Optimism abounded when Birmingham won its bid to host the 2022 World Games. The games were supposed to attract scores of foreign visitors to the Birmingham-Jefferson County area and introduce them to Alabama, bringing substantial and long-lasting economic benefits.
It’s too early to know with absolute certainty what the long-term economic benefits of the games will be, but a newly released evaluation report by Quantum Consultancy indicates they fell well short of the promises made when Birmingham was announced as the host in 2015. In fact, debt from the World Games is still being paid off.
The cost of hosting the 2022 World Games was at least $65 million, covered largely by public-private partnerships. The total economic impact was $165 million, about 36% less than the original estimates of a more than $256 million impact, and the direct economic impact was only $11.7 million.
It is unclear how Quantum calculated the roughly $153 million in indirect economic impact. Quantum says that number includes all localized and visitor expenditures from when the event was awarded in 2015 through the conclusion of the games in 2022, but it’s hard to discern what that impact really includes.
For example, Legacy Arena went through a massive renovation prior to hosting World Games gymnastics and dance events, but the renovation was needed regardless. So is part or all of the $125 million in arena renovations included as an indirect economic benefit of the games? The answer to that question may show that indirect impacts could be inflated.
Whether the games really exposed many foreign visitors and Americans living outside of Alabama to the Birmingham-Jefferson County area is another question. Cumulative attendance for the games was 140,217 spectators, Quantum tells us. Of those, 83.6% were from Alabama, and nearly 80% of Alabamians attending were from the Birmingham-Jefferson County area. More than 13,000 foreign visitors from 50 countries came to Birmingham for the games, but many of those visitors were likely athletes. Actual foreign spectators made up just 2.7%, less than 4,000, of World Games attendees.
The total impact of spectators visiting the Birmingham-Jefferson County area was an estimated $4.08 million, with almost half of that going toward hotel stays. Only around 30% of the 377,000 tickets allocated for the games were purchased by spectators. The rest were tickets given to sponsors or other complimentary tickets. Just 37.1% of the tickets allocated were used to attend events.
To be fair, there were several factors that made the 2022 World Games, and their impact on the state, less fruitful than they might otherwise have been.
Originally scheduled to take place in 2021, the games were pushed back because of the COVID-19 pandemic and the subsequent postponement of the 2020 Olympic Games. The change in dates may have contributed to the drop in attendance.
Anecdotal evidence suggests attendance was hampered by other lingering impacts of the pandemic, Quantum reports, meaning that many fans, particularly international ones, did not feel comfortable traveling abroad to attend a busy sporting event. Inflation, a rise in shipping costs and other supply chain issues, as well as rising labor costs likely impacted the profitability of the World Games as well.
Finally, a summer heatwave may have also impacted attendance, Quantum explains. Heat-related illnesses were one of several reasons UAB Medicine treated hundreds of patients over the course of the games. Not to make light of a serious situation, but did anyone really not think heat would be a factor at predominantly outdoor events taking place in Alabama in the middle of July?
In terms of long-term positive benefits going beyond profits, the Quantum report points to a sustainability program aimed at having a positive impact on the local community and environment. But it appears that few, if any, of the efforts highlighted in the report continued after the games ended.
A large amount of taxpayer and private dollars were spent on Birmingham’s 2022 World Games. I certainly hope there are intrinsic benefits that cannot be easily measured. But when it comes to the cost versus the direct economic benefits, Alabamians did not get what they were promised in these games, nor what they paid for.
Justin Bogie serves as Fiscal and Budget Reporter for 1819 News. The views and opinions expressed here are those of the author and do not necessarily reflect the policy or position of 1819 News. To comment, please send an email with your name and contact information to: Commentary@1819News.com.
