By Jude Althagafi

In 2024, Paris will capture the world’s attention once again as it hosts the Summer Olympics for the third time. The Paris 2024 Games are anticipated to bring success for the city beyond the limits of athletic excitement. The Olympics and the global sports industry as a whole have power to grow economies outside of just competition.

Before Paris secured the Games, a 2016 impact study by the French Center for Sports Law and Economics projected financial gains ranging from €5.3 billion to €10.7 billion, with tourism alone accounting for approximately a third of the total. This is in parallel to the global growth in the sports industry, from merchandise, to sales, to viewership, to tickets, and more. Globally, the sports market experienced growth, with its value rising from $486.61 billion in 2022 to $512.14 billion in 2023 and the growth is projected to continue at a CAGR of 5%. The significant financial influence of sports on cities and economies is undeniable. Mega sporting events often serve as a turning point for financial, social, and infrastructure growth, benefiting both developed and emerging economies. We’ve seen this in the 2008 Olympics in Beijing where modernized infrastructure such as brand-new railway systems continue to benefit the city today. The year Beijing won the bid to host the 2008 Olympic Games, China's urbanization rate was at 37% in 2001, and in 2022 it was 64%. China’s success makes it clear that mega sporting events act as a stage for cities and nations to the world, opening up opportunities for development agendas to brand, re-brand, and transform countries.

The sports industry is more than just a game

Nearly 2 million jobs have been created from the Beijing Olympic Games in 2008. The construction industry, retail and wholesale, finance, and IT industries have all had a boost in employment in Beijing. When France hosted the 1998 FIFA World Cup across its regions, the impact created around 1.2 million more jobs in those regions, and the 2024 Games are expecting similar results. Before being elected as the host city for the Olympics, Paris 2024 prioritized employment opportunities. Early planning revealed that the Games would encourage the creation of an estimated 150,000 jobs across various sectors such as event management, tourism, hospitality, and construction. The organizers of Paris 2024 collaborated with unions, vocational training providers, recruitment agencies, and public bodies to craft an employment strategy that maps out the needed skills ahead of the games. Tony Estanguet, President of Paris 2024, emphasized their inclusive approach, stating, "We aim to engage individuals who may feel disconnected from the Games or believe they have no place in this industry." In 2018, France’s main trade union and employer organizations made a Paris 2024 commitment to a job strategy that involves local small businesses and long-term unemployed to meet the demands of the 2024 Games. The job strategy includes:

• Involving state, local, and private entities to give priority to hard-to-reach job seekers.

• Endorsing a public procurement structure that considers the unique circumstances of French SMEs and incorporates social and environmental commitment clauses into all tender notices (reserving a minimum of 10 percent of the working hours generated by procurement.)

• Providing programs for developing careers and sector-based advanced skill training during the Games hosting term with web job-seeking platforms (EMPLOIS 2024) that offer an open database and training for all jobs anticipated for the Games.

As we approach the Games this summer, the anticipation of its success for the city is high as plans to transform the local economy are underway.

The economic growth in small U.K. cities

Major events like the Qatar FIFA World Cup in 2022 expect major returns. Qatar’s economy expanded by 4.8% in the year after hosting the Cup. But economic growth doesn’t necessarily need investment in major events. The sports industry, not only mega-events, can contribute heavily to the creation of new jobs. As we've seen in the UK, the Premier League, contributed £7.6 billion to the country's Gross Value Added in the 2019–20 season and generated 94,000 new jobs, according to a 2022 report. Small towns like Huddersfield felt a £5 million surge when their football club hit the Premier League. Spectator sports aren't just about match-day buzz; they're a catalyst for local growth through ticket sales and long-term infrastructure investments.

Not all sporting investments are a guaranteed success

Year after year, countries bid to host mega-events for the anticipation of driving infrastructure and increased trade, foreign investment, or tourism post-event, even when it requires an obscene amount of money. But not all investments turn into successful ones as we’ve witnessed in the 2012 London Olympics where the regeneration of East London completely revitalized the area. There have been instances where countries have faced financial losses from hosting. Brazil suffered for both the FIFA World Cup 2014 and the Olympics in 2016. There were cases of overspending on stadiums and infrastructure projects, while social development was overlooked. Most venues became underutilized after the events, causing ongoing maintenance costs and long-term economic losses. The 2014 Sochi Winter Olympics was one of the most expensive Olympic Games in history, with infrastructure costs over $55 billion, 4.5 times the planned $12 billion with little investment on social development. Since then, many of the facilities in Sochi, similar to Brazil, have become underutilized, requiring annual maintenance expenses, and the investment has continued to be costly today.

A local and human approach to sports

Sporting investments don’t necessarily have to focus on infrastructure alone to expect a positive outcome. As we’ve seen in Brazil and Russia, if investments are primarily focused on infrastructure, with little attention paid to social investments, countries are more likely to suffer long-term losses. In Beijing, training to learn new languages and skills were a rising trend to meet the demands of tourism and future FDI goals with results proving to be more sustainable. As anticipation builds for the upcoming Summer Games, Paris has evidently learned from past instances of overspending, opting to prioritize social investment rather than just infrastructure. While sports undeniably bring great economic influence, their impact is far-reaching across multiple sides of a country, creating jobs and boosting the quality of life.