Sports Economy Set to Reach $8.8 Trillion by 2050, But Physical Inactivity and Climate Threats Risk Billions Without Urgent Action
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The sports economy is projected to reach $8.8 trillion in annual revenue by 2050, yet rising physical inactivity and escalating climate and nature risks threaten up to $517 billion of this revenue by 2030. Without
Original sourceAI Summary
The global sports economy is projected to grow to $8.8 trillion by 2050, but risks from physical inactivity and climate threats could lead to significant revenue losses. A new report highlights the importance of stakeholder collaboration in mitigating these risks and ensuring sustainable growth in the sector.
Sentiment Rationale
The growth in the sports economy could drive increased demand for MRSH's risk management services. Markets often react positively to insights that align consulting services with emerging growth sectors, evidenced by the consulting boom in accelerating markets.
Trading Thesis
Long MRSH due to potential growth in sports sector, targeting short-term gains.
Market-Moving
- The sports economy's projected growth could enhance MRSH's advisory revenue.
- Increased focus on sustainability may lead to higher demand for MRSH's risk services.
- Collaborations with stakeholders on sustainability present new business opportunities.
- Potential losses in sports sector could raise insurance demand, benefiting MRSH.
Key Facts
- Global sports economy aims for $8.8 trillion by 2050.
- Potential losses could hit $1.6 trillion due to inactivity and climate risks.
- Sport generates $2.3 trillion annually, expected to grow 10% CAGR until 2030.
- Rising physical inactivity threatens future fan engagement and revenue streams.
- Four growth drivers identified to spur sports economy resilience and growth.
Companies Mentioned
- Oliver Wyman (N/A): Consulting firm under MRSH contributing to sports economy insights.
- World Economic Forum (N/A): Partnering in report highlighting sustainability issues in the sports sector.
Industry News
This falls under 'Industry News' as it outlines significant growth and challenges within the sports economy. Understanding these dynamics is crucial for investors in MRSH, impacting its strategic positioning and revenue potential in the consulting and risk management spaces.
The sports economy is projected to reach $8.8 trillion in annual revenue by 2050, yet rising physical inactivity and escalating climate and nature risks threaten up to $517 billion of this revenue by 2030. Without coordinated multistakeholder action, potential losses could increase to as much as $1.6 trillion by 2050. This is according to Oliver Wyman, a global leader in management consulting and a business of Marsh (NYSE:MRSH), which today released Sports for People and Planet, a report produced in collaboration with the World Economic Forum.
Tony Simpson, Partner and Sports Practice Leader at Oliver Wyman, said: "As well as exploring key growth drivers that are shaping the global sports economy, this report identifies three distinct pathways that reflect sport's unique impact, including championing resource stewardship, placing sport at the heart of cities and catalysing purpose-driven capital flows. This analysis has the potential to help organisations with investment and risk, as well as with insurance considerations that support this industry."
Sebastian Buckup, Managing Director, World Economic Forum, said: "Sport blends economic power and cultural influence in ways few other sectors can match. This paper illustrates how public, private and civil society leaders can harness that potential to shape a new model of prosperity that delivers not only financial returns, but healthier societies and thriving natural ecosystems — outcomes that are imperative for sustained economic growth and societal well-being."
This new report reveals sport generates $2.3 trillion annually in total revenues. With projected compound growth of 10% over the next five years, the sector is expected to reach $3.7 trillion by 2030, with long-term forecasts indicating expansion to $8.8 trillion by 2050. However, sport's long-term growth is at risk due to converging health and environmental challenges.
Rising levels of physical inactivity, especially among youth, risk undermining grassroots participation and eroding the future fan and consumer base that sustains revenues across apparel, elite events, tourism and fitness.
Simultaneously, escalating environmental risks such as heat stress, extreme weather and pollution are disrupting competitions, diminishing spectator experiences, limiting community well-being and impacting the supply chains and operations that underpin the broader sports economy.
The sector also contributes to these pressures through the resource-intensive nature of events, sporting goods, infrastructure and travel, resulting in significant carbon emissions, water use and waste generation.
To combat potential loss, this report explores pathways that actively shape the conditions needed to create more active societies and thriving natural ecosystems, as well as four key growth drivers shaping the future of the sports economy: the acceleration of sports tourism, the emergence of sport as an asset class, the mainstreaming of women's sports, and the rebalancing of sport's growth with emerging economies.
Sports for People and Planet Insight Report is conducted by the World Economic Forum's Centre for Nature and Climate. Oliver Wyman is a strategic partner of the World Economic Forum.
About the study
This report was complied with input from over 130 independent sources and collaboration with world governments, professional leagues, media and entertainment groups and the investment community.
About Oliver Wyman
Oliver Wyman is a business of Marsh (NYSE:MRSH), a global leader in risk, reinsurance and capital, people and investments, and management consulting, advising clients in 130 countries. With annual revenue of over $24 billion and more than 90,000 colleagues, Marsh helps build the confidence to thrive through the power of perspective. For more information, visit oliverwyman.com, or follow us on LinkedIn and X.
About World Economic Forum
The World Economic Forum provides a global, impartial, not-for-profit platform and insights to support meaningful connections between political, business, academic, civil society and other leaders. (www.weforum.org).
View source version on businesswire.com: https://www.businesswire.com/news/home/20260113844000/en/
Media contacts:
Oliver Wyman
Matthew Harrison
+44 (0)7990 802 830
matthew.harrison@oliverwyman.com
World Economic Forum
public.affairs@weforum.org