Dr Julie Stevens

For the past ten years, I’ve fo­cused my re­search on sup­port­ing lead­ers and or­gan­i­sa­tions through­out the sport sys­tem in Cana­da and the world. Over time, I’ve con­nect­ed with many lo­cal stake­hold­ers to help them cham­pi­on com­mu­ni­ty sport in their city or town. One of the most com­mon re­quests I hear from my part­ners is the need to gath­er sport im­pact in­for­ma­tion. Peo­ple re­quire ac­cu­rate ev­i­dence to at­tract fund­ing for sport.

While I al­ways cham­pi­on the so­cial val­ue sport pro­vides to a com­mu­ni­ty, con­vinc­ing key de­ci­sion-mak­ers to sup­port in­clu­sive and af­ford­able sport and recre­ation pro­grammes you and your neigh­bours can ac­cess is get­ting more com­plex. To en­sure this mes­sage is loud and clear – it’s time to make the case for sport by show­ing its eco­nom­ic val­ue!

Tra­di­tion­al­ly, the eco­nom­ic im­pact of sports has fo­cused on sports tourism, specif­i­cal­ly eval­u­at­ing sports events. The dom­i­nant ap­proach is as­sess­ing the eco­nom­ic im­pact on the to­tal dol­lar val­ue. Key in­for­ma­tion about the sport event’s con­tri­bu­tion to the Gross Do­mes­tic Prod­uct (eco­nom­ic ac­tiv­i­ty), em­ploy­ment (job cre­ation), and pub­lic rev­enue (tax gen­er­a­tion) is cal­cu­lat­ed. Then, the event hosts lever­age this ev­i­dence to lob­by the gov­ern­ment and busi­ness­es to sup­port their cur­rent and fu­ture events.

There are two chal­lenges with this ap­proach. First, the eco­nom­ic im­pact as­sess­ment re­quires fi­nan­cial and hu­man re­sources to com­plete and, as a re­sult, usu­al­ly on­ly fo­cus­es on large-scale events. It fails to cap­ture the val­ue of many small and medi­um-sized sport events. Sec­ond—and more im­por­tant­ly—an eco­nom­ic im­pact sport event fo­cus is too nar­row. This view miss­es the broad­er val­ue of sport, recre­ation, and well­ness to a re­gion­al econ­o­my.

So – what’s the so­lu­tion? A re­cent de­vel­op­ment in track­ing the eco­nom­ic con­tri­bu­tion of sport in­volves a new frame­work called the Ac­tive Econ­o­my. The frame­work was de­vel­oped by a team of re­searchers led by Drs David Finch and David Legg at Mount Roy­al Uni­ver­si­ty in Cal­gary, Al­ber­ta, Cana­da. Lo­cal sport ad­vo­cates were shocked when the 2018 ref­er­en­dum to host the 2026 Win­ter Olympic Games was de­feat­ed. In the af­ter­math, lead­ers sought to con­vince city of­fi­cials, busi­ness and non-prof­it lead­ers, and the gen­er­al com­mu­ni­ty to in­vest in poli­cies to build an ‘ac­tive city’ move­ment. The Ac­tive Econ­o­my frame­work caught my eye, and I won­dered if oth­er com­mu­ni­ties could use it to mea­sure sports’ val­ue in their re­gion­al econ­o­my.

An ac­tive econ­o­my is a unique eco­nom­ic clus­ter in­cor­po­rat­ing ten in­ter­de­pen­dent sec­tors in two macro-lev­el groups: de­liv­ery and en­abling. The three de­liv­ery sec­tors are or­gan­ised sport, ac­tive recre­ation, and ac­tive tourism. The sev­en en­abling sec­tors are health and well­ness, ap­par­el and ac­ces­sories, equip­ment, me­dia, pro­fes­sion­al ser­vices, de­sign and in­fra­struc­ture, and sports bet­ting! The Ac­tive Econ­o­my al­so en­com­pass­es all for-prof­it, not-for-prof­it, and pub­lic or­gan­i­sa­tions and in­di­vid­u­als who di­rect­ly or in­di­rect­ly con­tribute to the sup­ply chain of sport, recre­ation, and well­ness goods and ser­vices across the clus­ter’s ten sec­tors.

Over­all, the con­cept of an Ac­tive Econ­o­my clus­ter is a valu­able tool for show­ing how sport can dri­ve re­gion­al eco­nom­ic de­vel­op­ment by con­nect­ing it to oth­er high-pro­file in­dus­tries. Amaz­ing­ly, the glob­al ac­tive econ­o­my was es­ti­mat­ed to be worth $3 tril­lion in 2020. In 2022, Cal­gary’s Ac­tive Econ­o­my was re­port­ed to in­cor­po­rate 4,000 en­ter­pris­es, em­ploy 43,000 peo­ple, and con­tribute $3.3 bil­lion to the re­gion­al econ­o­my. My re­search on the Ni­a­gara Re­gion in On­tario, Cana­da, found the Ac­tive Econ­o­my was val­ued at $890 mil­lion, or 4 per cent of the re­gion’s nom­i­nal GDP. It pro­vid­ed over 10,000 jobs and in­clud­ed over 1,000 busi­ness­es.

When com­pared to oth­er high-pro­file sec­tors of Ni­a­gara’s econ­o­my, the val­ue of the ac­tive econ­o­my clus­ter was more than trans­porta­tion and ware­hous­ing and slight­ly less than ac­com­mo­da­tion and food ser­vices, which is a sig­nif­i­cant in­dus­try in the re­gion. The Ac­tive Econ­o­my al­so equalled 74 per cent of two ma­jor sec­tors: whole­sale and re­tail trade and pro­fes­sion­al/tech­ni­cal ser­vices.

The eco­nom­ic ev­i­dence gen­er­at­ed by the Ac­tive Econ­o­my builds aware­ness about the sig­nif­i­cant val­ue sport, recre­ation, and well­ness bring to a re­gion­al econ­o­my. The Ac­tive Econ­o­my is an emerg­ing sec­tor com­prised of mul­ti­ple sec­tors that of­fers nu­mer­ous busi­ness­es and not-for-prof­its new growth op­por­tu­ni­ties.

What is the next step? In 2024, Ja­maica, for ex­am­ple, did not host any of the T20 Crick­et World Cup match­es. The gov­ern­ment’s re­sponse was that the cost-ben­e­fit analy­sis was not favourable. It is pos­si­ble that if the Ac­tive Econ­o­my mod­el had been ap­plied, the out­come may have been dif­fer­ent.

The Ac­tive Econ­o­my mod­el of­fers a more com­pre­hen­sive eval­u­a­tion of sport im­pact and can be used world­wide. Caribbean ad­min­is­tra­tors and re­searchers may con­sid­er us­ing this ap­proach in fu­ture eval­u­a­tions.

Dr Julie Stevens is a Pro­fes­sor, De­part­ment of Sport Man­age­ment, Brock Uni­ver­si­ty, Cana­da and a Vis­it­ing Schol­ar, Fac­ul­ty of Sport, Uni­ver­si­ty of West In­dies