Two years ago, meetings were under attack. While industry leaders were eager to defend face-to-face events, they had few hard facts with which to convince business executives and government officials of the bottom-line value of meetings. That won’t happen again, says the Convention Industry Council, which has just released a major report on the topic.
The new Economic Significance of Meetings to the U.S. Economy study estimates that 205 million people attended nearly 1.8 million meetings in the U.S. in 2009. Those meetings generated $263 billion in direct spending, supported 1.7 million jobs, and contributed $106 billion to the gross domestic product. The study was conducted by PricewaterhouseCoopers for the CIC and funded by 14 of its constituent associations.
"After a time in which our industry was significantly misunderstood and vilified to a certain extent, we needed common data to demonstrate the contribution this industry makes to jobs, the economy, and taxes,” said Bruce MacMillan, president and chief executive officer, Meeting Professionals International, speaking at a press conference on February 17. "Now we have that benchmark data, and we can demonstrate once and for all the significant economic impact that meetings have on the economy. Now we can tell our story in Washington or in small communities across the country," he added.
MacMillan was joined at the press conference by CEOs of six of the other supporting organizations, including Roger Dow, U.S. Travel Association; Deborah Sexton, Professional Convention Management Association; John Graham, ASAE; Michael Gehrisch, Destination Marketing Association International; and Joe McInerney, American Hotel and Lodging Association; as well as CIC CEO Karen Kotowski and Robert Canton, director of the U.S. conventions and tourism practice at PricewaterhouseCoopers.
Meetings and Meeting Spend
The report defines a meeting as a gathering of 10 or more participants for a minimum of four hours in a contracted venue to motivate participants, conduct business, share ideas, and learn. Of the 1.8 million meetings held in 2009, here’s how they break down:
- 1,266,620 corporate or business meetings (71 percent of the total), attended by 107 million people (52 percent of all attendees),
- 269,800 conventions, conferences, and congresses (15 percent), attended by 51 million people (25 percent),
- 66,000 incentive meetings (4 percent), attended by 8 million people (4 percent),
- 10,700 trade shows (1 percent), attended by 25 million people (12 percent), and
- 178,000 “other meetings” (7 percent), attended by 13 million people (7 percent).
PWCs Canton said these are conservative numbers, given the fact that the study looked at meetings held in 2009, one of the worst years for the meetings industry.
Of the $263 billion in direct spend on meetings in 2009, $151 billion (57 percent) went toward meeting–related commodities and $113 billion (43 percent) to travel costs. Canton called the higher percentage of meeting-planning–related spend one of the big surprises of the report.
The top three meeting–related commodities in 2009 were
- food and beverage ($34 billion)
- audiovisual/staging services ($12 billion), and
- meeting venue rental ($10 billion).
The top three meeting-travel expenses in 2009 were
- accommodations ($35 billion),
- food and beverage ($26 billion), and
- air transportation ($18 billion).
Corporate meetings accounted for 50 percent of the $263 billion in direct spend. Conventions, conferences, and congresses made up 28 percent, followed by trade shows at 13 percent, incentives at 5 percent, and other meetings at 4 percent.
Researchers also looked at the $263 billion in direct spending in terms of attendance-related spending by delegates, exhibitors, and other attendees. Participants, they found, spent about $145 billion on meetings (55 percent of the $263 billion total). Registration fees and other expenses (which include floor space) was the largest single expenditure in this category at $66 billion, representing 46 percent. Accommodations ($25 billion), food and beverage ($19 billion), and air transportation ($13 billion) were the next largest.
On average, meetings generated $1,290 in spending per participant, but that number was highest for incentive meetings. The study calculated per-attendee spending for five meeting types:
- incentives: $1,620,
- conventions: $1,430,
- trade shows: $1,360,
- corporate meetings $1,230, and
- other ($850).
Also, meetings generated 250 million room nights, with corporate meetings accounting for 55 percent of the total, conventions 27 percent, trade shows 9 percent, incentives 5 percent, and other meetings 4 percent. About 85 percent of meetings take place at hotels, while 7 percent are held at convention or conference centers without sleeping rooms, and 8 percent are at other venues, (such as universities, theaters, and museums). AHLA’s McInerney said that meetings represent about 30 percent of all hotel room nights.
Drilling down on the meeting attendee stats, researchers found that 41 percent of attendees are considered “local” (within 50 miles), 57 percent are “domestic” (traveled farther than 50 miles and stayed overnight), and 2 percent are international.
GDP and Jobs
According to the report, the meetings industry employs 1.7 million people, more than the broadcasting, communications, or rail transportation industries. About 95,000, or 6 percent, of the jobs are specific to the meetings industry (meeting organizers, planners, venues). Another 68 percent are in the tourism industries (food and beverage, accommodations, air transportation, etc.). The remaining 26 percent of the jobs are in other industries. The 1.7 million jobs created $60 billion in labor income. Graham pointed out that every meeting supports three meetings industry jobs.
Also, meetings directly generate $14 billion in federal tax revenue and $11 billion in state and local tax income.
The study further drives home its message about the importance of the meetings industry to the economy, noting that meetings directly contribute $106 billion to the GDP, which is more than auto manufacturing, performing arts/spectator sports/museums, and air transportation.
The impact of the meetings industry is even larger when you consider the indirect and induced contributions to the economy—that is, money spent by industry suppliers on meetings and in the economy. Including direct, indirect, and induced contributions, meetings generate $907 billion in spending, contribute $458 billion to the GDP, support 6.3 million jobs, and represent $271 billion in labor income and $110 billion in tax revenue.
"We needed this study to validate the value of face-to-face meetings,” said PCMA’s Sexton. “This data did not exist prior to now. We had anecdotal data." It also puts a spotlight on the meeting professional and the important role the individual plays within the organization, she added. "We can't find ourselves in the same situation we had two years ago where no one understood the value of what this industry brings to cities, to states, to the country, and to the world for that matter.”
Further details on the study and the organizations that funded it can be found at MeetingsMeanBusiness.com.