
‘narrow definition of sport’. In addition to these two measures, the so-called ‘broad definition of
sport’ includes not only the statistical definition and the narrow definition, but also relevant parts of
6
SIRC: A Satellite Account for Sport in the UK, 2016, a research supported by the R&A
(http://www.sportsthinktank.com/uploads/economic-impact-of-golf.pdf)
7
SIRC: A Satellite Account for Golf in the Republic of Ireland, 2016, a research supported by the R&A and CGI,
(https://www.golfnet.ie/News%20Listing%20Assets/CGI%20Report%20Economic%20Impact.pdf
The Economic Importance of Olympic and Paralympic sport
6
the industries for which sport is an important input for their production processes, e.g. television
broadcasting. It is this broad definition of sport that has been reported in SSAs to date. The Vilnius
Definition was updated in a Pan European workshop organised by the European Commission, SIRC and
SpEA in Brussels, in 2017. This report on Olympic and Paralympic sport, divides all the major outputs
into 'statistical', 'narrow' and 'broad' definitions of the sport industry. To the best of our knowledge
this is the first time that separate identification of the three components of the Vilnius Definition of
sport has been attempted in the UK. The distribution of the sport-related economic activities among
the three definitions can be seen in full in Table A1 of the Appendix ('Mapping of the UK Olympic and
Paralympic sport industry'). Of the 615 SIC codes that comprise the UK's National Accounts, sport-
related activity was found in 182 of them. Of these 182 SIC codes: 4 relate to the statistical definition;
85 relate exclusively to the narrow definition; and, 93 relate exclusively to the broad definition. All of
the economic activity found in the statistical definition relates directly to sport. By contrast, for the SIC
codes in the narrow and broad definitions only a proportion of the economic activity relates to sport.
1.4. Participation rates
Participation data were used to derive an estimate for the number of participants in each sport, which
has been used subsequently as one of the determinants of the economic scale of a sport. Two
frequencies were considered: at least once a week and at least once every four weeks using the results
from two national surveys: the Active People Survey (APS) and the Taking Part Survey (TPS).
The most appropriate participation rates for the year 2014 were found in APS 2013/14 (each 12 month
wave starts in October) and TPS 2014/15 (each 12 month wave starts in April). When comparing the
participation rates between APS and TPS, it became obvious that TPS reports marginally higher
participation rates than APS, across almost all popular sports. After reviewing the questionnaires and
the methods employed to collect the data, we propose three possible explanations for the variances.
1. TPS is a face to face survey conducted in the home whilst APS is conducted via telephone.
2. A typical TPS interview lasts an average of 45 minutes compared with 18 minutes in the case of
APS.
3. TPS uses 'showcards' to list activities on a screen that the interviewee can see, whereas APS
asks open questions which depend upon memory recall. The advantage of showcards over
open questions is that they provide prompts that assist memory recall.
For well-established sports, we have adopted the TPS estimates as more reliable estimates of
participation (or 'demand'). However APS has an important role to play because its large sample size
of c. 150,000 respondents per wave helps to identify the scale of demand for less popular sports.
Finally, we chose participation at a frequency of 'once every four weeks' in favour of 'once a week'.
The rationale for this decision is because we consider that a lot of the economic activities associated
with sport (such as spending on membership fees, clothing and equipment) would be 'triggered' by a
simple participation decision without having to commit to a more intensive frequency of participation.
Table 3 details the participation rates for adults (16 years old and above). Where possible children's
participation rates were also taken into account using the Taking Part Children's Survey, as it was
found that a considerable amount of commercial activity is driven by children's participation (e.g. in
gymnastics). Paralympic sport participation rates are based on APS and TPS data. Some Paralympic
sports are identified explicitly within the surveys, notably:
The Economic Importance of Olympic and Paralympic sport
7
Wheelchair archery;
Wheelchair basketball;
Wheelchair tennis;
Powerlifting;
Wheelchair table tennis;
Wheelchair rugby and
Boccia.
To derive participation rates for the remaining Paralympic sports that were not identified separately,
we applied a filter to the overall dataset (for each sport). This filter included all respondents who
reported having visual, hearing, mobility, breathing and dexterity disabilities. Once this filter was
applied, it was possible to separate out estimates for participation rates in each Paralympic sport and
then to subtract this figure from the corresponding Olympic sport participation rate. Sports using this
method included: Alpine skiing; athletics; badminton; canoe; cycling; equestrian; football; judo;
rowing; sailing; shooting; volleyball; snowboarding; swimming; wheelchair curling, and wheelchair
fencing.
Amongst the Olympic sports, the highest participation rates are found in athletics, cycling, swimming
and children's gymnastics, with all of them exceeding the 5% mark. Winter Olympic sports have lower
participation rates, with the highest being ice-skating (0.67% adults, 3.0% children). In Paralympic
sports, swimming, cycling and athletics have highest adult participation rates at 1.6%, 0.8% and 0.4%
respectively. It is important to note that the sum total of participants is not the same as the number of
unique participants. There are some people who participate in more than one sport and who will be
counted multiple times. However, the approach of counting participants per sport is appropriate
because even those who take part in multiple sports will still have to pay to participate and to
purchase the necessary equipment and clothing.
The Economic Importance of Olympic and Paralympic sport
8
Table 3: Participation rates, Olympic and Paralympic Sports, 2014
Olympic Sport
Adult
participation
Child
participation
Adult
participants
Child
participants
Archery
0.33%
173,064
Athletics
8.30%
6.12%
4,355,238
466,748
Badminton
2.29%
2.23%
1,202,499
164,069
Basketball
1.08%
4.02%
565,125
307,324
Boxing
0.79%
1.60%
414,304
130,031
Canoeing (or rowing in children)
0.61%
0.46%
318,045
66,937
Cycling BMX
0.16%
84,996
Cycling Mountain Bike
1.75%
917,762
Cycling Road
3.35%
1,756,858
Cycling Track
0.17%
89,664
Cycling in children
24.05%
1,770,160
Swimming/Diving
13.81%
39.04%
7,242,985
2,804,878
Equestrian Dressage
0.13%
68,177
Equestrian Jumping
0.11%
57,688
Equestrian – combined
0.86%
2.03%
451,014
278,429
Fencing
0.05%
26,222
Gymnastics (& trampoline in children)
0.26%
10.34%
136,353
840,327
Handball
0.02%
12,062
Hockey
0.33%
1.40%
173,064
113,777
Judo, (or martial arts in children)
0.07%
6.10%
36,710
458,993
Rowing
0.46%
241,240
Sailing
0.37%
192,450
Shooting
0.78%
406,572
Table Tennis
1.74%
3.95%
913,108
297,284
Taekwondo
0.09%
47,199
Trampoline
0.08%
41,955
Triathlon
0.15%
78,665
Volleyball
0.36%
0.49%
189,561
37,249
Water Polo
0.03%
15,733
Weightlifting
2.28%
1,195,713
Wrestling Freestyle
0.004%
2,098
Wrestling Greco-Roman
0.004%
2,098
Baseball and softball
0.05%
0.90%
26,222
73,143
Karate
0.21%
110,131
Skateboarding
0.10%
52,444
Climbing
0.72%
377,593
Surfing
0.20%
104,887
The Economic Importance of Olympic and Paralympic sport
9
Winter Olympic Sport
Alpine Skiing
0.22%
115,376
Free Style Skiing
0.05%
26,222
Cross Country Skiing
0.01%
5,244
Curling
0.02%
12,551
Ice Skating
0.67%
3.1%
351,371
251,935
Ice Hockey
0.03%
15,733
Nordic Combined
0.05%
26,222
Snowboard
0.06%
31,466
Paralympic Sport
Skiing
0.02%
9,831
Athletics
0.37%
0.38%
193,802
30,622
Badminton
0.17%
0.21%
87,612
17,162
Boccia
0.01%
3,671
Canoe (or rowing in children)
0.07%
0.04%
38,571
2,955
Wheelchair Archery
0.01%
3,289
Cycling
0.76%
2.22%
399,162
180,309
Equestrian
0.07%
0.31%
37,173
25,519
Football
0.29%
3.29%
149,657
267,661
Judo (or martial arts in children)
0.02%
0.45%
12,888
36,751
Power lifting
0.02%
10,489
Rowing
0.02%
11,190
Sailing
0.11%
59,279
Shooting
0.14%
75,909
Sitting Volleyball
0.01%
0.03%
4,480
2,573
Swimming
1.56%
4.53%
817,586
367,884
Table Tennis
0.11%
0.29%
57,097
23,731
Taekwondo
0.01%
4,599
Triathlon
0.01%
4,608
Wheelchair Basketball
0.07%
0.24%
37,975
19,380
Wheelchair Curling
0.01%
3,086
Wheelchair Fencing
0.01%
5,011
Wheelchair Tennis
0.14%
0.40%
73,112
32,810
The Economic Importance of Olympic and Paralympic sport
10
1.5. Report structure
The rest of the report is structured as follows:
Section 2 outlines the methods employed, including the construction of a 'sport grid' for the
distribution of GVA and employment among sports;
Section 3 outlines the estimation of sport specific GVA;
Section 4 provides estimates for: employment, consumer spending and turnover in Olympic
and Paralympic sports;
Section 5 presents case studies on cycling, gymnastics and the five new Olympic sports;
Section 6 examines the indirect effects on GVA, employment and turnover;
Concluding comments are presented in section 7; and
the Appendices provide more detailed data on the headlines included in the main body of the
report.
2. METHODS
2.1. Underpinning methods
The estimation of the Olympic and Paralympic SSA involved undertaking a systematic sequence of
tasks as outlined below.
Approximation of GVA and employment in the economy as a whole according to four digit SIC
codes.
Estimation of 'sport shares' in GVA leading to sport-related GVA and employment.
Estimation of full time equivalent sport employment, by using full time employment statistics.
Estimation of consumer spending (households) and turnover using appropriate ratios from the
National Accounts.
Distribution of sport related GVA, employment, consumer spending and turnover across sports
to derive the Olympic and Paralympic sport components.
Classification of all the sport estimates according to the statistical, narrow and broad definition
(as defined within the Vilnius Definition of sport).
Estimation of indirect effects in GVA, employment and turnover.
Our analysis is consistent with the Vilnius Definition of sport, which articulates the consensus reached
at European Union level and which included the active participation of the UK
8
. The research
presented in this report uses the key sources listed below as its basic inputs.
1. Examination of the commercial sector through the annual financial statements of sport-related
businesses filed with Companies House.
8
SpEA, SIRC, Statistical Service of Republic of Cyprus, Meerwaarde Sport en Economie, FESI, Ministry of Sport
and Tourism of the Republic of Poland (2012). Study on the Contribution of Sport to Economic Growth and
Employment in the EU. Research Report. European Commission, Directorate-General Education and Culture.
(http://ec.europa.eu/sport/library/studies/study-contribution-spors-economic-growth-final-rpt.pdf)
The Economic Importance of Olympic and Paralympic sport
11
2. Analysis the finances of sports clubs through annual financial statements and other data in the
public domain.
3. The trade of goods as reported by Her Majesty's Revenue and Customs (HMRC).
4. Annual financial statements for governing bodies, associations and charities.
5. Participation data for Olympic and Paralympic sports through APS, TPS and TPCS.
6. The Input-Output Tables for the national economy, together with data concerning average
earnings provided by the Annual Survey of Hours and Earnings which is used to estimate the
number of employees in each SIC activity.
7. ONS data for number of self-employed people in SIC code groups.
This method represents the first attempt to disaggregate an existing estimate for GVA and
employment for sport as a whole to its constituent sports. The method is transparent making it
possible to revise and update the estimates in the future.
2.2. Approximation of GVA for the economy as a whole
GVA must be approximated for economic activities in the Vilnius Definition of sport at the four-digit
SIC code level. The National Accounts are presented at a two-digit level, making such an
approximation a necessary first step in the calculations. To illustrate this point, Table 4 below shows,
as an example, an extract of the economic activities analysed in this research, which contribute, in
part, to the output generated by sport:
For each of the economic categories used, (such as 94.12 or 94.11 in Table 4) we computed a GVA
estimation (reflecting the economy as a whole, not just sport). As an example, in the economic
category 96.09, the four digit GVA detail can be approximated through the use of the Annual Business
Survey (which has such detail available).
By using:
ABS (96.09): GVA £5,615 million;
ABS (96): GVA £10,437 million, and
IOT (96): GVA £16,736 million
an estimate of overall GVA for the sector 96.09 can be derived as:
[ABS(96.09) / ABS(96)] * IOT(96).
In the example above, the estimated GVA for the sector 96.09 equals £9,003.8 million:
(5615/10437)*16736. In other words, the share suggested by ABS (of 96.09 as a subset of 96) is
applied to the Input Output Tables (IOT), making the final estimate consistent with national statistics.
A total of 182 economic activities were analysed in this way. After deriving the overall GVA for each of
the code specific economic activities, we proceeded to estimate the share of GVA attributable to each
Olympic and Paralympic sport.
The Economic Importance of Olympic and Paralympic sport
12
Table 4: Sample economic activities used in the analysis
SIC
codes
Economic activity
Sport content (examples)
Definition and sport
percentages
93.11
Operation of sports facilities
Sports facility operation services;
Operation of swimming pools and
stadiums; Operation of other
sports arenas and stadiums
Statistical, 100%
93.12
Activities of sport clubs
Services of sport clubs;
Statistical, 100%
93.13
Fitness facilities
Services of fitness facilities
Statistical, 100%
93.19
Other sports activities
Services of athletes; Support
services related to sports and
recreation; Other sports and
recreational sports services;
Sports and recreational sports
event promotion services
Statistical, 100%
93.29
Other amusement and
recreation activities
Services of marinas, ski services,
table football games, coin-
operated machines for car racing
games
Narrow, 30%
94.11
Activities of business and
employers memberships
organisations
Operation of sports facilities
Narrow, 1%
94.12
Activities of professional
membership organisations
Teaching swimming life-saving and
survival techniques.
Broad, 3%
95.23
Repair of footwear and
leather goods
Sport repairs
Narrow, 10%
95.29
Repair of other personal and
household goods
Refurbishment and selling of
donated bicycles.
Narrow, 30%
96.04
Physical well-being activities
Fitness clubs
Narrow, 10%
96.09
Other personal service
activities
Operation of professional football
clubs together with related and
ancillary activities.
Narrow,10%
The Economic Importance of Olympic and Paralympic sport
13
2.3. Estimation of sport related GVA.
For the current research the DCMS's SSA is taken as the basis upon which any sport-specific SSA can be
built. The task here is to analyse the sport sector in such a way as the total sport related GVA
(£34.3bn) can be reproduced within an acceptable tolerance level (+/-5%) and broken down into the
constituent parts of the Vilnius Definition of sport. Although some elements of the Vilnius Definition
of sport are 100% sport (the statistical definition), the 'narrow' and the 'broad' definitions (as
explained in the introduction) include activities in which only a proportion of the total is eligible sport-
related economic activity. For this part of the project, the data inputs are provided primarily by:
the annual reports of limited companies filed with Companies House (CH) and processed
through the 'Financial Analysis Made Easy' (FAME) database;
the Annual Business Survey;
the Input Output Tables provided by the Office for National Statistics (ONS); and
The overall GVA estimates of the previous step.
Through the analysis of annual reports by Standard Industrial Classification (SIC) code a sport
percentage can be assigned to the sport-related component in each relevant economic activity. This is
a critical element in the calculation of sport GVA and its subsequent allocation across the portfolio of
Olympic and Paralympic sports. This highly detailed distribution of GVA should be regarded as a
pragmatic device by which to generate aggregate values for each sport, rather than as a publishable
statistical output with the status of an Official Statistic. The four digit SIC codes that were found to be
relevant to the generation of GVA and employment, for Olympic and Paralympic sports, are listed in
Table A.1 of the Appendix.
The important point of note here is that these derived shares provide an overall estimation of sport-
related GVA that is consistent with the DCMS data. This finding should provide strong reassurance
about the validity of the method we have used.
In the case of category 96.09, by multiplying the sport share (in this case around 9%) by the estimated
GVA for the code as a whole, we computed the sport generated GVA that is associated with this
particular economic activity.
After calculating the sport GVA for each of the relevant activities, we identified a total sport GVA of
£33.8bn. This is very close (98.5%) to the output figure of £34.3bn for 2014 published by DCMS. By
making a small proportional adjustment of 1.5%, all the code-specific sport GVAs have been adjusted
to match the DCMS total. This approach ensures that the method used is valid and consistent with
values stated in both the National Accounts and the Sport Satellite Account. A further benefit is that
that the model can be adjusted easily in the event of any future update.
2.4. Estimation of sport related employment consumer spending and turnover
As in the case of GVA, the overall sport employment for the UK has been estimated to within +/-5% of
the official statistics. After several trials, the method of achieving this level of alignment included the
following steps:
Using Input Output Tables (IOTs) and sport GVA totals, we estimated wage bills for sport
employees per SIC code;
The Economic Importance of Olympic and Paralympic sport
14
using mean wages from the Annual Survey for Hours and Earning (ASHE), and wage bills we
estimated the number of employees (head count);
alternatively, by using full time wages we calculated full time equivalents (FTE); and
by using data from ONS, the number of employees found was adjusted upwards to include
those classified as self-employed.
This procedure provides an employment figure for each sport-related SIC code reviewed, which is then
distributed around the grid.
Using GVA figures and IOT ratios for each SIC code (for example turnover / GVA for specific economic
activities as identified in the National Accounts), we can import sport-related consumer spending and
turnover into the model. In each case we derive overall consumer spending and turnover figures for
relevant SIC codes, which are then allocated across sports. It is worth noting that consumer spending
in this case includes household spending only and excludes final spending from non-profit institutions,
which may have the effect of understating the total amount marginally.
2.5. Distribution of sport estimates across sports
The GVA for all sport is allocated to the relevant Olympic and Paralympic sports based on:
the participation distribution between sports (Active People Survey and Taking Part Survey);
the economic activities that are relevant in each sport, creating a sport grid;
assumptions about sports and activities that have been excluded, and
the commercial presence of some sports as a basis for cross-referencing and providing a 'sense
check'.
(i) The participation rates have been analysed in section 1.4 above, and include both adults and
children.
(ii) The allocation of the overall sport-related GVA to specific sports is a major innovation of this
project. Our aim was to link each Olympic and Paralympic sport with the relevant economic activity
found in each of the 182 SIC codes that we analysed. Some codes, such as 96.09 are associated with
the vast majority of sports. Others, such as 01.19, are limited to specific sports (in this case
equestrian). Hence, from the outset we needed to map SIC codes that are associated with Olympic
and Paralympic sports. This process was conducted by using annual reports, trade profiles and
descriptions, financial statements, and associated four-digit SIC codes filed with Companies House (see
Appendix).
The first major observation from this mapping exercise is that Olympic and Paralympic sports span a
surprisingly large number of industrial sectors and SIC codes. The breadth of sport's economic reach
implies a strong link between sport and the rest of the economy, which in turn means that we should
expect to see relatively high multiplier values across the entire sport production process.
The association between individual sports and SIC codes was decided on the basis of three methods:
firstly, by analysing the descriptive narrative and examples used in each category;
secondly, by assuming that some SIC codes, such as all in the statistical definition; medicines
(narrow definition); and newspapers (broad definition), are associated with all sports; and
The Economic Importance of Olympic and Paralympic sport
15
thirdly, by researching the Companies House data set for Principal SIC codes under the name
and trade description of each sport.
The associations established between sports and SIC codes led to the development of a grid, an extract
of which is illustrated in Figure 1.
It should be noted that all of the Olympic and Paralympic sports that are listed in Table 2 (participation
rates) are included in the master version of the sport by economic activity grid. Figure 1 is merely for
illustrative purposes.
For example, in the case of SIC 13.94 (Manufacture of cordage, rope, twine and netting) the sport-
related GVA is estimated to be £3.7m. The only sports in the grid associated with this activity are
climbing and sailing, although other sports may use ropes as an indirect input rather than as a
necessary requirement. Consequently, the total of sport-related GVA in SIC code 13.94 is distributed
solely to climbing and sailing.
(iii) The detailed restrictions for the allocation of GVA to sports (which is also applicable to the
estimates for employment and consumption) are outlined below:
exclusion of football, golf, rugby, cricket, motorsport and tennis;
exclusion of the majority of sport-related betting as most of it is in horse racing and football
with no relationship to Olympic and Paralympic sport; and
triathlon was based on specific APS participation data, but its grid pattern was defined by
combining data from running, swimming and cycling.
Health and fitness activity (which has a participation rate of 11.2% in APS) is allocated to the Olympic
and Paralympic model at a rate that reflects the overlap of health and fitness with participants in
Olympic and Paralympic sports. Using our own analysis of APS we found that of the 11.2% of
participants who took part in health and fitness, 58% did not participate in Olympic or Paralympic
sports. In other words, 42% of health and fitness participants also took part in one or more Olympic
and Paralympic sports and this percentage of health and fitness economic activity was allocated to
them. Finally, the equestrian sport categories were adjusted upwards on the basis of participation to
reflect the combined equestrian participation rates suggested by APS, as APS includes overall
equestrian participation rates that are greater than the sum of the participation rates for the three
Olympic disciplines.
The Economic Importance of Olympic and Paralympic sport
16
Figure 1: Olympic-Paralympic Sport vs economic activity (SIC) grid- an extract
The Economic Importance of Olympic and Paralympic sport
17
(iv) Commercial information available for individual sports was used as a source of sense checking and
to fine-tune the model. This approach was particularly important for approximating the economic size
of sports that were excluded from the study. The current research was informed by three recent
sport-specific economic valuations of golf
9
10
and football
11
. The golf study for the UK revealed a golf-
specific GVA of over £2 billion. The football study was mainly centred on the economics of the Premier
League and in this sense was not representative of the entire football sector. A search of company
accounts, for the benefit of this project, showed that football generated GVA in excess of £5bn. As
football and golf are not part of this research, it follows that Olympic and Paralympic sport will be at
least £7 billion less than the overall GVA for sport found in the DCMS Satellite Account for Sport in
2014 (£30.3 billion). In the case of gymnastics the participation rate amongst adults was at odds with
the commercial profile of the sport found on the FAME database. This finding and further
investigation led us to the conclusion that the sector was driven by children's participation, which was
not captured in the adult survey. As a result we incorporated children participation into the research.
2.6. Calculation of indirect effects in GVA, employment and turnover.
The main part of the Satellite Account is concerned with the direct demand for Olympic and
Paralympic sport in terms of GVA, employment, consumer spending and turnover. This represents the
immediate net (or direct) change in economic activity in the sectors of the economy that service
Olympic and Paralympic sport such as the manufacture of sports goods. However, the overall
economic impact of sport includes an indirect component reflecting the way in which initial
expenditure subsequently filters through an economy. Industries that create direct impacts depend on
the supply of goods and services from other industries, which in turn have to change their outputs to
meet demand. These inter-industry, or supply chain, transactions of intermediate goods and services
represent the indirect impact, and originate mainly from the non-sport commercial sector, for
example food and drink supplies for clubs or energy requirements of sport stadiums.
As a further development to the initial direct economic impact, the indirect effects on GVA,
employment and turnover are also calculated. All multipliers used (associated with the Leontief Type I
matrix, as reported by the Office for National Statistics) represent the linkages between different
sectors of the economy, and are based on the latest analytical Product-by-Product Tables provided by
ONS. When multiplying a change in final demand (direct impact) by a Type I output multiplier, the net
effect is to create an estimate of the direct and indirect impacts upon output throughout the economy.
2.7. Concluding remarks.
Overall, the current methods provide an estimation of the economic impact of Olympic and Paralympic
sport in terms of GVA, employment, consumer spending and turnover using an approach consistent
9
SIRC: A Satellite Account for Golf in the UK, 2016, a research supported by the R&A
(http://www.sportsthinktank.com/uploads/economic-impact-of-golf.pdf)
10
SIRC (2017) A Satellite Account for Golf in the Republic of Ireland, R&A and the Confederation of Golf in
Ireland, Dublin. https://www.golfnet.ie/News%20Listing%20Assets/CGI%20Report%20Economic%20Impact.pdf
11
The Premier League, Economic Impact Analysis; Ernst & Young LLP (2015);
http://www.ey.com/Publication/vwLUAssets/EY_-_The_economic_impact_of_the_Premier_League/$FILE/EY-
The-economic-impact-of-the-Premier-League.pdf
The Economic Importance of Olympic and Paralympic sport
18
with the compilation of the UK's National Accounts and DCMS’s SSA. By examining each SIC code
separately (and including estimates of the major sports that have been excluded, such as golf) it is
possible to distribute GVA using participation in each sport. This is a pragmatic approach and acts as a
reasonable starting point, given that sports such as golf and football which have relatively high average
levels of consumer spending are excluded. Additionally, the approach is transparent and can be
updated in the light of new data yet still retain its structural integrity. As a caveat, although we have
employed the Satellite Account methodology used for the sport industry as a whole, which is
recognised as an Official Statistic, the contents of this report are not UK Official Statistics.
3. ESTIMATION OF SPORT SPECIFIC GVA
Table 5 below presents the results of the GVA generated by all current and known future Olympic and
Paralympic sports. The results are presented on the basis of the 'statistical', 'narrow' and 'broad'
definitions of sport, consistent with the overarching Vilnius Definition. A more detailed table, including
GVA (broad definition) estimates for each sport is attached in Table A.2 in the Appendix. In 2014,
Olympic and Paralympic sport generated £18.9bn of GVA, which equates to 55% of the total sport-
related GVA for that year. This is divided into summer Olympic sport (£16.1bn), winter Olympic sport
(£0.7bn) and all Paralympic sport (£2.1bn). The sector is driven by a minority of sports, notably
athletics, swimming and road cycling with GVAs of £2.1bn, £3.2bn and £2.3bn respectively. These
three sectors have a very strong profile both in terms of participation and commercial presence in the
Companies House database.
Table 5, GVA £m, 2014
GVA £m
Statistical
Definition
Narrow
Definition
Broad
Definition
UK Sport
funding
Olympic sport
£2,026
12.6%
£9,265
57.5%
£16,104
100%
£258.5
Winter sport
£115
16.9%
£374
55.1%
£678
100%
£22.9
Paralympic sport
£217
10.4%
£1,110
53.2%
£2,085
100%
£73.6
Total
£2,358
12.5%
£10,749
57.0%
£18,867
100%
£355.0
Total as % of all
sport
55%
The majority of GVA is generated in sports associated with the summer Olympics, since these
represent the majority of sport participants. A further trend is that more GVA is generated when there
is significant investment in sport equipment. For example in swimming, where the investment in sport
equipment is relatively low, the commercial profile of the sport is smaller than that suggested by its
participation rate. By contrast, both cycling and shooting have strong commercial profiles on the
grounds of the relatively extensive spending required on equipment and consumables.
As shown in Table 5, the statistical definition, or the direct cost of taking part, is highest for winter
sport (16.9%) than the other two categories. The narrow definition, which subsumes the statistical
definition, is 57% of the broad definition estimate for total Olympic and Paralympic GVA. The final
column in Table 5 presents the UK Sport funding allocated to each category of sports for the Tokyo and
PyeongChang cycles. These funding allocations are targeted according to criteria concerned with
achieving greater medal success, and do not necessarily reflect the economic scale of sports as
The Economic Importance of Olympic and Paralympic sport
19
determined mainly by participation rates. If we annualise UK Sport's investment in Olympic and
Paralympic sport (c. £89m per annum), it is clear that support for elite sport development systems is a
tiny fraction of the overall sport industry. In its entirety, the industry associated with Olympic and
Paralympic sport is measurable and significant in the context of the UK economy as a whole, as shown
in Figure 2.
Figure 2: Olympic and Paralympic sport relative to the UK economy
With a total GVA of £18,677 million, Olympic and Paralympic sport is an industry which is larger than
three entire sectors of the UK economy, namely: activities of households as employers; agriculture,
forestry and fishing; and water supply, sewage, waste management and remediation services.
4. SPORT EMPLOYMENT, CONSUMER SPENDING AND TURNOVER
In 2014, the economic activity related to Olympic and Paralympic sport was responsible for 623,000
jobs, representing 58% of sport-related employment measured by employees (or head count).
Olympic and Paralympic sport also generated £36.6bn and £19.8bn in turnover (as explained in
paragraph 1.2 of the Introduction) and consumer spending correspondingly. In all cases turnover is
greater than GVA as it includes all other inputs required for production such as raw materials in
addition to wages and profits which are the sole focus of GVA. The consumer spending figure is
equivalent to £306 per head of the entire population (c. 64.6m) over the year. Comparisons with sport
as a whole from the DCMS 2014 Sport Satellite Account are possible for GVA and employment only as
consumer spending and turnover are not presented in that report.
As was the case with GVA, employment is driven by athletics, swimming and road cycling, with 69,000,
109,000 and 75,000 jobs (head count) respectively.
205,249
177,510
165,056
121,904
119,702
118,732
101,429
98,791
96,756
81,325
76,510
74,014
46,957
34,476
24,811
23,806
22,836
18,867
16,848
10,998
6,566
0 50,000 100,000 150,000 200,000 250,000
Real estate activities
Wholesale and retail trade; repair of motor vehicles and motorcycles
Manufacturing
Financial and insurance activities
Professional, scientific and technical activities
Human health and social work activities
Information and communication
Education
Construction
Public administration and defence; compulsory social security
Administrative and support service activities
Transportation and storage
Accommodation and food service activities
Other service activities
Electricity, gas, steam and air conditioning supply
Mining and Quarrying
Arts, entertainment and recreation
Olympic and Paralympic sport
Water supply, sewerage, waste management and remediation activities
Agriculture, Forestry and Fishing
Activities of households as employers
GVA £ million
The Economic Importance of Olympic and Paralympic sport
20
Table 6, Employment (head count), Consumer Spending and Turnover (£m), 2014
Employment
(head count)
Statistical Definition
Narrow Definition
Broad Definition
Olympic sport
68,600
12.9%
326,000
61.2%
532,500
100%
Winter sport
3,900
18.8%
12,700
61.2%
20,700
100%
Paralympic sport
7,300
10.5%
38,800
55.5%
70,000
100%
Total
79,800
12.8%
377,500
60.6%
623,200
100%
% of all sport
58%
Consumer
spending £m
Statistical Definition
Narrow Definition
Broad Definition
Olympic sport
£4,357
26.3%
£11,054
66.8%
£16,540
100%
Winter sport
£247
22.8%
£783
72.2%
£1,085
100%
Paralympic sport
£468
21.9%
£1,379
64.4%
£2,141
100%
Total
£5,072
25.7%
£13,216
66.9%
£19,766
100%
Turnover £m
Statistical Definition
Narrow Definition
Broad Definition
Olympic sport
£5,686
18.2%
£18,698
59.8%
£31,277
100%
Winter sport
£323
24.0%
£777
57.7%
£1,347
100%
Paralympic sport
£611
15.2%
£2,229
55.5%
£4,015
100%
Total
£6,620
18.1%
£21,704
59.2%
£36,639
100%
In general, both employment and turnover follow a similar pattern to the distribution of GVA. They
are derived specifically for each sport on the basis of the GVA distribution in the grid and the ratio
between turnover and GVA, for each economic category, suggested by the National Accounts (Input
Output Tables). Table 6 presents the estimates for employment, consumer spending and turnover
across summer Olympic, winter Olympic and Paralympic sports. All three components of the Vilnius
Definition, 'statistical', 'narrow' and 'broad' are used. For employment, the statistical and narrow
definitions account for 12.8% and 60.6% of the broad definition respectively.
As Table 6 shows, the statistical definition is considerably higher for consumer spending (25.7%)
compared with employment (12.8%) and turnover (18.1%). There are two possible explanations for
this finding. First, consumer spending reflects the economic importance of charges for taking part in
sport incurred by individuals, for example club membership. Second, there are some economic
activities such as wholesale or research and development which are not directly related to households
and which dilute the relative weight of participation costs in employment and turnover.
Finally, by using average full-time wages in the calculation of employment (instead of overall average
wages) we can derive employment as measured by Full Time Equivalent jobs (FTE) as shown in Table 7.
For Olympic and Paralympic sports it is estimated that the headcount of 623,200 jobs is equivalent to
479,600 FTEs. As is the case with the other indicators, the vast majority of employment is
concentrated in the summer Olympic sports (409,600 FTEs, 85%). The distribution of FTE employment
is 10.1% in the statistical definition and 58% in the narrow definition.
The Economic Importance of Olympic and Paralympic sport
21
Table 7, Employment, full time equivalent (FTE), 2014
Employment FTE
Statistical Definition
Narrow Definition
Broad Definition
Olympic sport
41,500
10.1%
240,100
58.6%
409,600
100%
Winter sport
2,400
15.2%
9,000
58.4%
15,500
100%
Paralympic sport
4,400
8.2%
28,900
53.0%
54,500
100%
Total
48,300
10.1%
278,000
58.0%
479,600
100%
5. CASE STUDIES
In this section two sports are examined in greater detail, namely road cycling and gymnastics. The
former is one of the leading sports for generating GVA and the latter is a sport that led to revisions in
the methods used due to a discrepancy between a low adult participation rate and a high commercial
profile. A third case study introduces the five new Olympic sports for Tokyo 2020, namely: baseball /
softball, climbing, karate, skateboarding and surfing.
5.1 Road cycling
At 3.35% the adult participation rate for road cycling (last four weeks) is one of the highest of all sports
and equates to 1.76 million participants. The main estimates around road cycling are detailed in Table
8. GVA is particularly high for a specific sport at £2,310m, and is caused by expenditure on bicycles,
accessories, clothing, footwear, and the costs of participation in clubs, events and the National
Governing Body. This economic activity is the catalyst for some 74,900 jobs (head count) directly and
indirectly dependent upon road cycling. As in most sports and the service sector more widely, a
significant proportion of those jobs are in part time employment. In the case of road cycling, the head
count of 74,900 converts into 58,300 FTE. Finally road cycling generates £2,167m in consumer
spending which by the time it filters its way through the economy results in turnover of £4,384m.
Table 8 economic impact of Road Cycling, 2014
Measure
Value
GVA
£2,310m
Employment (head count)
74,900
Employment (FTE)
58,300
Consumer spending
£2,167m
Turnover
£4,384m
A detailed analysis of the cycling sector found noteworthy companies that are directly or indirectly
associated with the sport. Road cycling has an important presence in well-known companies such as
Halfords, Outdoor and Cycle Concepts, F.W. Evans Cycles, Chain Reaction Cycles, and Wiggle Limited
(to name but a few). The British Cycling Federation on its own (through 260 employees) generated
GVA of £11.8m, 62% of which is associated with road cycling (according to the participation rates). The
economic presence of road cycling has also been found in some high street chains such as Argos and
Sports Direct. To appreciate the strength of some operators involved, Table 9 presents a selection of
GVA, employment and income statistics as they appear in the Annual Accounts.
The Economic Importance of Olympic and Paralympic sport
22
Table 9 Road cycling companies and organisations, 2014
Company
GVA, £m
Employment
Income, £m
Outdoor and Cycle concepts
70.9
1,317
115.7
F.W. Evans Cycles
70.5
1,179
127.7
Chain Reaction Cycles
65.8
540
153.4
Wiggle
55.2
456
179.2
Cycle Surgery
12.3
214
24.1
The British Cycling Federation (all cycling)
11.8
261
26.1
By searching through the top 500,000 companies registered with Companies House, the GVA
associated with cycling was found to be well in excess of £1bn. This finding provides confidence that
the final estimate of £2,310m is reasonable as there are many smaller companies engaged with cycling
throughout the economy. Table 10 illustrates the distribution of GVA for road cycling according to
specific SIC codes. Sport activities, retail sales and manufacturing dominate the generated GVA in the
sport.
The popularity of cycling has increased as demonstrated by 327,100 more adults cycling in Active
People Survey 8 compared with Active People Survey 1. It is not possible to attribute specific factors
that have caused such growth, but there are various developments that have occurred which
collectively might help to explain such growth. These include but are not limited to:
the recent success of British riders in the Olympic Games and Tour de France;
hosting the Tour de France in 2007 and 2014;
a shift away from traditional team sports to solo sports;
tax incentives such as the Cycle to Work scheme;
improved cycling infrastructure, notably in London, and
disincentives for car use such as the congestion charge.
In line with the increase in demand for cycling there has been an increase in cycling investment for the
first time in the last 15 years. After Raleigh shut its Nottingham factory in 2003 and moved its
production line to Taiwan, manufacturing was restricted to three mass-market manufacturers
providing notable products such as folding bicycles and London's rental bicycles. However, the
popularity of cycling has attracted the world's largest manufacturer by volume (Hero Cycles) to set up
a design centre in Manchester, in the home of British Cycling. Hero Cycles manufactures 5% of the
world's bicycles (by volume) and it hopes that the bicycles it designs will be associated with Olympic
success, which in turn will strengthen its brand. On the basis of this potential, Manchester was
preferred ahead of currently more cycle-friendly cities such as Amsterdam and Berlin.
The Economic Importance of Olympic and Paralympic sport
23
Table 10 SIC codes and GVA, 2014
SIC
General description
Road
Cycling
GVA, £m
%
47.59
Retail sale household articles in specialised stores
212.6
9.2%
93
Sport activities
209.8
9.1%
69.1
Legal activities
175.9
7.6%
59.13
Motion picture, video and television programme distribution activities
128.2
5.5%
47.64
Retail sale of sporting equipment in specialised stores
124
5.4%
55.1
Hotels and similar accommodation
115.6
5.0%
46
Wholesale trade services, except of motor vehicles and motorcycles
85.0
3.7%
85.31
General secondary education
81.4
3.5%
84
Public administration and defence; compulsory social security
78.9
3.4%
30.92
Manufacture of bicycles and invalid carriages
67.8
2.9%
60.2
Television programming and broadcasting activities
65.4
2.8%
92
Gambling and betting activities
58.7
2.5%
45
Wholesale and retail trade and repair services of motor vehicles
56.5
2.4%
85.51
Sport and recreation education
48.9
2.1%
68.2
Renting and operating of own or leased real estate
45.9
2.0%
96.09
Other personal service activities n.e.c.
44.7
1.9%
32
Other manufactured goods
39.2
1.7%
42.99
Other construction installation
39.1
1.7%
47.71
Retail sale of clothing in specialised stores
37.2
1.6%
94
Services furnished by membership organisations
34.3
1.5%
47.78
Other retail sale of new goods in specialised stores
33.6
1.5%
74
Other professional, scientific and technical services
32.0
1.4%
86
Hospital activities
28.8
1.2%
59.12
Motion picture, video and television programme post-production
27.9
1.2%
55.2
Holiday and other short-stay accommodation
27.7
1.2%
58
Publishing services
26.2
1.1%
18
Printing and recording services
25.5
1.1%
21.2
Manufacture of pharmaceutical preparations
24.9
1.1%
79
Travel agency, tour operator and other reservation services
23.0
1.0%
Other
311.3
13.5%
Total
2,310
100%
Looking ahead, the cycling industry faces two interesting technological challenges. First, the
improvement in the quality of bicycles is likely to lengthen the time between replacing cycles, which
The Economic Importance of Olympic and Paralympic sport
24
may result in fewer sales. On the other hand innovations such as battery powered e-bikes are gaining
in popularity, introducing a new group of participants to the cycling market.
5.2 Gymnastics
All sports included in this research take into account the sport participation rates of both adults and
children where data permit. Nowhere is the effect of children’s participation more economically
significant than in gymnastics. When the first wave of results was cross referenced with the sport’s
commercial presence the adult participation rate in gymnastics (0.26%) was at odds with its very high
commercial profile. The economic driver of gymnastics is children’s participation which has a very high
participation rate of 10.3%, equivalent to almost 800,000 participants under the age of 16.
The main estimates around Gymnastics are shown in Table 11.
Table 11 Economic impact of Gymnastics, 2014
Measure
Value
GVA
£520m
Employment (head count)
15,700
Employment (FTE)
11,600
Consumer spending
£535m
Turnover
£1,038m
As in the case of road cycling, turnover at £1,038m was almost double the size of GVA and consumer
spending. Employment in 2014 was a head count of 15,700 which equates to 11,600 FTEs and reflects
the large number of people working in the sport on part time basis, such as coaches.
A detailed analysis of the sector found many organisations that are directly or indirectly associated
with the sport of gymnastics. Most of them are clubs, academies and associations which receive
income from households (e.g. membership fees) or other organisations such as local government (e.g.
grants). Notable examples include the national governing body for the sport, the British Amateur
Gymnastic Association, and several schools of gymnastics and dance such as Heathrow School, City of
Newcastle Gymnastics Academy, and Chelmsford Gymnastics Club.
Table 12 Some Gymnastics and organisations, 2014
Organisation
GVA, £m
Employment
Income, £m
British Amateur Gymnastics Association
7.2
154
15.0
South Essex Gymnastics Club
0.6
64
1.1
Basingstoke Gymnastic Club
0.5
90
0.9
Table 12 shows some of these organisations’ economic scale in terms of GVA, employment and
income. The sector is based on a large number of small clubs (1,400 in the UK, with 300,000 members)
which receive regular funding from households and institutions. According to the British Amateur
Gymnastics Association, in 2014 there was a 12% growth in membership. The size of the clubs and the
The Economic Importance of Olympic and Paralympic sport
25
high labour requirements result in gymnastics being noteworthy for the volume of employment
associated with the sport.
The GVA in gymnastics is associated with a wide range of business activities as indicated in the
breakdown shown in Table 13 below:
Table 13 SIC codes and GVA, 2014
SIC
General description
Gymnastics
GVA, £m
%
93
Sport activities
115.8
22.3%
47.64
Retail sale of sporting equipment in specialised stores
68.5
13.2%
84
Public administration
43.6
8.4%
60.2
Television programming and broadcasting activities
36.1
6.9%
85
Sport education
27.8
5.3%
96
Personal service activities
25.7
4.9%
47.71
Retail sale of clothing in specialised stores
20.5
3.9%
94
Activities of membership organisations
18.9
3.6%
46
Wholesale of clothing and footwear
22.8
4.4%
86
Hospital activities
15.9
3.1%
18.12
Other printing
14
2.7%
21.2
Manufacture of pharmaceutical preparations
13.7
2.6%
90.01
Performing arts
9.4
1.8%
63.91
News agency activities
8.6
1.7%
32.3
Manufacture of sport goods
7.8
1.5%
32.5
Manufacture of medical and dental instruments and supplies
7.3
1.4%
49
Land transportation
7.2
1.4%
58.13
Publishing of newspapers
7.1
1.4%
82.99
Other business support service activities
5.5
1.1%
Other
43.8
8.4%
Total:
520
100%
In 2014, gymnastics experienced a record growth in membership which will grow the sport further in
terms of economic impact and participation. Among the 300,000 strong membership, 70% are under
12 years old. Given the importance of young people’s participation in gymnastics, it is appropriate that
education remains a high policy priority. According to British Gymnastics (BG), over 467 courses were
held in 2014/15, with over 4219 coaches accredited
12
. The key performance indicators, as identified
by BG, include the membership rise of 12% and the funding from government grants of 36% of income.
The recent success of Team GB in gymnastics, improving from one medal in Beijing 2008 to seven
medals in Rio 2016, will be worth tracking in further detail to establish if Olympic success is associated
with increased participation and economic scale.
12
https://www.british-gymnastics.org/documents/footer-menu-items/agm-2015/6943-directors-report-
financial-statements-year-ended-31-3-15/file
The Economic Importance of Olympic and Paralympic sport
26
5.3 New Olympic sports for Tokyo 2020
The five new sports that have been included on the Tokyo 2020 Olympic programme are all relatively
minor sports and it is worth an initial examination of their economic characteristics as a group. They
include baseball/softball, karate, skateboarding, climbing and surfing. Table 14 is a snapshot of the
participation rates and numbers taken from Table 3.
Table 14: New Olympic sports- participation rates, 2014
Sport
Participation Rate (%)
Participants
Baseball and softball, Adults
0.05%
26,222
Baseball and softball, Children
0.90%
73,143
Climbing, Adults
0.72%
377,593
Karate, Adults
0.21%
110,131
Skateboarding, Adults
0.10%
52,444
Surfing, Adults
0.20%
104,887
In the case of baseball / softball, the scale of children’s participation boosts overall participation rates
and numbers. Amongst children the participation rate is 0.9% (73,000 participants) compared with
0.05% (26,000 participants) in the case of adults. For the remaining sports climbing has a relatively
high participation rate among adults at 0.72% (378,000 participants).
Table 15 The economic characteristics of the five new sports for Tokyo 2020
Measure
Baseball /
softball
Karate
Skateboarding
Climbing
Surfing
GVA
£56m
£85m
£20m
£250m
£53m
Employment (head
count)
1,800
2,600
600
8,600
1,900
Employment (FTE)
1,400
2,000
400
6,500
1,400
Consumer spending
£59m
£87m
£24m
£355
£57
Turnover
£106m
£165m
£41m
£486m
£106m
Table 15 presents the most important indicators in terms of GVA, employment, consumer spending
and turnover for the five new Olympic sports. Based on its relatively high participation rate among
adults and its specialist equipment needs, climbing is responsible for the highest GVA (£250m) and
employment (8,600 head count, 6,500 FTE) of the five new Olympic sports. Climbing was followed by
karate which supports 2,000 FTE jobs. In 2014, households spent £87m on karate, of which the
majority is channelled through almost 800 clubs which form the backbone of the sport. These sports
represent an interesting portfolio to monitor in the lead in to and aftermath of Tokyo 2020 to establish
whether or not Olympic status has a material impact on their economic scale.
The Economic Importance of Olympic and Paralympic sport
27
6. INDIRECT EFFECTS IN GVA, EMPLOYMENT AND TURNOVER.
By using the indirect multipliers derived for GVA, employment and turnover, the indirect effect of
sport can be estimated. Industries that create direct impacts depend on the supply of goods and
services by other industries, which in turn have to change their outputs to meet demand. These inter-
industry transactions of intermediate goods and services represent the indirect impact, and originate
mainly from the non-sport commercial sector, for example food and drink supplies. This extra indirect
demand can be translated into all GVA, employment and turnover indicators as Table 16 below
illustrates. The overall estimated direct and indirect effect amounts to £29,979m in GVA, 1,018,000 in
employment (headcount), and £73,408m in turnover. The percentage increases of the indirect effects
over the direct effects are estimated at 58%, 63% and 200% in GVA, employment and turnover
respectively. This is the 'ripple effect' of Olympic and Paralympic sport which can be said to be the
catalyst for an even more extensive scale of economic activity.
The Economic Importance of Olympic and Paralympic sport
28
Table 16, Total indirect effects in GVA, Employment and Turnover 2014
Olympic sport
Direct +
Indirect
GVA, £m
Direct +Indirect
Employment
(headcount, 000s)
Direct + indirect
Turnover £m
Archery
169
6.0
415
Athletics
3,384
113.5
8,190
Badminton
1,269
42.4
3,092
Basketball
970
33.2
2,382
Boxing
635
22.1
1,562
Canoeing
444
14.1
1,079
Cycling BMX
175
5.8
435
Cycling Mountain Bike
1,892
62.8
4,693
Cycling Road
3,622
120.2
8,983
Cycling Track
185
6.1
458
Swimming/diving
5,085
173.8
12,528
Equestrian Dressage
740
32.1
1,793
Equestrian Jumping
623
27.1
1,510
Fencing
35
1.1
87
Gymnastic
855
27.6
2,038
Handball
8
0.3
20
Hockey
382
12.8
939
Judo
77
2.4
181
Rowing
315
10.1
755
Sailing
476
15.7
1,166
Shooting
964
31.2
2,389
Table Tennis
1,109
37.6
2,714
Taekwondo
96
3.2
232
Trampoline
156
5.4
377
Triathlon
142
4.8
353
Volleyball
202
6.8
493
Water Polo
20
0.7
49
Weightlifting
713
22.6
1,678
Wrestling Freestyle
56
1.7
131
Wrestling Greco-Roman
56
1.7
131
Baseball/Softball
88
3.0
216
Karate
136
4.5
326
Skateboarding
34
1.1
81
Climbing
394
13.8
966
Surfing
87
3.1
210
The Economic Importance of Olympic and Paralympic sport
29
Winter Games
Alpine Skiing
199
6.5
488
Free Style Skiing
45
1.5
111
Cross Country Skiing
9
0.3
22
Curling
11
0.3
24
Skating
719
23.2
1,723
Ice Hockey
26
0.9
64
Nordic Combined
45
1.5
111
Snowboard
54
1.8
133
Paralympics
Alpine Skiing
11
0.4
28
Archery
3
0.1
8
Athletics
203
7.0
494
Badminton
100
3.4
245
Boccia
2
0.1
4
Canoe
52
1.7
126
Cycling
972
32.6
2,413
Equestrian
125
5.5
305
Football
621
21.6
1,538
Judo
22
0.7
52
Power lifting
6
0.2
15
Rowing
15
0.5
36
Sailing
124
4.1
304
Shooting
180
5.8
446
Sitting Volleyball
6
0.2
16
Swimming
600
20.5
1,478
Table Tennis
74
2.5
181
Taekwondo
20
0.7
49
Triathlon
8
0.3
21
Wheelchair Basketball
65
2.3
161
Wheelchair Curling
2
0.1
4
Wheelchair Fencing
7
0.2
17
Wheelchair Tennis
56
1.9
137
Total Direct and Indirect
effect
29,979
1,018
73,408
Direct effect
18,867
623
36,639
Indirect effect
11,112
395
36,769
The Economic Importance of Olympic and Paralympic sport
30
7. CONCLUSION
The publication of this Satellite Account for Olympic and Paralympic sport is consistent with the
Government's sport strategy Sporting Future, which cites economic development as one of five high
level outcomes required from sport. What is meant by economic development in this context is 'a
more productive, sustainable and responsible sport sector'. The key performance indicator to be used
to measure the economic importance of sport will be the Department for Culture, Media and Sport's
Sport Satellite Account. Of note in Sporting Future (p.80) is Key Performance Indicator 16
"Employment in the sport sector” which will be derived from the Sport Satellite Account.
This report presents the findings from the application of the UK Sport Satellite Account methodology
to estimate the economic value of the subset of Olympic and Paralympic sports for the year 2014 using
four principal measures:
Gross Value Added (GVA);
Employment;
Consumer spending, and.
Turnover.
This research identifies for the first time the allocation of sport-related GVA across Olympic and
Paralympic sports. The overall value of £18.9bn equates to 55% of the total GVA generated by sport in
the UK. When the indirect effect is added to the direct effect, total GVA is estimated at £30.0bn.
Olympic and Paralympic sport is an industry which is larger than three entire sectors of the UK
economy, namely: activities of households as employers; agriculture, forestry and fishing; and water
supply, sewage, waste management and remediation services. In terms of employment, Olympic and
Paralympic sport is responsible for 623,000 jobs (head count), which is equivalent to 2.1% of
employment in the economy as a whole and 56% of employment in the sport economy.
Table 17: The sporting context
Measure
Olympic and
Paralympic
sport (2014)
Sport (2014)
% of the sport
economy
% of the
UK economy
GVA
£18.87 billion
£34.30 billion
55.0%
1.2%
Employment
623,000
1,119,000
55.7%
2.1%
Consumer
spending
£19.77billion
n/a
n/a
1.7% (households)
Turnover
£36.64 billion
n/a
n/a
1.2%
In Table 17, when we examine Olympic and Paralympic sport in the context of the overall UK economy,
it is notable that the percentage of employment (2.1%) is higher than the percentage of GVA (1.2%). A
finding of this type is an indication of an industry that is efficient in generating employment. In
general, it has been shown
13
that sport is responsible for a relatively high number of jobs compared
13
SpEA, SIRC, Statistical Service of Republic of Cyprus, Meerwaarde Sport en Economie, FESI, Ministry of Sport
and Tourism of the Republic of Poland (2012). Study on the Contribution of Sport to Economic Growth and
Employment in the EU. Research Report. European Commission, Directorate-General Education and Culture.
(http://ec.europa.eu/sport/library/studies/study-contribution-spors-economic-growth-final-rpt.pdf)
The Economic Importance of Olympic and Paralympic sport
31
with its GVA; however this is the first time that the point has been demonstrated within the context of
Olympic and Paralympic sport.
Although consumer spending and turnover cannot be identified as percentages of the sport industry
because they are not reported in the DCMS's overall Sport Satellite Account, our estimate for Olympic
and Paralympic sport is that they are equivalent to 1.7% and 1.2% of UK consumer spending and
turnover respectively. The direct impacts reported above increase considerably when the indirect
impact of supply chains is included. When the appropriate multipliers are applied, GVA and
employment increase by 58% and 63% respectively, while turnover doubles. As before, these ratios
show that Olympic and Paralympic sport is job rich, and it would be reasonable to expect an increase
in employment in response to an increase in participation.
This research has been conducted so that it is consistent with the current UK Sport Satellite Account
enabling any adjustments or future updates to be implemented in line with the National Accounts. It
has used both participation data and commercial presence to allocate GVA and employment to
Olympic and Paralympic sport. The methods used are transparent and can be used in the future for
revising previous results in the light of new information. However, this research is not without its
limitations and we make two recommendations to improve future editions of the study. First, it would
be possible to construct an employment grid independent of the GVA grid, with employment shares
constructed from annual reports sourced from Companies House via the FAME database. Such an
approach is likely to highlight further the job rich nature of Olympic and Paralympic sport. In other
words, investing in Olympic and Paralympic sport generates more employment than is generally true
for the economy as a whole.
Second, any further information about SSAs associated with Olympic or even non-Olympic sport can be
included within the current methodological framework and in turn improve the accuracy of the results.
Currently among the most economically significant sports, only golf has an SSA. Producing SSAs for
football and motorsports would provide an even more realistic GVA value for Olympic and Paralympic
sport, once the total sport SSA for the year in question is known.
This report has shown that Olympic and Paralympic sport is fundamental in creating GVA and
employment within the sport industry, accounting for the majority of the output produced. Further,
this report is the first example of the UK sport industry being analysed separately by the three
component parts of the Vilnius Definition of sport. Generally the statistical definition for GVA,
employment and turnover ranged between 12% and 18%. However, in the case of consumer spending
the statistical definition was much higher at 25.7%, which reflects the economic importance of charges
for taking part in sport. Future research should investigate the economic significance of sport
volunteering, which is not included in the Vilnius Definition; as well as the growth in sport
employment. The five outcome areas of Sporting Future also require research into the social value of
elite sport and this is underway in complementary research.
The UK now has a transparent audit trail of evidence by which to value the economic importance of
Olympic and Paralympic sport, which is consistent with the DCMS's Sport Satellite Account. This
position represents a strong basis from which to monitor the development of Olympic and Paralympic
sport in future years.
The Economic Importance of Olympic and Paralympic sport
32
APPENDIX
Table A.1. -Mapping of the UK Olympic and Paralympic sport industry 30
Table A.2. Detailed GVA, Employment, Consumer spending and Turnover tables, 2014 35
The Economic Importance of Olympic and Paralympic sport
33
Table A.1. -Mapping of the UK Olympic and Paralympic sport industry
SIC
General description
Economic activities in the statistical definition
93.11
Operation of sports facilities
93.12
Activities of sport clubs
93.13
Fitness facilities
93.19
Other sports activities
Additional economic activities in the narrow definition
1.19
Growing of other non-perennial crops
1.43
Raising of horses and other equines
1.62
Support activities for animal production
10.91
Manufacture of prepared feeds for farm animals
13.92
Manufacture of soft furnishings
13.94
Manufacture of cordage, rope, twine and netting
14.11
Manufacture of leather clothes
14.12
Manufacture of workwear
14.13
Manufacture of other outerwear
14.14
Manufacture of underwear
14.19
Manufacture of other wearing apparel and accessories n.e.c.
15.12
Manufacture of luggage, handbags and the like, saddlery and harness
15.2
Manufacture of footwear
22.11
Manufacture of rubber tyres and tubes; retreading and rebuilding of rubber tyres
25.40
Manufacture of weapons and ammunition
26.52
Manufacture of watches and clocks
28.99
Manufacture of other special-purpose machinery n.e.c.
29.1
Manufacture of motor vehicles
29.2
Manufacture of bodies (coachwork) for motor vehicles; manufacture of trailers and semi-
trailers
30.12
Building of pleasure and sporting boats
30.30
Manufacture of air and spacecraft and related machinery
30.91
Manufacture of motorcycles
30.92
Manufacture of bicycles and invalid carriages
30.99
Manufacture of other transport equipment n.e.c.
32.3
Manufacture of sports goods
32.4
Manufacture of games and toys
32.99
Other manufacturing n.e.c.
33.11
Repair of fabricated metal products
33.12
Repair of machinery
The Economic Importance of Olympic and Paralympic sport
34
33.13
Repair of electronic and optical equipment
33.15
Repair and maintenance of ships and boats
33.16
Repair and maintenance of aircraft and spacecraft
33.17
Repair and maintenance of other transport equipment n.e.c.
33.19
Repair of other equipment
33.20
Installation of industrial machinery and equipment
41.00
Civil engineering
42.91
Construction of water projects
42.99
Other construction installation
43.29
Construction of other civil engineering projects n.e.c.
43.99
Other specialised construction activities n.e.c.
45.11
Sale of cars and light motor vehicles
45.19
Sale of other motor vehicles
45.20
Maintenance and repair of motor vehicles
45.40
Sale, maintenance and repair of motorcycles and related parts and accessories
46.11
Agents selling agricultural raw materials, livestock, textile raw materials and semi-finished
goods
46.16
Agents involved in the sale of textiles, clothing, fur, footwear and leather goods
46.18
Agents specialised in the sale of other particular products
46.41
Wholesale of textiles
46.42
Wholesale of clothing and footwear
46.46
Wholesale of pharmaceutical goods
46.69
Wholesale of other machinery and equipment
46.71
Wholesale of solid, liquid and gaseous fuels and related products
47.30
Retail sale of automotive fuel in specialised stores
47.42
Retail sale of telecommunications equipment in specialised stores
47.51
Retail sale of textiles in specialised stores
47.54
Retail sale of electrical household appliances in specialised stores
47.59
Retail sale of furniture, lighting equipment and other household articles in specialised
stores
47.64
Retail sale of sporting equipment in specialised stores
47.71
Retail sale of clothing in specialised stores
47.72
Retail sale of footwear and leather goods in specialised stores
47.78
Other retail sale of new goods in specialised stores
47.91
Retail sale via mail order houses or via Internet
47.99
Other retail sale not in stores, stalls or markets
75
Veterinary activities
77.21
Renting and leasing of recreational and sports goods
77.32
Renting and leasing of construction and civil engineering machinery and equipment
81.3
Landscape service activities
85.1
pre-primary education
The Economic Importance of Olympic and Paralympic sport
35
85.2
Primary education
85.31
General secondary education
85.32
Technical and vocational secondary education
85.41
Post-secondary non-tertiary education
85.42
Tertiary education
85.51
Sport and recreation education
85.52
Cultural education
85.59
Other education n.e.c.
85.6
Educational support services
932.1
Activities of amusement parks and theme parks
93.29
Other amusement and recreation activities n.e.c.
94.11
Activities of business and employers memberships organisations
94.12
Activities of professional membership organisations
94.99
Activities of other membership organisations
95.23
Repair of footwear and leather goods
95.29
Repair of other personal and household goods
96.04
Physical well-being activities
Additional economic activities in the broad definition
10.86
Manufacture of homogenised food preparations and dietetic food
11.07
Manufacture of soft drinks; production of mineral waters and other bottled waters
18.11
Printing of newspapers
18.12
Other printing
18.13
Pre-press and pre-media services
18.14
Binding and related services
19.20
Manufacture of refined petroleum products
21.20
Manufacture of pharmaceutical preparations
22.29
Manufacture of other plastic products
32.50
Manufacture of medical and dental instruments and supplies
46.38
Wholesale of other food, including fish, crustaceans and molluscs
46.43
Wholesale of electrical household appliances
46.49
Wholesale of other household goods
46.52
Wholesale of electronic and telecommunications equipment and parts
46.90
Non specialised wholesale trade
47.19
Other retail sale in non-specialised stores
47.29
Other retail sale of food in specialised stores
47.61
Retail sale of books in specialised stores
47.62
Retail sale of newspapers and stationery in specialised stores
47.73
Dispensing chemist in specialised stores
The Economic Importance of Olympic and Paralympic sport
36
47.74
Retail sale of medical and orthopaedic goods in specialised stores
47.794
Retail sale of second-hand goods in stores
49.10
Passenger rail transport, interurban
49.31
Urban and suburban passenger land transport
49.32
Taxi operation
49.39
Other passenger land transport
50.1
Sea and coastal passenger water transport.
50.3
Inland passenger water transport
51.1
Passenger air transport
52.21
Service activities incidental to land transportation
55.1
Hotels and similar accommodation
55.2
Holiday and other short-stay accommodation
55.3
Recreational vehicle parks, trailer parks and camping grounds
55.9
Other accommodation
56.1
Restaurants and mobile food service activities
56.2
Event catering and other food service activities
56.3
Beverage serving activities
58.11
Book publishing
58.13
Publishing of newspapers
58.14
Publishing of journals and periodicals
58.19
Other publishing activities
58.29
Other software publishing
59.11
Motion picture, video and television programme production activities
59.12
Motion picture, video and television programme post-production activities
59.13
Motion picture, video and television programme distribution activities
59.2
Sound recording and music publishing activities
60.1
Radio broadcasting
60.2
Television programming and broadcasting activities
62.01
Computer programming activities
62.02
Computer consultancy activities
62.09
Other information technology and computer service activities
63.91
News agency activities
63.99
Other information service activities n.e.c.
64.91
Financial leasing
65.11
Life insurance
65.12
Non-life insurance
68.10
Buying and selling own real estate
68.20
Renting and operating of own or leased real estate
68.32
Management of real estate on a fee or contract basis
69.1
Legal activities
69.2
Accounting, bookkeeping and auditing activities; tax consultancy
The Economic Importance of Olympic and Paralympic sport
37
70.10
Activities of head offices
70.21
Public relations and communications activities
70.22
Business and other management consultancy activities
71.11
Architectural activities
72.11
Research and experimental development on biotechnology
72.19
Other research and experimental development on natural sciences and engineering
73.11
Advertising agencies
73.12
Media representation services
74.10
Specialised design activities
74.2
Photographic activities
74.90
Other professional, scientific and technical activities n.e.c.
77.29
Renting and leasing of other personal and household goods
78.1
Activities of employment placement agencies
78.2
Temporary employment agency activities
79.11
Travel agency activities
79.12
Tour operator activities
79.9
Other reservation service and related activities
82.11
Combined office administrative service
82.30
Organisation of conventions and trade
82.99
Other business support service activities
84
Public administration and defence; compulsory social security
86
Hospital activities
87
Residential care activities
90.01
Performing arts
90.02
Support activities to performing arts
90.03
Artistic creation
90.04
Operation of arts facilities
91.01
Library and archive activities
91.02
Museums activities
91.03
Operation of historical sites and buildings and similar visitor attraction
92
Gambling and betting activities
96.09
Other personal service activities n.e.c.
The Economic Importance of Olympic and Paralympic sport
38
Table A.2. Detailed GVA, Employment, Consumer spending and Turnover tables, 2014.
Olympic sport
GVA £m
Employment
(thousands)
Consumer
spending
£m
Turnover
£m
Archery
107
3.7
130
206
Athletics
2112
68.8
1,728
4,081
Badminton
795
25.4
815
1,539
Basketball
619
20.6
864
1,182
Boxing
406
13.7
468
772
Canoeing
270
8.6
321
558
Cycling BMX
112
3.6
105
212
Cycling Mountain Bike
1207
39.1
1,132
2,290
Cycling Road
2310
74.9
2,167
4,384
Cycling Track
118
3.8
111
224
Swimming/diving
3239
108.8
3,236
6,219
Equestrian Dressage
448
18.8
693
964
Equestrian Jumping
377
15.9
583
811
Fencing
22
0.7
18
43
Gymnastics
520
15.7
535
1,038
Handball
5
0.2
5
10
Hockey
243
7.9
249
461
Judo
46
1.3
45
94
Rowing
185
6.0
219
398
Sailing
291
9.9
352
612
Shooting
620
19.3
490
1,178
Table Tennis
713
23.4
737
1,355
Taekwondo
60
1.9
55
116
Trampoline
95
3.2
87
189
Triathlon
91
3.0
83
173
Volleyball
129
4.2
141
243
Water Polo
13
0.4
13
24
Weightlifting
419
12.2
505
864
Wrestling Freestyle
33
0.9
35
67
Wrestling Greco-Roman
33
0.9
35
67
Baseball/Softball
56
1.8
59
106
Karate
85
2.6
87
165
Skateboarding
20
0.6
24
41
Climbing
250
8.6
355
486
Surfing
53
1.9
57
106
The Economic Importance of Olympic and Paralympic sport
39
Winter Games
Alpine Skiing
126
4.0
184
243
Free Style Skiing
29
0.9
42
55
Cross Country Skiing
6
0.2
8
11
Curling
6
0.2
8
13
Skating
432
13.0
734
871
Ice Hockey
17
0.5
17
32
Nordic Combined
29
0.9
42
55
Snowboard
34
1.1
50
66
Paralympics
Alpine Skiing
7
0.2
10
14
Archery
2
0.1
3
4
Athletics
128
4.3
102
247
Badminton
63
2.1
63
123
Boccia
1
0.1
1
2
Canoe
32
1.0
37
65
Cycling
622
20.5
576
1,181
Equestrian
76
3.2
116
164
Football
401
13.6
471
755
Judo
13
0.4
13
27
Power lifting
4
0.1
4
8
Rowing
9
0.3
10
19
Sailing
76
2.6
91
160
Shooting
116
3.6
92
220
Sitting Volleyball
4
0.1
4
8
Swimming
382
12.8
382
733
Table Tennis
48
1.6
49
90
Taekwondo
13
0.4
11
25
Triathlon
5
0.2
5
10
Wheelchair Basketball
42
1.4
57
80
Wheelchair Curling
1
0.0
1
2
Wheelchair Fencing
4
0.1
3
8
Wheelchair Tennis
36
1.2
37
68
Total
18,867
623
19,766
36,639
Total as % of sport
55.0%
58.0%