The Convention Industry Council (CIC) has released a new study declaring the importance of the meetings industry. The study, titled The Economic Significance of Meetings to the U.S. Economy, reveals that the meetings industry plays a critical role in sustaining jobs as well as revenue. It is the first-ever study in this variety of its size and scope.
According to the study, the meetings and events industry directly supports 1.7 million jobs, a $106 billion contribution to the national GDP, $263 billion in spending, $60 billion in labor revenue, $14.3 billion in federal tax revenue and $11.3 billion in state and local tax revenue.
“Two years ago, the value of meetings, one of America’s top economic and social engines, was misunderstood by governments and the public,” Karen Kotowski, Executive Director of the CIC. “This new research quantifies the economic significance of our sector for legislators, regulators and economists alike.”
Until now, the value of the industry has been hard to measure due to lack of research and statistics. PwC US, a research and services firm established in the late 1800s, and a team of industry researchers, spent more than a year conducting research and analysis on the 1.8 million meetings that take place across the country each year.
The study was spearheaded by an alliance of 14 organizations representing the collective meetings, travel, exhibitions and events industries in the U.S. brought together by the CIC.
“As the nation grapples with effective ways to work its way out of a recession, the meetings industry plays a critical role in supporting jobs in communities across America, creating environments that foster innovation, consensus and business success,” said Kotowski.
The Economic Significance of Meetings to the U.S. Economy was based around the United Nation’s World Tourism Organization’s (UNWTO) specific definition of a meeting. Meetings are defined as a gathering of 10 or more participants for a minimum of four hours in a contracted venue. Meetings include conventions, conferences, congresses, tradeshows and exhibitions, incentive events, corporate/business meetings and others.
The study builds on past research that has demonstrated the value of face-to-face meetings. In 2009, leading global research firm Oxford Economics established the first clear link between business travel and business growth, proving that for every dollar invested in industry travel, businesses experienced an average of $12.50 in increased revenue and $3.80 in new profits.
“Working side-by-side creates dynamic environments where handshakes convert to commerce, insight translates to innovation and knowledge sharing creates a better educated and more competitive workforce,” said Kotowski. “Meetings are how business gets done in virtually every state, city and town in America. They are the very definition of working together and are essential to help win our future.”
The research for The Economic Significance of Meetings to the U.S. Economy involved two key areas: the collection of primary data through surveys, and research and analyses of industry, government and other secondary data. Data collected in early to mid-2010 was for the most recent complete year (2009). Over 6,000 surveys were collected from meeting organizers, meeting venue managers, destination marketing organizations, meeting delegates, and exhibitors. PwC then compared the data with secondary data, identified any discrepancies or potential sampling bias, and developed estimates for volume and spending that incorporated the primary and secondary research, professional judgment, and industry experience.
Of the 1.8 million meetings per year, 1.3 million are classified as corporate or business meetings, 270,000 are conventions, conferences or congresses, 11,000 are trade shows and 66,000 are incentive meetings. The 1.7 million jobs created by these meetings is larger than many other industries, including broadcasting and communications (1.3 million), and computer and electronic product manufacturing (1.1 million).
The meeting industry’s 1.7 million jobs generate $60 billion in labor income. A total of $263 billion is spent on goods and services resulting from meetings and events. The majority of direct spending, $151 billion, is related to meeting planning and production, venue rental and other non-travel tourism-related commodities.
The $263 billion in spending also generates $14.3 billion in federal tax revenue and $11.3 billion in state and local tax revenue. And meetings’ $106 billion contribution to the U.S. GDP is greater than, for example, auto manufacturing ($78 billion).
The study also found that meetings generate 250 million overnight stays by 117 million Americans and 5 million international attendees. A total of $113 billion is spent on lodging, food service and transportation each year.
Delegates attending these meetings spent an overall of $145 billion on attendance-related items.
As far as revenue is concerned, meetings activity provides $907 billion in total economic output to the U.S. The total economic output also includes a $458 billion value-added contribution to GDP, 6.3 million full-time and part-time jobs, $271 billion in labor income including wages and salaries, benefits and proprietors’ income, $64 billion in federal tax revenue and $46 billion in state and local tax revenue
“The results of our comprehensive research demonstrate the significance of the meetings industry as a major contributor to the U.S. economy,” said Robert Canton, director, convention & tourism practice, PwC US. “New and proven research standards, as well as definitions provided by the UNWTO allowed for the measurement of U.S. economic activity resulting from face-to-face meetings.”
The measurement of meetings’ success will only help further the growth of the industry by presenting this data to legislators and lawmakers.
“We see the positive force that meetings provide every day through our client events – the benefits they provide in fostering new business ideas and relationships are just as important to our future as the economic impact,” said Jack Sammis, president and CEO of IMN Solutions. “Both sides are important, and we need to communicate that to policymakers, the business community and the public at every opportunity. Thanks to this study, we now have the tools to demonstrate their full impact.”
The Economic Significance of Meetings to the U.S. Economy comes at a time when the financial system relies heavily upon steady business practices and the evaluation of their success.
“Fortunately, we are seeing a steady recovery in the meetings industry,” said Katherine Markham, Co-Founder and Principal of ConventionPlanit.com. “The fact that this study measured data for 2009, one of the toughest years for the meetings industry, shows that meetings are an even greater force in the economy than most people realize. The data for 2010 and beyond are no doubt even stronger.”
|People on the Move|