The outdoor recreation economy is often touted as a massive contributor to the GDP, but the reality is more complex than it seems.
Every year, a series of infographics and press releases tout the massive economic impact of the Outdoor Recreation economy. By all measures, it's massive – the BEA attributed $862 billion of as the gross economic output of the outdoor recreation economy for 2021. But what does that really mean?
Before we continue, I want you to think about the trends, spends, and activities that you think are the greatest contributing factors to that that $$$ impact.
The Bureau of Economic Analysis uses the North American Industry Classification System (NAICS) to define industries and sub-industries. However, “outdoor recreation” is not one of these industries, it's a special satellite account that aggregates related economic activity. The GDP of outdoor recreation is not an independent industry, but is instead made up of slivers of the GDP other industries. The methodology is further documented here.
What does this mean? Well, it is 100% accurate to say that the outdoor recreation economy is *big*. However, it's probably not the most accurate to compare that output directly with other industries, since a portion of the outdoor recreation GDP is actually made up of the GDP from those other industries. For example, the outdoor recreation GDP contains $13B from farming and $763M from mining that is somehow related to outdoor rec.
Let's say I have 20 industries. Each of those happens to have $5 worth of GDP. If I take $1 of each that constitutes the "Outdoor Recreation", I now have $20...which is obviously “more” GDP than Industry A ($5). It's accurate to say I have a big impact, but might be confusing to compare directly with Industry A and say "Hey look, $20 > $5".
1. Outdoor recreation has a very *big* impact
2. It's somewhat misleading to compare that impact to single industries
3. Yes, I'm being pedantic, but over-analyzing is kinda my thing.
The breakdown of the numbers by industry, sector, state and more are all available in the report, so I wanted to share a few things I found interesting.
I think this might highlight a disconnect in how most people think about the “outdoors” and what the breadth of the “Outdoor Recreation Economy” actually is. Those powerboats on Lake Powell that “everyone” hates? Recreation economy. Those loud and annoying motorcycles and ATVs in Moab? Recreation economy. Boomers in RVs crowding your national parks? Recreation economy. Horses? Recreation economy. Waterparks, golf, paintball, gardening, skateboarding? All recreation economy.
The Climbing/Hiking/Tent Camping category, which I suspect many people would consider to be the “core” outdoors market had $5B of value added, with the *combined* impact of those activities coming in just below snow. If you actually take a minute to think about it — this all makes sense. Boats, RVs, and ATVs are expensive and have a long chain of associated economic activity (manufacturing, repairs, gas, rentals, etc). RVers are likely to be traveling for longer periods of time, and spending more money on campgrounds or local travel activities/food. Hunters and fishermen spend a ton of money on permits and travel. Skiing is expensive and drives a ton of tourism. Occasionally paying for a $350 tent that will last a decade or a $20 backcountry permit doesn’t really compare. Plus, you’re probably car-camping for free on BLM land anyways. Heck, for trail running my biggest expenditures are a pair of $170 shoes 3-ish times a year and fees for one or two races.
As I mentioned above, the Outdoor Recreation Economy is made up of economic output from a ton of different places. I highlighted a few interesting ones above. It’s an interesting experience to look at the full list and think about how spread out this impact is. Some things seem obvious, like Retail Trade making up 26% of the overall dollar value added, or Accommodation counting for $35B (as expected, big increase from 2020). But It also includes things like $31B of impact from Transportation and warehousing — which I believe is focused on transporting Outdoor Recreation-related goods around the country. Petroleum and Coal products is likely so high because petroleum-based synthetic materials are in nearly *everything.
I don’t have a sprawling thesis here, but it’s always good to take a moment to *really* think about something like this. The long-tail of the recreation economy is massive, and includes both obvious and surprising things. It’s spread across a myriad of industries and activities. It’s not just you and I buying outdoor gear and camping on the weekend. It’s the truck that got that gear to REI (or your front door), the companies that manufactured that gear, the companies who sold that manufacturing equipment, and the suppliers that provided the raw materials. It’s the ski shop, the skis, the EPIC/IKON pass, the flight, the Airbnb, the lessons, the expensive on-resort food, the ambulance bill, and the sports rehab. It’s more than hiking trails — it’s people “recreating” outside, for any reason from gardening to kite flying or birdwatching.
Like most things, it’s big, complicated, and fun to think about. I’ve added the whole breakdown below — this is the Real Outdoor Recreation Value Added by Industry vs Gross, but the ratios are about the same.
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