The economic impact of major sports events: a case study of Sheffield

In the mid-to-late 1980's, so called 'rust belt' cities in the UK began to respond to their industrial decline with local economic development strategies aimed at boosting employment. The strategies involved efforts to diversify traditional manufacturing heartlands into new service sector economies. One feature of the approach was the often rather implausible looking project of creating, out of unpromising material, a new urban sport and tourism industry (Roche 1992b).

Faced with economic and industrial decline in the 1980's, Sheffield. traditionally a manufacturing and steel producing city, forged sport and tourism together as an alternative solution to regenerate its local economy. It was believed that investment in sporting infrastructure, and the staging of the XVI World Student Games would derive long-term economic and social benefits to all sections of the community (Price 1991). Criticised as reactive and quasi-strategic at the time, the longer-term assessment of these radical investment decisions has been overlooked. The value, role and function of major events in the local UK economic development process is therefore less than fully understood.

Challenging the traditional economic base theory relationship between the manufacturing and service sectors of an economy, this thesis investigates whether investment in major events has been a rational approach to assist Sheffield's process of economic development. Utilising Williams' (1997) hypothesis that major events act as basic economic activities; by attracting and retaining external expenditure from sports tourists, the aim of the thesis is to identify whether events act as 'catalysts' to or 'motors' of local economic growth.

Through the application of an expenditure based multiplier approach, five major events, staged in Sheffield between 1996 and 1998, are estimated to have had a collective impact of £10.4 million over a period of twenty-one event days (£495,00 per day). The findings of the research reveal that the staging of major sports events has a significant short-term impact on the local economy. The impact is conditional upon the type, status and duration of the event staged and the , nature of the visitor groups attracted. Extrapolating the results to all events staged in Sheffield since 1990, the thesis estimates that nearly E32 million has been injected into the local economy.

On the basis of the results, the research argues that major events are an important part of the consumer service sector of a local economy. As consumer services they act to stimulate economic growth by importing consumers. While major events are shown to function as basic sector economic activities and catalysts, they are not in themselves large enough to 'motor' a local economy, but are key instruments in diversifying the local economic base.

In conclusion, the thesis recognises that the academic assessment of major events in the UK is relatively immature, and it highlights the need for rigorous evaluation of the broader cost-benefit parameters associated with staging major events. Sporting, cultural, political, social and environmental impacts of major events are a few of the themes lughlighted as areas of future research.