The coronavirus pandemic has left the sports world's future very unclear. There is still no certainty as to when the major sports leagues in America can resume play, even as we enter the third month quarantine. And with the sports world on hold, so is the revenue stream for the leagues. The economical ramifications of it all is staggering.
According to analysis from ESPN, leagues will ultimately lose $12 billion in revenue -- as well as hundreds of thousands of jobs -- due to the stoppage of sports. It may get worse. The study notes that the dollar amount of lost revenue may double if NFL and college football seasons are canceled due to COVID-19.
These financial loses are far reaching in the industry. Everyone from stadium workers to youth sports complexes to television networks have been out of work since COVID-19 spread to the United States.
Rishe took a closer look at some publicly available data to see what the impact has been on sports. Rishe worked with a labor market analytics firm to come up with the numbers. The figures assume that the NBA and NHL will have to cancel the remainder of their seasons, which is not a safe assumption just yet. Recent reports claim that the while the . In addition, the analysis takes into account the belief that Major League Baseball and Major League Soccer can return this summer and play a portion of their respective seasons.
Aspects such as the price of a ticket to a sporting event and the costs of concessions and parking in included in the analysis as well. In total the report breaks the losses down like this:
- $3.25 billion would've been spent by fans on professional sports
- $371 million in wages have been eliminated.
- Television revenue stands to lose $2.2 billion
- Youth sports could lose $2.4 billion that would've boosted the tourism industry.
- Rishe estimates that professional sports stand to lose $5.5 billion while collegiate sports will lose $3.9 billion
"As an economist, you stand back, you look at the carnage that's taking place -- dumbfounded, awestruck, mind-numbing," Patrick Rishe, who directs the sports business program at Washington University in St. Louis, told ESPN. "All of those phrases, they're all relevant because we just have never seen anything on this scale."
A lot of the numbers to depend on if sports can return at some point this summer. It's unknown if that is a possibility right now.