A recent study conducted by the University of Tennessee Center for Business and Economic Research (CBER) estimated the annual impact of UT Athletics to the state of Tennessee at approximately $151 million for the 2011-12 fiscal year.
The study also cites the job creation benefits of UT Athletics, estimating that more than 2,900 jobs are created annually as a result of combined annual spending by the department and fans attending UT football, men’s basketball, and women’s basketball games.
The purpose of this study was to examine the economic impact of UT Athletics on the state through the perspective of total spending by the department and the income, employment opportunities, and tax revenues generated by this spending.
“Our report provides some useful context for the tremendous impact that the University of Tennessee Athletics Department has on the state of Tennessee,” said CBER Director William Fox.
“Most fans can appreciate the benefits of having top-tier athletics programs in a broad sense, but this analysis allows us to quantify the significant economic impact in terms that people can understand: earnings, jobs, and tax revenue.
“The fact is that the University’s athletics programs generate an impact that is equivalent to a very large amount of earnings, jobs, and tax collections. More importantly, that impact seems to have held up quite well despite well-known and significant challenges in the broader economy and on the playing field.”
Before the report just released, the most recent study on this issue was in 2004 and estimated the annual economic impact of UT Athletics at $103.8 million, indicating an increase of $48 million over the last eight years.
The CBER economic impact calculation was reached by combining the direct spending by UT Athletics on payroll and fringe benefits ($37.35 million) with the indirect impact created by payroll and non-payroll spending by the department ($68.52 million) and the indirect impact of fan spending on the economy ($45.03 million).
A significant increase to the tax revenues for state and local government is also created each year by UT Athletics. The CBER report estimates that UT Athletics generates more than $28 million annually in state and local revenues each year. This total includes slightly more than $20 million in state and local sales taxes and $6.3 million in other tax revenues, including payroll taxes, gasoline taxes, and business taxes paid by companies from revenues derived from UT Athletics. The amusement tax on ticket sales for UT Athletics events at Neyland Stadium and Thompson-Boling Arena also generated $1.55 million in local revenues for fiscal year 2011-12.