The New Hampshire Ski Industry, 2012-2013: Its Contribution to the State's Economy
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THE NEW HAMPSHIRE SKI INDUSTRY, 2012-2013: ITS CONTRIBUTION TO THE STATE'S ECONOMY Prepared for Ski New Hampshire, Inc. Post Office Box 528 North Woodstock, New Hampshire 03262 by Dr. Daniel S. Lee Dr. Mark J. Okrant Project Economist Project Director The Institute for New Hampshire Studies Plymouth State University January 2014 THE NEW HAMPSHIRE SKI INDUSTRY, 2012-2013: ITS CONTRIBUTION TO THE STATE'S ECONOMY Executive Summary It was estimated that a total of 3.26 million people visited the ski areas in New Hampshire for recreational purposes during the period between May 2012 and April 2013. It was also estimated that approximately $359.0 million was directly spent at and away from ski areas within the state. This $359.0 million direct spending represents 7.9 percent of total traveler spending in the state and 16.2 percent of traveler spending in the state’s northern and western five regions during the period between May 2012 and April 2013. The share of skier spending is even greater during the winter five month skiing season; direct skier spending at and away from ski areas was $300.4 million, which represents a whopping 45.3 percent of total traveler spending in the state’s five northern and western travel regions during the winter five month skiing season. A combined total of direct and secondary spending was approximately $1.1 billion. The annual average employment of 11,067 jobs was supported by direct and secondary spending at and away from ski areas during the period between May 2012 and April 2013. This was 1.3 percent of all employment statewide and 4.0 percent of all jobs in the five northern and western travel regions on an annual basis during the period between May 2011 and April 2012, the last period for which payroll and employment data is available. The contribution of the ski industry during the winter five month skiing season is much greater. During the winter season, 7.8 percent of all employment in these five travel regions would be directly or indirectly dependent on spending by skiing parties. It was estimated that ski area visitor direct and secondary spending resulted in a total of $32.3 million in state government taxes and fees, which was 8.1 percent of all state government taxes and fees paid by all travelers during the period between May 2012 and April 2013. An additional $29.0 million were paid in taxes and fees to the local governments. Table 5 reports detailed information on government receipts. The study showed how vulnerable the ski industry can be to snowfall changes. From the 2011-12 season (of low snowfall) to the 2012-13 season (of better-than-average snowfall), days with snow cover increased by 85 percent, and as a result, the number of visitor days to ski areas rose by more than 20 percent. Even in a low-snowfall year, though, the contribution level of the skier spending to the region’s economy remains high in terms of its share of all traveler spending. It was estimated that the skier spending’s share of the total tourist spending in the northern and western travel regions of the state was 45 percent during the 2011-12 ski season, nearly on par with 45.3 percent during the 2012-13 ski season. This speaks volumes about the importance of the ski industry to the regional economy during the winter season. In sum, the importance of the contribution that the ski industry makes to the state’s economy cannot be emphasized enough. Its contribution is particularly important for the northern regions of the state. During the winter five month skiing season, skier spending makes up nearly half of total traveler spending in the northern and western travel regions. The direct and secondary spending of skiers supports 7.8 percent of all jobs in these regions during the skiing season. This magnitude of the ski industry’s contribution is reflected in the national statistics as well. The U.S. Census Bureau reports that, in terms of ski revenue per capita, New Hampshire ranks the fourth highest after Vermont, Colorado, and Utah in 2007. Furthermore, the ski industry fuels economic growth in the state by bringing money from outside the state. This is particularly important for the northern regions of the state that lack industrial bases other than the tourism sector. The National Ski Areas Association (NSAA) survey shows that about 66 percent of the skiers who visited the state during the 2012-13 skiing season were non-residents. The non-resident share in total spending would be even higher since non-residents are more likely to stay overnight and spend more. Table 1: SKI INDUSTRY’S CONTRIBUTION SUMMARY, May 2012-April 2013 Ski All Tourists % Share Visitor Days 3,262,652 53,126,558 6.1% Direct Spending $359 $4,517 7.9% Direct Payroll $137 $1,578 8.7% Direct Employment 7,835 60,862 12.9% State Gov. Receipts $32 $397 8.1% Local Gov. Receipts $29 $503 5.8% The dollars are expressed in millions of fiscal year 2012 dollars. The number of jobs is expressed in terms of number of jobs per each million of traveler spending. Payroll includes wage and salary disbursements, supplements to wages and salaries, and proprietors’ incomes. Government receipts were estimated from a combined total of direct and secondary spending. Payroll and employment data for all tourists are for the period of May 2011 – April 2012, while others are for the period of May 2012 - April 2013. Figure 1: Receipts Per Capita for Skiing Facilities, 2007 Receipts per capita Vermont Colorado Utah New Hampshire Maine Montana New Mexico Oregon Idaho Washington West Virginia $0 $50 $100 $150 $200 $250 $300 Source: U.S. Census Bureau: Economic Census 2007 The data represents ski facilities without accommodations (NAICS: 71392). Figure 2: Share of Direct Skier Spending in Total Direct Traveler Spending in Five Northern and Western Travel Regions during Skiing Season 2012-13 All Other Skier Spending, Traveler 45.3% Spending, 54.7% Source: Estimation by author Visitors to Ski Areas The 2012-13 skiing season attracted the fifth largest number of alpine skiers in the state’s history. Ski NH’s survey of New Hampshire ski areas shows that there were 2,276,370 alpine skier and snowboarder visits at the state's twenty alpine ski areas. There were also 151,676 Nordic skier days at eleven Nordic ski areas and the seven alpine ski areas which also offered Nordic skiing during the 2012-13 season. It was estimated that an additional 216,036 visitor days occurred during the skiing season that can be directly tied to the ski areas. These visitor days included about 113,058 people who went tubing and 102,978 who enjoyed other recreational activities such as ziplining, indoor wall climbing, and trampolines. Finally, the ski areas estimated that they had 618,570 visitor days during the non-skiing summer and fall season. These visitors rode on tramways and ski lifts, went mountain biking and ziplining, and attended concerts and other events at the ski areas. This summer and fall season visitor days was estimated to have been on the rise recently, and made up 19% of the total visits to the state’s ski areas during the 2012-13 season. Figure 3: Composition of Visitors to New Hampshire Ski Areas, May 2012 – April 2013 Other winter recreation, Summer visitor, 102,978 618,570 Tubing, 113,058 Nordic skier, Alpine skier / 151,676 snowboarder, 2,276,370 Source: New Hampshire Ski Areas survey 2013 and Ski NH survey 2013 Numbers are in visitor days. Total Direct Spending Visitors to the state’s ski areas spent an estimated $300,374,000 during the 2012-13 skiing season, and an additional $58,635,000 during the 2012 summer and fall seasons, for a combined total of $359,009,000 during the period between May 2012 and April 2013. This direct spending led to an estimated $786,491,000 in secondary sales within the state of New Hampshire. Secondary sales include such items as hotel and restaurant purchases from suppliers, ski area purchases of electricity, state and local taxes and employees' earnings and purchases. The total direct and secondary sales spending was $1,145,500,000. All skier spending and their monetary impacts are measured in fiscal year 2012 dollars throughout this paper. As a result, visitors to the 31 ski areas in New Hampshire generated 7.9 percent of the $4.52 billion in estimated total tourist direct spending in New Hampshire during the period between May 2012 and April 2013. If the Seacoast and Merrimack Valley travel regions are not included in this calculation, then the visitors to ski areas in the five remaining travel regions (Great North Woods, White Mountains, Lakes, Dartmouth-Lake Sunapee and Monadnock) produced 16.2 percent of total tourist spending in these five travel regions both at and away from the ski areas. The impact of tourist spending at New Hampshire's ski areas was highly concentrated during the skiing season, where it made up about 45.3 percent of all tourist spending in these five northern and western travel regions during the five month December 2012 to April 2013 period. The impact of the state's ski areas on the economies of these five travel regions was critical during this five month winter and spring period. This is the key reason that state and county governments were involved in establishing some of the state's first ski areas and why they continue to play an active promotional role for all ski areas today.