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Minnesota  Ski  Areas  Association:  Economic  Impact  Study                                                  Final  Report  :    2012/2013  Fiscal  Year  

February  2014  

Executive Summary Minnesota  has  nineteen  ski  and  snowboard  areas  spread  across  the  state.    Minnesota  has  a  strong  tourism  economy  and  winter  sports,  whether  its  snowmobiling,  ice-­‐fishing,  cross-­‐country  skiing  or  alpine  skiing  and  snowboarding,  play  a  key  role  in  the  overall  tourism  economy  of  the  state.1  Winter  activities  are  often  the  key  link  to  the  overall  tourism  economy  in  rural  Minnesota;  providing  jobs  when  needed  most  and  providing  a  vital  counterbalance  to  the  typical  summer/fall  orientation  of  rural  tourism  economies.    This  report  is  the  result  of  a  study  to  document  the  economic  value  of  the  alpine  ski  and  snowboard  industry  in  Minnesota.  The  report  includes  demographics,  participation,  and  other  characteristics  of  residents  of  Minnesota  who  alpine  ski  and  snowboard.      

Total  Economic  Impact  

An  estimated  308,000  people  in  Minnesota2  (about  6%  of  the  population)  participate  in  alpine  skiing  and  snowboarding,  of  which  an  estimated  210,000  visited  one  or  more  Minnesota  ski  areas  and  an  estimated  98,000  did  not  visit  a  Minnesota  ski  area,  but  rather  skied/  snowboarded  out  of  state.  More  than  half  of  survey  respondents  are  part  of  a  household  with  children  at  home,  with  an  average  household  size  of  3.5  people,  including  2.7  people  who  ski/snowboard.  The  average  age  of  respondents  is  40.4  years  (median  of  42  years),  with  an  average  household  income  of  $107,000  (median  of  $88,000).    Alpine  skiing/snowboarding  is  an  active  outdoor  recreation  that  can  and  is  enjoyed  by  people  of  all  ages  with  family  and  friends  during  the  Minnesota  winter  from  October/November  through  March/April.  

 

                                                                                                               1  Explore  Minnesota  Tourism,  Tourism  and  Minnesota’s  Economy,  1/31/14.  2  Estimate  of  the  number  of  skiers  and  snowboarders  living  in  Minnesota  is  derived  from  the  NSAA  National  Demographic  Study,  2012/13  

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• Total  Output  Effect.  The  total  direct  and  secondary  output  effects  of  the  alpine  ski  and  snowboard  resort  industry  in  Minnesota  are  $401.2  million  for  the  2012/13  season.  

 Table  1  

Total  Economic  Impact  (Direct  and  Secondary),  2012/13  

   Aggregate  

Effect  Total  direct  ski  area  visitor  expenditures   $193,186,374  Total  retail-­‐specific  expenditures  (equipment,  apparel,  accessories)   +  $89,622,514  Total  Skier  and  Snowboarder  Spending   $282,808,888      Direct  output  ratio  (margin  adjustment)   0.82  Direct  output  effect   $231,903,288      Secondary  output  ratio  (statewide)   0.73  Secondary  output  effect  (statewide)   $169,289,401      Total  output  (direct  and  secondary)   $401,192,689  

 

• Direct  Spending.  Total  direct  aggregate  ski  area  visitor  spending  is  $193.2  million.    Of  this  total,  approximately  51  percent  goes  directly  to  ski  area  businesses,  and  49  percent  goes  to  other  businesses  (65%  in  the  case  of  overnight  skier  visits).      

• Retail  Specific  Expenditures.  An  additional  component  of  the  economic  benefit  of  alpine  skiing  and  snowboarding  in  Minnesota  is  retail  expenditures  made  specifically  for  the  sports  –  equipment,  apparel,  and  accessories.  The  direct  expenditures  in  this  retail  segment  are  estimated  at  $89.6  million  (excluding  purchases  made  at  ski  area-­‐owned  shops).      

• Impact  beyond  Ski  Area  Businesses.    Aggregate  direct  consumer  spending  at  businesses  other  than  the  ski  area,  retail  spending,  and  secondary  spending  accounts  for  75%  ($302.8  million)  of  the  total  economic  impact  of  $401.2  million.  

   

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Skier  and  Snowboarder  Spending  

The  total  direct  spending  from  Minnesota  skiers  and  snowboarders  (sum  of  ski  area  visitor  spending,  both  on  and  off  mountain,  plus  related  retail  spending)  was  roughly  $282.8  million  for  the  2012/13  season.    

Table  2  Total  Skier  and  Snowboarder  Spending,  2012/13  

 Day  Visitor  Spending  

   

On-­‐Mountain  Spending   $67,836,703       Off-­‐Mountain  Spending   +  $38,419,969  Total  Day  Visitor  Spending   $106,256,672  

     Overnight  Visitor  Spending    

 On-­‐Mountain  Spending   $30,505,927  

    Off-­‐Mountain  Spending   +  $56,423,775  Total  Overnight  Visitor  Spending   $86,929,702  

     Total  Retail  Expenditures   $89,622,514  

     Grand  Total  Skier  and  Snowboarder  Spending   $282,808,888  

 • Per  Person  Per  Day  Spending.    Day  visitors  spend  an  average  of  $91.82  per  day,  including  

$58.62  on-­‐mountain  and  $33.20  off-­‐mountain,  and  $130.26  per  day  including  secondary  outputs.  Overnight  visitors  exhibit  a  higher  average,  at  $335.17  overall  ($117.62  on-­‐mountain  and  $217.55  off-­‐mountain),  and  $475.47  per  day  including  secondary  outputs.  

 

Table  3    Per  Person  Per  Day  Skier/Snowboarder  Spending,  2012/13  

 Spending  per  person  per  day  (Day  Visitor)  

   

On-­‐Mountain  Spending   $58.62       Off-­‐Mountain  Spending   +  $33.20  Per  Person  Per  Day  Spending  (Day  Visitor)   $91.82  Per  Person  Per  Day  Spending  with  Secondary  Output  (Day  Visitor)   $130.26  

     

Spending  per  person  per  day  (Overnight  Visitor)    

 On-­‐Mountain  Spending   $117.62  

    Off-­‐Mountain  Spending   +  $217.55  Per  Person  Per  Day  Spending  (Overnight  Visitor)   $335.17  Per  Person  Per  Day  Spending  with  Secondary  Output  (Overnight  Visitor)   $475.47  

 

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• Total  Visits  in  Minnesota.  Ski  areas  in  Minnesota  recorded  1.42  million  alpine  ski  and  snowboard  visits  in  2012/13,  of  which  82  percent  (or  1.16  million)  were  day  visits  and  18  percent  (or  260,000)  were  visits  as  part  of  an  overnight  trip.  Visits  by  Minnesotans  comprised  92  percent  of  the  1.42  million  (1.30  million),  with  the  remaining  100,000  from  non-­‐residents  (including  about  half  from  residents  of  Wisconsin).    Minnesota  ranks  8th  in  the  U.S.  in  terms  of  overall  skier  visits,  with  1.9  million  skier  visits  by  Minnesota  residents  to  ski  areas  across  North  America.    As  well,  Minnesota  is  in  the  top  15  in  the  U.S.  in  terms  of  skier  visits  per  capita.  

• Visits  by  Minnesotans  Outside  the  State.  The  NSAA  National  Demographic  Study  estimates  that  residents  of  Minnesota  generate  1.9  million  alpine  ski  or  snowboard  visits,  and  yet  only  1.3  million  of  those  visits  are  captured  within  Minnesota.  In  other  words,  approximately  600,000  alpine  ski  and  snowboard  visits  by  Minnesota  residents  occur  outside  the  state  (“leakage”),  with  nearly  one-­‐third  (98,000)  of  Minnesota’s  308,000  skiers  not  visiting  a  Minnesota  ski  area  during  the  2012/13  season.    It  is  estimated  that  28  percent  of  this  leakage  is  day  visits  (the  percent  that  currently  occur  in  Wisconsin)  and  the  remaining  72  percent  are  visits  to  states  that  require  overnight  stays  (e.g.  Colorado,  Montana,  Utah  and  Michigan).    The  total  value  of  this  leakage  is  estimated  at  $161.6  million  in  direct  spending  and  $229.2  in  aggregate  economic  value.    

Thus,  a  significant  economic  opportunity  exists  if  a  portion  of  these  visits  could  be  re-­‐captured  by  Minnesota  ski  areas.    For  example,  if  one-­‐quarter  of  these  leaked  skier  visits  (151,000)  occurred  in  Minnesota  at  the  proportion  of  28  percent  day  visits  and  72  percent  overnight  visits,  it  would  generate  an  additional  $40.4  million  in  direct  spending  and  $57.3  million  in  aggregate  economic  value.    

Additional  Economic  Benefits  

Several  additional  economic  benefits  are  attributable  to  the  presence  of  ski  areas  in  Minnesota;  wages,  income  and  charitable  contributions.    

• Employment  value.    In  terms  of  employment  generated  in  the  alpine  ski  and  snowboard  industry,  the  estimate  is  that  these  businesses  directly  employ  over  3,680  people.    Total  employment  at  both  ski  areas  and  at  other  businesses  that  benefit  from  the  off-­‐mountain  expenditures  are  estimated  at  8,024  jobs.    Wages  and  salaries  paid  to  these  total  employees  is  $140.4  million.    

• Charitable  contributions.    Ski  area  businesses  in  Minnesota  are  estimated  to  have  donated  nearly  $300,000  worth  of  donations  (cash  and  in-­‐kind)  during  the  2012/13  fiscal  year.