1
Minnesota Ski Areas Association: Economic Impact Study Final Report : 2012/2013 Fiscal Year
February 2014
Executive Summary Minnesota has nineteen ski and snowboard areas spread across the state. Minnesota has a strong tourism economy and winter sports, whether its snowmobiling, ice-‐fishing, cross-‐country skiing or alpine skiing and snowboarding, play a key role in the overall tourism economy of the state.1 Winter activities are often the key link to the overall tourism economy in rural Minnesota; providing jobs when needed most and providing a vital counterbalance to the typical summer/fall orientation of rural tourism economies. This report is the result of a study to document the economic value of the alpine ski and snowboard industry in Minnesota. The report includes demographics, participation, and other characteristics of residents of Minnesota who alpine ski and snowboard.
Total Economic Impact
An estimated 308,000 people in Minnesota2 (about 6% of the population) participate in alpine skiing and snowboarding, of which an estimated 210,000 visited one or more Minnesota ski areas and an estimated 98,000 did not visit a Minnesota ski area, but rather skied/ snowboarded out of state. More than half of survey respondents are part of a household with children at home, with an average household size of 3.5 people, including 2.7 people who ski/snowboard. The average age of respondents is 40.4 years (median of 42 years), with an average household income of $107,000 (median of $88,000). Alpine skiing/snowboarding is an active outdoor recreation that can and is enjoyed by people of all ages with family and friends during the Minnesota winter from October/November through March/April.
1 Explore Minnesota Tourism, Tourism and Minnesota’s Economy, 1/31/14. 2 Estimate of the number of skiers and snowboarders living in Minnesota is derived from the NSAA National Demographic Study, 2012/13
2
• Total Output Effect. The total direct and secondary output effects of the alpine ski and snowboard resort industry in Minnesota are $401.2 million for the 2012/13 season.
Table 1
Total Economic Impact (Direct and Secondary), 2012/13
Aggregate
Effect Total direct ski area visitor expenditures $193,186,374 Total retail-‐specific expenditures (equipment, apparel, accessories) + $89,622,514 Total Skier and Snowboarder Spending $282,808,888 Direct output ratio (margin adjustment) 0.82 Direct output effect $231,903,288 Secondary output ratio (statewide) 0.73 Secondary output effect (statewide) $169,289,401 Total output (direct and secondary) $401,192,689
• Direct Spending. Total direct aggregate ski area visitor spending is $193.2 million. Of this total, approximately 51 percent goes directly to ski area businesses, and 49 percent goes to other businesses (65% in the case of overnight skier visits).
• Retail Specific Expenditures. An additional component of the economic benefit of alpine skiing and snowboarding in Minnesota is retail expenditures made specifically for the sports – equipment, apparel, and accessories. The direct expenditures in this retail segment are estimated at $89.6 million (excluding purchases made at ski area-‐owned shops).
• Impact beyond Ski Area Businesses. Aggregate direct consumer spending at businesses other than the ski area, retail spending, and secondary spending accounts for 75% ($302.8 million) of the total economic impact of $401.2 million.
3
Skier and Snowboarder Spending
The total direct spending from Minnesota skiers and snowboarders (sum of ski area visitor spending, both on and off mountain, plus related retail spending) was roughly $282.8 million for the 2012/13 season.
Table 2 Total Skier and Snowboarder Spending, 2012/13
Day Visitor Spending
On-‐Mountain Spending $67,836,703 Off-‐Mountain Spending + $38,419,969 Total Day Visitor Spending $106,256,672
Overnight Visitor Spending
On-‐Mountain Spending $30,505,927
Off-‐Mountain Spending + $56,423,775 Total Overnight Visitor Spending $86,929,702
Total Retail Expenditures $89,622,514
Grand Total Skier and Snowboarder Spending $282,808,888
• Per Person Per Day Spending. Day visitors spend an average of $91.82 per day, including
$58.62 on-‐mountain and $33.20 off-‐mountain, and $130.26 per day including secondary outputs. Overnight visitors exhibit a higher average, at $335.17 overall ($117.62 on-‐mountain and $217.55 off-‐mountain), and $475.47 per day including secondary outputs.
Table 3 Per Person Per Day Skier/Snowboarder Spending, 2012/13
Spending per person per day (Day Visitor)
On-‐Mountain Spending $58.62 Off-‐Mountain Spending + $33.20 Per Person Per Day Spending (Day Visitor) $91.82 Per Person Per Day Spending with Secondary Output (Day Visitor) $130.26
Spending per person per day (Overnight Visitor)
On-‐Mountain Spending $117.62
Off-‐Mountain Spending + $217.55 Per Person Per Day Spending (Overnight Visitor) $335.17 Per Person Per Day Spending with Secondary Output (Overnight Visitor) $475.47
4
• Total Visits in Minnesota. Ski areas in Minnesota recorded 1.42 million alpine ski and snowboard visits in 2012/13, of which 82 percent (or 1.16 million) were day visits and 18 percent (or 260,000) were visits as part of an overnight trip. Visits by Minnesotans comprised 92 percent of the 1.42 million (1.30 million), with the remaining 100,000 from non-‐residents (including about half from residents of Wisconsin). Minnesota ranks 8th in the U.S. in terms of overall skier visits, with 1.9 million skier visits by Minnesota residents to ski areas across North America. As well, Minnesota is in the top 15 in the U.S. in terms of skier visits per capita.
• Visits by Minnesotans Outside the State. The NSAA National Demographic Study estimates that residents of Minnesota generate 1.9 million alpine ski or snowboard visits, and yet only 1.3 million of those visits are captured within Minnesota. In other words, approximately 600,000 alpine ski and snowboard visits by Minnesota residents occur outside the state (“leakage”), with nearly one-‐third (98,000) of Minnesota’s 308,000 skiers not visiting a Minnesota ski area during the 2012/13 season. It is estimated that 28 percent of this leakage is day visits (the percent that currently occur in Wisconsin) and the remaining 72 percent are visits to states that require overnight stays (e.g. Colorado, Montana, Utah and Michigan). The total value of this leakage is estimated at $161.6 million in direct spending and $229.2 in aggregate economic value.
Thus, a significant economic opportunity exists if a portion of these visits could be re-‐captured by Minnesota ski areas. For example, if one-‐quarter of these leaked skier visits (151,000) occurred in Minnesota at the proportion of 28 percent day visits and 72 percent overnight visits, it would generate an additional $40.4 million in direct spending and $57.3 million in aggregate economic value.
Additional Economic Benefits
Several additional economic benefits are attributable to the presence of ski areas in Minnesota; wages, income and charitable contributions.
• Employment value. In terms of employment generated in the alpine ski and snowboard industry, the estimate is that these businesses directly employ over 3,680 people. Total employment at both ski areas and at other businesses that benefit from the off-‐mountain expenditures are estimated at 8,024 jobs. Wages and salaries paid to these total employees is $140.4 million.
• Charitable contributions. Ski area businesses in Minnesota are estimated to have donated nearly $300,000 worth of donations (cash and in-‐kind) during the 2012/13 fiscal year.