Opening Day: baseball stimulus for Maryland

Nick Sohr —  April 6, 2012 — Leave a comment

By Nick Sohr, Managing Editor, MDbizMedia

When the Baltimore Orioles host the Minnesota Twins on Friday afternoon the game will mark the start of an 81-game, baseball-fueled stimulus for the Maryland economy.

The true impact of the season is impossible to divine before the first pitch is thrown, but win or lose, the O’s are big business for Maryland.

On no day is that more clear than Opening Day.

“Fourteen straight losing seasons, yadda yadda,” said economist Anirban Basu, chairman and CEO of Sage Policy Group Inc. “Opening Day, the impact doesn’t change because it’s a sellout.”

Orioles clubhouse on opening day. Photo from the official Baltimore Orioles twitter feed. @Orioles

Basu authored the last economic impact study of the Orioles for the Maryland Stadium Authority in 2007.

He found the team was responsible for nearly $167 million in business activity during the 2006 season. The team supported 2,452 jobs and $72.6 million in personal income that year.

Guessing at the team’s impact last season, however, is tricky.

Attendance has dropped. In 2006, the 81 games at Oriole Park at Camden Yards brought out an average of 26,581 fans, according to espn.com. Last year, 80 home games averaged 21,943 fans.

But factor in inflation, higher ticket prices — the team raised most single-game ticket prices last year between $1 and $8 — and other changes at the ballpark, and the picture is more cloudy.

For the 20th anniversary of Camden Yards, the team and stadium authority have spruced up the park with new seats, fresh concessions and other upgrades. Instead of peanuts and Crackerjacks, fans can chow down on Rockfish tacos and burgers topped with crab cakes.

“In real terms, I’m guessing that the impact has waned, but they just had the stadium refreshed,” said Basu. “That stimulated construction.”

Higher ticket prices are a mixed bag, too.

On one hand, shelling out more for admission leaves less to spend elsewhere. But, Basu said, higher prices also mean the average fan in the stands will have greater spending power than those who caught ballgames there in years past.

“It’s not clear what the implication of that is. It’s hard to know how to take that into account from an economic impact perspective,” said Basu. “That money is going to the Orioles and to the players, and to the extent that they don’t live in Maryland, it’s hard to determine what the impact is here.”

And as painful as it can be for Orioles fans to see the stadium full of Yankees and Red Sox hats, visiting fans traveling to Camden Yards to catch their favorite teams offer a greater benefit to the economy, bringing money from out-of-state to spend in Maryland.

In 2006, some 31 percent of the 2.5 million attendees came from outside of Maryland. And 10.5 percent, or nearly 270,000, stayed overnight, according to Basu’s report.

“The good news about being in the AL East is we’re in the same division as two of the most hallowed names in baseball,” Basu said. “Their fans travel. That helps us economically. The big economic impact is out-of-town visitors because of their tendency to spend more and [stay in hotels]. Once someone commits to staying overnight, that triggers a whole series of positive economic events.

“The more fans from out of town that come to Oriole Park at Camden Yards, the more money we have to market the city. The multiplier can be very high in terms of tourism and leisure.”

The correlation between winning and attendance is unshakable, however. The top of the attendance lists are dominated by contenders. Teams like the Boston Red Sox and Philadelphia Phillies perennially average attendance higher than their stadiums’ listed capacities.

“A better pitching staff would create a better economic impact,” said Basu. “They need a No. 4 hitter, a more reliable bullpen and so on and so forth. They don’t have a bad lineup. You have [Nick] Markakis,[Matt] Wieters and [Adam] Jones, it’s not a bad lineup. So I don’t know [about the 2012 season].”

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