From major sporting events like the FIFA World Cup, the Olympics, Wimbledon, and The World Games, to the evolution of esports and other immersive gaming experiences, Sports are impacting economies worldwide with AI, digital, and emerging tech solutions for broadcasting, merchandising, healthcare, and sports tourism. How will the continued evolution of the sports industry shape the economy in the years to come? 

Table of contents:

• Introduction 
• Factors sports industry impacting the economy
• Final thoughts 

The sports market size has grown strongly in recent years. It will grow from $480.12 billion in 2023 to $506.93 billion in 2024 at a compound annual growth rate (CAGR) of 5.6%. The economic influence of sports goes far beyond ticket sales and merchandise. It spans industries such as tourism, media rights, sponsorships, and employment.

Sports events, whether local, regional, or international, play a key role in boosting economic activity. They draw in spectators who spend money on tickets, accommodation, food, and merchandise, benefiting local businesses and stimulating the economy. 

These events require large teams of workers, creating jobs and increasing wages for many people. Large-scale sporting events like the Olympics or FIFA World Cup generate significant employment opportunities across various sectors. Event planning and management require coordinators, project managers, and logistics planners to oversee schedules, budgets, and venue operations. 

Construction and infrastructure development involve engineers, architects, and construction workers to build or renovate stadiums, transportation facilities, and other essential infrastructure. The hospitality and tourism sectors thrive, employing hotel staff, tour guides, and restaurant workers to accommodate visitors and enhance their experience. 

Security and safety are paramount, necessitating security guards, law enforcement personnel, and emergency response teams to ensure smooth and secure operations.

Media and broadcasting roles, such as journalists, camera operators, and production staff, cover the event and provide live broadcasts, while marketing and sponsorship teams manage promotions, branding, and advertising campaigns. 

Ticketing and customer service staff assist with ticket sales and customer inquiries, and retail and merchandising workers handle the sale of official merchandise. Transport and logistics roles, including drivers and coordinators, ensure the smooth movement of teams, officials, and spectators.

Innovation in sports has completely changed how fans engage with and experience events, with esports leading the way. Esports, or competitive video gaming, has grown into a billion-pound industry, attracting millions of viewers worldwide. Platforms like Twitch and YouTube Gaming have transformed live streaming by providing real-time access to matches and tournaments. 

Major events such as the League of Legends World Championship highlight how esports has bridged the gap between traditional sports and digital entertainment. The use of immersive technologies like virtual reality (VR) and augmented reality (AR) has further enhanced the fan experience, allowing spectators to feel part of the action—whether by virtually entering a stadium or interacting with live content.

Artificial intelligence (AI) is another groundbreaking development in sports, especially for personalising content and improving fan engagement. AI-powered platforms process large amounts of data to deliver customised experiences, such as personalised highlights and predictive analytics for fantasy sports. Industry leaders like IBM and Microsoft use AI to provide real-time insights during live broadcasts, offering fans advanced statistics and interactive dashboards. 

Furthermore, AI-driven chatbots and virtual assistants are revolutionising customer service, making processes like ticket purchases and ordering merchandise quicker and easier.

By exploring the many ways sports contribute to the economy, we can better understand how this dynamic industry helps shape economic policies, urban development, and job opportunities.

How is the sports industry impacting the economy

1. Revenue generation through sports events

According to Statista, the revenue of the global sporting equipment market amounted to more than 160 billion U.S. dollars in 2023, whereas the global sports and active nutrition market was valued at close to 28 billion U.S. dollars in 2022. This growth is largely driven by the increasing commercialisation of sports, the rise of digital broadcasting, and higher fan engagement.

The UEFA EURO 2024, hosted by Germany, generated an estimated $8.18 billion across the nation and its ten host cities. Over 90% of this impact was driven by direct spending from the 2.7 million ticket holders, nearly 44% of whom were international visitors. 

The Olympic Games Paris 2024 generated between USD 7.37 billion and USD 12.21 billion in net economic benefits in the Paris region, with an intermediate scenario estimating a net economic impact of USD 9.79 billion, according to an independent study.

Wimbledon 2024 set a record with a total prize fund of $62.5 million, including $3.375 million for the singles champions. The event also contributed significantly to the Lawn Tennis Association's revenues, with 2023 figures showing $70.125 million, or 51.7% of its total income.

The Ryder Cup 2024 in Rome, Italy, is also expected to deliver significant economic benefits, with the 2018 edition in France having generated US $284 million.

2. Job creation across multiple sectors

A 2020 report by PwC estimated that the global sports industry supports over 11 million jobs worldwide. In the United Kingdom, research by Oxford Economics shows that sports-related employment directly contributes to around 57,000 jobs, including positions within professional leagues, clubs, and support services.

In the United States, the National Football League (NFL) is a significant driver of job creation. Host cities benefit greatly from the economic activity generated during an NFL season. 

The magnitude of the Superbowl's economic contribution reverberates in the statistics: in 2023, when the event was hosted in Arizona, it was found to have generated 10,459 annual jobs, leading to a contribution of $494.1 million to labour income.

Hosting The World Games can create thousands of temporary jobs related to event organisation, venue preparation, and logistics. For instance, the 2022 World Games in Birmingham, Alabama, generated approximately 3,500 jobs.

3. Infrastructure development and urban revitalisation

Hosting large-scale sporting events often requires significant investment in infrastructure, including stadiums, hotels, and transport facilities. These developments have a lasting impact, as the facilities continue to benefit the host city long after the event has ended.

The London 2012 Olympics is a prime example of how sports infrastructure can transform a city. The event led to the regeneration of East London, turning previously neglected areas into modern, vibrant spaces. The Queen Elizabeth Olympic Park, built for the Games, still attracts tourists, supports jobs, and boosts the local economy.

For the Tokyo 2020 Olympics, Japan invested around $25 billion in infrastructure and preparations. This investment not only supported the Games but also left Tokyo with improved public transport systems, housing, and sports facilities that continue to serve the community.

The International World Games Association (IWGA) unveiled a comprehensive Sustainability Strategy for The World Games, aligning with the Organisation for Economic Co-operation and Development (OECD) guidelines to enhance the environmental, economic, and social impact of the event.

Joachim Gossow, CEO of the IWGA, stated, "We are very pleased by the way that The World Games have taken our multi-sport event to the next level. We recognise the progress that we have achieved in the recent editions of The World Games, and we are aiming to follow this track into the future."

Ursula Romero, CEO of ISB TV, stated, "The World Games prioritise sustainability in many ways. For instance, we do not require the construction of new venues; instead, we utilise existing ones, whether permanent or temporary. This approach leaves a lasting legacy for the sports and the local communities. Take Chengdu as an example: after the games, a new park with facilities like disc golf and parkour will remain for the citizens to enjoy.

We have consciously limited the number of participants to 5,000, which is directly tied to sustainability. While it’s impossible to reduce our carbon footprint to zero, we aim to minimise it in a meaningful way. Simply planting trees to offset emissions can sometimes be mere greenwashing, and that's not our goal. Instead, we strive for a balanced approach that is acceptable and makes sense.

We've also worked with the host city in Chengdu to adopt eco-friendly practices, such as reducing waste, exploring new technologies, and using electric vehicles to lower emissions. These are measures that society increasingly expects in daily life, and we bring the same mindset to this event. Where necessary, we even educate our hosts, not just for this event but for the future, helping them refine and improve their sustainability efforts."

4. Sports tourism: A growing economic driver

According to the World Travel & Tourism Council (WTTC), sports tourism generated approximately $828 billion globally in 2019. Importantly, sports tourism also helps during "shoulder seasons"—times when tourism activity is typically lower—providing steady economic support to local communities throughout the year.

Sports tourism is one of the fastest-growing areas in the travel and tourism industry. Fans travel both within their own countries and abroad to attend sporting events, visit stadiums, or take part in sports-related activities. This creates demand for hotels, transport, food services, and entertainment.

Cities like Barcelona and Madrid attract millions of visitors each year. In Barcelona, FC Barcelona’s rich football legacy draws countless tourists to the Camp Nou stadium for matches and tours, making it a key tourism asset.

In countries like Australia, sports tourism accounts for a large share of tourism revenue. Major events such as the Australian Open and the Melbourne Grand Prix are excellent examples of how sports tourism drives economic growth.

The 2024 Australian Open set a new attendance record, with over one million spectators attending the 15-day event at Melbourne Park. This marked an increase from the previous record of 839,192 in 2023. 

In 2024, 9.58% of all Australian Open attendees were from overseas, indicating a notable influx of international tourists during the event.

The 2024 Australian Grand Prix attracted a record-breaking 452,055 attendees over the four-day event, surpassing previous records.

Hosting major sports events not only creates direct revenue for organisers but also provides substantial economic benefits to the host city or nation. Local businesses, including hotels, restaurants, and shops, experience a surge in activity as fans gather to attend games, boosting the local economy significantly.

5. Brand sponsorship and advertising

Sports Sponsorship Market is valued at USD 57.00 Billion in 2020 and is expected to reach USD 89.60 Billion in 2027, growing at a CAGR of 6.72% from 2021 to 2027. Deloitte has reported that sports sponsorships deliver an average return on investment (ROI) of 1.8x, making them an appealing choice for businesses worldwide.

The Air Jordan brand, a partnership between Nike and Michael Jordan, became a global icon in both sports and fashion. In 2020 alone, the Jordan brand generated $3.6 billion in revenue for Nike, highlighting the long-term financial potential of sports sponsorships.

Luxury conglomerate LVMH became a major sponsor of the 2024 Paris Olympics, investing €150 million. This partnership not only enhanced LVMH's global visibility but also underscored the increasing intersection between luxury brands and sports events. KitKat secured a multi-year sponsorship with Formula One starting in 2025. 

State Farm announced a major sponsorship with Unrivalled, a new 3×3 women's basketball league set to launch in January 2025. This partnership highlights the growing investment in women's sports and the recognition of their commercial potential. 

Fantasy gaming platform Dream11 entered into multiple shirt sponsorship deals with IPL teams for the 2024 season, including the Gujarat Titans and Punjab Kings.

Elf Cosmetics partnered with the Indianapolis Motor Speedway and sponsored Katherine Legge, the only woman racing in the 2024 Indy 500. This collaboration signifies the beauty industry's support for female athletes and its efforts to tap into diverse audiences.

The relationship between sports and brands is mutually beneficial. Sponsorships enable brands to reach highly engaged audiences, while sports organisations receive the financial support needed to operate and grow. Brands benefit from the emotional connection fans have with sports, using it to build loyalty, boost recognition, and encourage engagement.

The growing demand for sportswear has propelled brands like Adidas and Under Armour to global success, creating thousands of jobs and driving innovation in athletic clothing and technology. The global sports apparel market size was valued at USD 203.26 billion in 2023 and is projected to grow from USD 211.57 billion in 2024 to USD 298.06 billion by 2032, exhibiting a CAGR of 4.38% during the forecast period. North America dominated the sports apparel market with a market share of 39.56% in 2023. 

Through sports sponsorships, brands achieve more than financial gains—they also enhance visibility and strengthen consumer loyalty. This adds another layer of economic benefit to the sports industry while fostering stronger connections between fans and businesses.

7. Sports and healthcare

The sports industry plays a crucial role in improving public health. Participation in sports and physical activities significantly reduces healthcare costs due to the associated health benefits, such as lower rates of chronic diseases and improved mental well-being. This alleviates pressure on public healthcare systems while encouraging healthier lifestyles.

In the United Kingdom, the NHS (National Health Service) acknowledges the vital role of sports and exercise in maintaining mental and physical health. Initiatives like “Couch to 5K” have been launched to encourage people to become more active. Such programmes not only enhance public health but also help reduce the economic burden of healthcare expenses linked to sedentary lifestyles.

A study published in The Lancet highlighted the global impact of physical activity, suggesting that if everyone worldwide engaged in at least 150 minutes of exercise per week, healthcare costs could be reduced by approximately $100 billion annually.

8. The role of technology in transforming the sports economy

Technological advancements have significantly boosted the economic impact of sports. Innovations such as digital broadcasting, virtual fan engagement, sports betting, and online merchandise sales have opened up new revenue opportunities for sports organisations and brands.

Advancements in digital broadcasting have redefined the way sports are consumed. Streaming platforms like ESPN+, DAZN, and Amazon Prime Video have expanded the reach of sports to global audiences, bypassing traditional cable networks. For example, Amazon secured exclusive rights to broadcast Thursday Night Football in the United States, bringing in substantial revenue through subscriptions and targeted advertisements. Additionally, sports leagues such as the NBA and Premier League monetise highlights and live streams via social media platforms like YouTube and Twitter, providing fans with on-demand content while generating advertising revenue.

Virtual engagement technologies, including augmented reality (AR), virtual reality (VR), and fan apps, have enhanced the fan experience while driving economic growth. AR-based features like the NFL’s “augmented replays” allow fans to access real-time statistics during live games, creating an interactive viewing experience. VR innovations, such as those offered by NextVR (acquired by Apple), let fans virtually attend live games, expanding the reach of ticket sales to a global audience. Fan engagement apps, like the Manchester United Official App, provide exclusive content, merchandise access, and gamification, encouraging fan loyalty and spending.

Legalised sports betting has emerged as a major revenue driver in recent years. The global sports betting market was valued at $83 billion in 2022 and is expected to grow at a CAGR of 10.3% until 2030. In the United States, partnerships between sportsbooks and sports leagues, such as the NFL’s collaboration with DraftKings and FanDuel, generate revenue through licensing deals, advertising, and data-sharing agreements. Sports betting also boosts game-day engagement, with fans more likely to watch games they’ve bet on, increasing viewership and advertising value.

E-commerce has transformed merchandise sales into a global phenomenon. Platforms like Fanatics and club-specific stores allow fans worldwide to purchase official gear, regardless of location. For instance, Fanatics reported $3.4 billion in revenue in 2022, driven by exclusive partnerships with the NFL, NBA, and FIFA. Customisation options, such as personalised jerseys, further enhance fan loyalty and increase sales. Innovations in digital payment systems and expedited delivery services ensure seamless transactions, encouraging repeat purchases.

A prime example of this is the NBA’s partnership with technology companies, enabling them to stream games, offer virtual experiences, and use advanced sports analytics. By engaging fans through virtual reality and live-streaming, the NBA has managed to reach a global audience and generate extra revenue.

In 2020, the global sports technology market was valued at around $17.9 billion, with an expected annual growth rate of 21.4% until 2026. This reflects the growing influence of technology in the sports industry.

Furthermore, fantasy sports and online betting have created new economic prospects. In the United States, the sports betting market was valued at approximately $6.5 billion in 2021 and is projected to reach $10 billion by 2028, further demonstrating the economic potential of these emerging markets.

Final thoughts 

The economic impact of sports extends well beyond ticket sales and merchandise. Through generating revenue, creating jobs, developing infrastructure, promoting sports tourism, enhancing branding, supporting health initiatives, and advancing technology, sports play a key role in transforming modern economies. This sector not only drives economic growth but also strengthens communities by providing opportunities and encouraging healthier lifestyles. As sports continue to evolve and incorporate new technologies, their economic influence is likely to expand, offering fresh prospects for industries and economies worldwide.

Sports have become a crucial part of the global economy, driving innovation, employment, and progress across various industries. The figures demonstrate the importance of investing in and supporting sports as a vital element of economic strategy for countries and regions worldwide.

Key takeaways:

• Sports events generate significant revenue through ticket sales, broadcasting rights, sponsorships, and merchandise, boosting local economies.
• The sports industry creates millions of jobs worldwide, spanning various sectors like coaching, marketing, and event management.
• Hosting major sports events often leads to infrastructure development and urban revitalisation, with long-term benefits for local communities.
• Sports tourism is a growing economic driver, attracting global visitors and supporting industries like hospitality and transport.
• Brand sponsorships and advertising provide financial support for sports organisations while offering businesses valuable exposure and consumer loyalty.
• Technological advancements, such as digital broadcasting and sports betting, are expanding revenue opportunities and reshaping the sports economy.