Impact of 2012 Olympics on the Uk Economy
Impact of 2012 Olympics on the UK Economy
Introduction
Until 16th July 2012, there are only 11 days left for the Olympics games held in London, on 27th July 2012. Beside the games, people also focus on how this momentous event will affect the UK’s economy as UK’s economy is currently suffering from the recession. Will the games attract world attention as well as huge economical benefits to UK? The objective of this essay is to investigate the economic impact of the London 2012 Olympics on the UK economy in short-term and long-term. Due to the limitation of information, the essay will concentrate on aspects of the economic impact where most data are available such as the GDP growth and consumer spending. The impact across some key sectors such as construction, labour market and tourism will also be analysed. To be evaluated in detail, the impacts on companies in different sectors will be addressed through an analysis of stock market announcements in 2012.
Background
The budget for the London 2012 Olympics is continuously increasing since Britain won the bid in July 2005. The original predicted cost was £2.37 billion; by the time in 2008 it was raised to £9.35 billion, and with £6 billion is coming directly from the government. As UK is under an increasing pressure of the downturn in the economy, this level of public funding has been criticised by the press. However on the other side, as Ms Jowell, the minister for the Olympics and Paymaster General claimed, the Government 's spending could be seen to stimulate the economy and generate jobs for local people. (The telegraph, 12 November 2008)
The total economic impact of the Games on the UK
The Gross Domestic Product (GDP) is the most important measure of economic activity in a country. Several forecasts on the UK GDP growth due to the 2012 Olympic Games have been made by various organisations. The official forecast from the Office of Budget Responsibility is that the UK economy will grow by 0.7% in
Introduction
Until 16th July 2012, there are only 11 days left for the Olympics games held in London, on 27th July 2012. Beside the games, people also focus on how this momentous event will affect the UK’s economy as UK’s economy is currently suffering from the recession. Will the games attract world attention as well as huge economical benefits to UK? The objective of this essay is to investigate the economic impact of the London 2012 Olympics on the UK economy in short-term and long-term. Due to the limitation of information, the essay will concentrate on aspects of the economic impact where most data are available such as the GDP growth and consumer spending. The impact across some key sectors such as construction, labour market and tourism will also be analysed. To be evaluated in detail, the impacts on companies in different sectors will be addressed through an analysis of stock market announcements in 2012.
Background
The budget for the London 2012 Olympics is continuously increasing since Britain won the bid in July 2005. The original predicted cost was £2.37 billion; by the time in 2008 it was raised to £9.35 billion, and with £6 billion is coming directly from the government. As UK is under an increasing pressure of the downturn in the economy, this level of public funding has been criticised by the press. However on the other side, as Ms Jowell, the minister for the Olympics and Paymaster General claimed, the Government 's spending could be seen to stimulate the economy and generate jobs for local people. (The telegraph, 12 November 2008)
The total economic impact of the Games on the UK
The Gross Domestic Product (GDP) is the most important measure of economic activity in a country. Several forecasts on the UK GDP growth due to the 2012 Olympic Games have been made by various organisations. The official forecast from the Office of Budget Responsibility is that the UK economy will grow by 0.7% in
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