An economic impact study conducted by Arizona State University’s department of economics found the 2022 WM Phoenix Open generated $453.7 million in Arizona’s economy.
As part of the total economic impact, the study, commissioned by The Thunderbirds — hosts of the WM Phoenix Open — also reported a total state of Arizona gross domestic product contribution of $276.8 million and an annual employment impact of 4,290 jobs, according to a press release.
The study used an Implan model to estimate economic impacts for the state of Arizona, which is a commercially licensed input-output model developed and maintained by the Minnesota Implan Group Inc. and used by professional economists to assess impacts of economic activities on a local economy.
“We’re proud to see our once small golf tournament in the middle of the desert grow into a crucial source for economic development and growth not only in the Phoenix area, but everywhere in Arizona,” said Michael Golding, 2022 WM Phoenix Open Tournament chairman and current president of Thunderbirds Charities, in the release.
“We take great pride in the positive experiences we provide our fans, and together with our corporate partners, we will continue to draw all types of visitors and businesses to the Valley,” Golding added.
The study defined and estimated economic impact as the increase in spending and therefore economic vitality in a community as a result of the existence of an event or organization.
For the WM Phoenix Open and surrounding events, this included the expenditures of visitors who identified the WM Phoenix Open as the key factor in visiting Arizona, media from outside Arizona who cover the event, the “organizational spending” by The Thunderbirds, media and event production companies, diverse organizations and businesses involved in operations, event production and activation of sponsorships, plus the indirect and induced multiplier effects.
The study also focused on estimating the total gross economic impact (gross output) of the 2022 tournament, which includes the total amount of direct spending by out-of-town visitors and organizations in metro Phoenix, and indirect and induced impacts of those expenditures.
For the purpose of the study, a visitor was defined as any individual who does not live in the metro Phoenix area for any portion of the year. As a result, no resident expenditure was used to generate the economic impact estimates. Dual-state residents were excluded from the study.
“The economic impact results reveal the power of professional sports and how a single event can have such a positive impact on a region,” said WM president and CEO Jim Fish. “WM is very proud of what we continue to accomplish together with The Thunderbirds through the WM Phoenix Open for the benefit of the community and the environment. Helping communities thrive and empowering people to live more sustainably is a key priority for WM.”
The Thunderbirds, the PGA Tour and others associated with the tournament injected an additional $55.4 million in direct expenditures from staging and attending the tournament, the release stated.
These expenses include tents and equipment, food and beverage, administration, signs, parking and security, hotel rooms leading up to and during the event for the players, caddies, PGA TOUR employees and out-of-town media, to name a few.
Economic activity of more than $220 million was induced by visitors’ and organizations’ expenditures — up from $195 million in 2017. The release stated the total gross output associated with visiting media, PGA participants and all other organizational expenditures is up 68.8% from the previous study.
This figure was calculated using the Implan economic assessment software with Arizona-specific multipliers. This number is additional impact because of what is referred to as the multiplier effect, or the spending and re-spending of money through the local economy.
When the indirect impact is combined with the direct impact, out-of-town media expenditure ($1.7 million) and total organizational expenditure, the total economic impact becomes $453.7 million, the release explained.
In addition, the economic activity spurred by the event created incremental state and local sales tax revenues.
The direct sales tax revenue generated from out-of-state visitors, media, and PGA participants at the 2022 WM Phoenix Open is estimated at $17.6 million. Direct sales tax revenue was estimated to be $13 million, through combined direct fiscal impacts in the city of Scottsdale ($2.9 million), Maricopa County ($1.9 million) and the state ($9.3 million).
The 2023 WM Phoenix Open will take place Feb. 6-12 at TPC Scottsdale. “The People’s Open” has been named the Tournament of the Year by the PGA Tour four times to acknowledge the tournament’s legendary status as one the most unique events in golf.
The 2023 edition will mark the 88th playing of the event and the 14th with WM as the title sponsor.
The Thunderbirds were founded in 1937 with the mission of promoting the Valley of the Sun through sports. The Thunderbirds consist of 55 “active” members and more than 280 “life” members who have helped the tournament eclipse $175 million in charitable giving since its inception in 1932.
For information on The Thunderbirds or the 2023 WM Phoenix Open, visit www.wmphoenixopen.com.