Introduction & Executive Summary
A summary of the key findings have been provided in this section. The full report should be read in its entirety to understand the background, methods, and assumptions underlying the study's findings.
Background & Objectives
Over the past several decades, the meetings sector has emerged as a significant contributor to national economies; however, the value of the sector has been difficult to measure due to a lack of research and consistency within and among various countries. In 2006, the United Nations World Tourism Organization (UNWTO), along with the International Convention and Congress Association (ICCA), Meeting Professionals International (MPI), and Reed Travel Exhibitions, spearheaded an initiative to measure the economic activity of meetings on a national scale. The UNWTO and its partners developed definitions for meetings, recommended a methodology to quantify meetings activity through an extension of national tourism satellite accounts, and created a pilot program and guidelines for individual countries to quantify meetings activity.
As a result of the UNWTO's initiative, efforts to measure the economic significance of meetings have gained momentum in recent years. For example, the MPI Foundation Canada sponsored a study (released in 2008) that quantified the economic contribution of meetings activity in Canada (The Economic Contribution of Meetings Activity in Canada). However, research that specifically addresses the economic significance of meetings in the United States has been limited. With enhanced scrutiny on the meetings sector in recent times, the Convention Industry Council (CIC) initiated a plan to demonstrate the value of face-to-face meetings and study the economic significance of the meetings in the U.S. A CIC Task Force, which included the following leading industry organizations, was formed to support this effort:
- American Hotel and Lodging Association (AH&LA)
- Association of Destination Management Executives (ADME)
- Convention Industry Council (CIC)
- Destination Marketing Association International (DMAI)
- Destination & Travel Foundation Financial & Insurance Conference Planners (FICP)
- International Association of Conference Centers (IACC)
- International Association of Exhibitions and Events / Center for Exhibition Research / Exhibition
- Industry Foundation
- International Special Events Society (ISES)
- Meeting Professionals International (MPI) & MPI Foundation
- National Speakers Association (NSA)
- Professional Convention Management Association (PCMA) / PCMA Education Foundation
- Site & Site Foundation U.S. Travel Association
PricewaterhouseCoopers LLP (PwC) was engaged by CIC to lead the effort of estimating the economic significance of meetings in the U.S. in 2009. Assisting PwC in this effort was a team of industry researchers (the Economic Significance Study Research Task Force or "the RTF"), which included representatives of ASAE, DMAI, Destination & Travel Foundation, MPI, PCMA, and U.S. Travel Association. This study represents the first definitive, quantitative, and research-based analysis of the economic contribution of face-to-face meetings to the U.S. economy.
It should be noted that this study seeks to quantify the "economic significance" of meetings, which should not be confused with the "economic impact." For purposes of this study, the concept of "impact" is reserved for changes to the economy that may result from a specific event or shock to the industry, whereas the "significance" or "contribution" measures the size and overall significance of the sector within an economy. Key objectives for this study included:
- Develop common data and language that stakeholders can use when discussing meetings and events.
- Provide data that can be used at the national level to articulate the economic contribution that meetings and events represent to the overall economy.
- Provide a basis for ongoing benchmarking, forecasting, and trend analysis.
- Collect reliable data that can be used to influence government and international agencies to alter national statistics systems to include aspects of the economic activity of meetings and extend tourism satellite accounts to include and reveal meeting activities related to tourism.
- Adopt the definitions and approach developed by the UNWTO to estimate the contribution of the meetings industry comparable to measures for other countries.
- Develop a replicable methodology that allows for meaningful comparative benchmarking internationally.
- While this study aims to achieve ambitious objectives, it is also important to acknowledge certain limitations of the study.
- The definition of meetings is based on guidelines established by the UNWTO, which specifically exclude meetings of a certain type, size, length, and location. As such, the study does not capture the full potential contribution of all meeting-related activity. The economic activity associated with this segment specifically excluded from the study may be significant.
- Other effects of meetings such as those on productivity, knowledge sharing/training, and social benefits were not evaluated as part of this study.
- This study presents the economic significance of meetings at the national level and thus the meeting characteristics and economic activity for a particular destination will vary from these national estimates.
The definitions and guidelines outlined by the UNWTO served as a foundation for this study. For the definition of meetings, UNWTO and its partners define meetings as a general term indicating the coming together of a number of people in one place to confer or carry out a particular activity. The key purposes of meetings are to motivate participants, conduct business, share ideas, and learn. Based on further refinement by the UNWTO and for purposes of this study, the term "meeting" and its description above was defined to refer to a gathering of 10 or more participants for a minimum of four hours in a contracted venue. Meetings included conventions, conferences, congresses, trade shows and exhibitions, incentive events, corporate/business meetings, and other meetings that meet the aforementioned criteria. Meetings excluded social and recreation activities, certain educational and political activities, and gatherings for sales of goods/services such as consumer shows.
UNWTO also outlined components of the meetings sector to include "core" meetings industries (specialized meetings organizers; convention, congress, and exhibition centers; incentive houses and destination management companies; and convention and visitor bureaus) and extend the sector to other supporting entities such as accommodations, transportation, technical equipment, food services, speakers' representation services, stand construction, other support services, and auxiliary businesses. Several of the above industries such as accommodations, transportation, and food services also relate to travel and tourism activity. Given the overlap of meetings and travel and tourism activty, UNWTO recommended that components of the meeting sector be identified through a complimentary set of tables to a nation's tourism satellite account. For the purposes of this study, an extended approach to quantifying the significance of meetings activity was used, which captures the activities of the core meetings industries, meetings-related components of the travel and tourism industries as an extension of the Travel & Tourism Satellite Account (TTSA), and other relevant industries.
Research was a critical step in the process for quantifying the economic significance of meetings. The study team of PwC and the RTF conducted an extensive research effort involving two key areas: the first involved the collection of primary data through surveys, and the second involved research and analyses of industry, government, and proprietary sources (collectively referred to as secondary data). Surveys and secondary data covered both the supply-side and demand-side of the meetings sector related to meeting volume and spending. Over 6,000 surveys were received from meeting organizers (both "in-house" and "independent/third-party"), meeting venue managers, destination marketing organizations, meeting delegates, and exhibitors.
These research and analysis efforts were conducted in parallel to each other, whereby PwC analyzed the results of each effort and reconciled the data and analyses to develop the basis for the estimates of economic significance. PwC compared survey results with secondary data, identified any discrepancies and potential sampling bias, and developed estimates for volume and spending that incorporated the primary and secondary research, professional judgment, and industry experience. Please note that throughout this report, figures were rounded and that some totals and subtotals may not add due to this rounding.
Meetings Volume Estimates
Based on the study's findings, in 2009 nearly 1.8 million meetings took place in the U.S, with these meetings attended by an estimated 205 million participants. As illustrated in Table 1, the majority of these meeting participants (52 percent) attended corporate/business meetings, followed by 25 percent attending conventions/conferences/congresses.
Direct spending estimates provided the building blocks for estimating the total economic significance of meetings. Direct spending is defined as spending within the U.S. economy from purchases of goods and services attributable to the activity. Total direct spending associated with U.S. meetings activity in 2009 is estimated at over $263 billion. This spending is presented at the commodity level in Table 2. As illustrated, $113 billion or 43 percent of the direct spending in the meetings industry is on travel and tourism commodities such as lodging, food service, and transportation; hence, that portion is already captured by the Travel & Tourism Satellite Account. However, the majority of direct spending is not travel-related, with $151 billion or 57 percent involving meeting planning and production costs, venue rental, and other non-travel & tourism commodities that fall outside the TTSA--suggesting the reach of the meetings industry affects the U.S. economy broadly.
In other words, the meetings sector can be described as being comprised of two portions: one portion overlapping (or an extension of) the travel and tourism sector and the remaining portion belonging to other sectors. Of the $708 billion in direct tourism output in the U.S. in 2009, $113 billion or 16 percent is the result of the meetings industry.
Total Economic Significance
Direct spending, which served as input for the input-output economic modeling process, reflects the spending in those industries that comprise the meetings industry. Indirect spending is attributable to the suppliers to the meetings industry, and the induced spending arises from spending by the employees of the meetings industry and its suppliers. Together, direct, indirect, and induced spending contributions comprise the total contribution of meetings activity to the U.S. Economy.
Economic contributions are presented in terms of the following:
Output: Economic concept akin to sales or revenue.
Contribution to GDP: Also known as the "value added." Refers to the additional value created at a particular stage of production. It is a measure of the overall importance of an industry. Value added consists of: employee compensation, proprietors' income, income to capital owners from property, and indirect business taxes.
Employment: Consisting of full-time and part-time jobs.
Labor income: Including wages and salaries, benefits, and proprietors' income.
Taxes: Including federal taxes (personal income, excise, custom duty, social insurance contribution, and other taxes) and state and local taxes (corporate income, personal income, property, sales, social insurance contribution, and other taxes).
The economic significance of meetings activity in terms of output, contribution to GDP, employment, and labor income are presented in Table 3. As illustrated, total output for 2009 related to meetings activity is estimated at $907 billion, while the total contribution to GDP is $458 billion. Meetings activity supported 6.3 million jobs and generated $271 billion in total labor income.
The tax effects of the meetings were also significant in 2009, with $64 billion in federal taxes generated by the industry, and an additional $46 billion at the state and local level, as presented in Table 4.
Meetings Direct Contribution to GDP Compared to Other Industries
According to the Bureau of Economic Analysis (BEA), U.S. GDP in 2009 totaled $14.1 trillion. As presented previously, in Table 3, the meetings industry directly contributed $106 billion to this total. While this in and of itself may not seem significant, it is helpful to provide further context by comparing this direct contribution to GDP and employment associated with meetings activity to other U.S. industries. Other industry contributions were based on 2009 data released by the BEA on a NAICS code level. As illustrated in Table 5, the meetings industry ranks higher than several high-profile industries, both in terms of its contribution to U.S. GDP, and the number of full- and part-time workers employed. Study findings at a glance