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Close Look: May 2024

one month ago

Swiftonomics: what’s the big story?

Demand for tickets to attend Taylor Swift’s global concert tour, known as the Eras Tour, has hit unprecedented heights. The frenzy is such that the impact on local and even national economies can be significant. So much so, that the US Federal Reserve (Fed) made mention of the Philadelphia concerts in its Beige Book for June last year. This spending boost has become known as ‘Swiftonomics’. We take a closer look at how a phenomenal pop singer turned into an economic phenomenon.

The economic uplift, as the concert tour proceeds around the world, is not simply a matter of ticket sales. For fans, known as Swifties, the experience will require further spending on lodging and food, as well as clothes and merchandise. It is estimated that the total spend per individual can exceed $1,300. As the Fed noted last year, the concerts contributed to Philadelphia’s strongest month for hotel revenues since the pandemic. Indeed, the economic boost felt by a city hosting these concerts was on a par with hosting a Super Bowl.

Estimates for the Eras tour suggested a total boost to the US economy of $5 billion from spending by ‘The Lucky Ones’ who bought tickets. This could rise to $10 billion, once the spending of the Swifties who cannot attend the concerts but join other events around the time, is factored in. While $5 billion or even $10 billion is not going to move the dial on an economy the size of the US, the effect can be significant elsewhere. Small wonder that countries such as Canada have requested a visit from the pop diva, a request which was granted.

Taylor Swift is not the only pop megastar to have unleashed huge amounts of consumer spending. Beyoncé’s Renaissance Tour was the 2023 record breaker, grossing an estimated $580 million, while Bruce Springsteen, Coldplay and Harry Styles were also high on the list.  But the Eras Tour has broken all previous records grossing more than $1 billion so far. And the tour continues. Meanwhile, Taylor Swift’s net worth is now thought to exceed $1 billion.

The broader economic implications of such one off levels of consumer spending are clear. After the economic shocks of the past few years, such as the pandemic and soaring inflation, many consumers became more cautious and reluctant to spend their money. Savings rates remain high across much of Europe, for example, although the US consumer’s renewed enthusiasm for spending has brought savings ratios down to pre pandemic levels. Unwittingly, Swifties around the world have played their part, providing a welcome uplift to their domestic economies, while worshipping at the feet of their idol.

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