The price of tickets for sporting events soared by an astounding 25% in October compared to the same period last year — a consequence of the surging rate of what economists call “funflation.”
Federal data released by the Department of Labor highlighted the booming demand for live, in-person entertainment and experiences such as concerts, dining out in restaurants, and sporting events.
The rate of inflation for sports tickets far outstripped that of groceries (2.1%), electricity (2.4%), cigarettes (7.6%), and rent (7.2%), according to the Bureau of Labor Statistics.
The Consumer Price Index, which gauges the rate of inflation for hundreds of items, rose 3.2% in October — a slight cooling from the inflationary trend that has hamstrung shoppers since the end of the coronavirus pandemic.
The latest inflation figures have given investors hope that the Federal Reserve will pause its hikes of interest rates.
However, cooling inflation hasn’t helped sports fans looking to catch their favorite team.
Analysts said that professional sports leagues slashed ticket prices in 2022 in hopes of luring fans back to arenas and stadiums after a lengthy period during which they were largely confined to their homes in the COVID period.
That would explain the surge in ticket prices this year as Americans settle into a pre-pandemic normalcy.
Economists coined the term “funflation” to describe the phenomenon whereby consumers splurge on discretionary items at a time when prices for necessities such as gas, food, a new car, and rent continue to climb.
“We’ve seen this through the entire leisure and hospitality sector,” Victor Matheson, a professor and sports economist at the College of the Holy Cross, told CNBC.
“People are getting back to things that they enjoy doing and are willing to pay a bunch.”
Another reason for the spike has been the adoption of dynamic pricing by ticket-selling platforms. Instead of fixed pricing, the sites use a variable scale in which price points are determined based on the demand for the event at that particular time.
Sales of tickets to National Football League and the National Hockey League games doubled this year compared to 2022, according to secondary ticket marketplace StubHub.
National Basketball Association ticket sales rose some 60% at the start of the season compared to last year while college football ticket sales increased 50% this year.
It isn’t just sporting events that are fetching eye-popping sums for tickets.
Pop stars like Taylor Swift and Beyoncé are being credited with generating billions of dollars for local businesses during their respective concert tours.
Swift’s Eras Tour, which is currently on its international leg, is believed to be the most lucrative in US history — generating $5 billion in consumer spending.
Swifties are paying through the nose to see the “Shake It Off” crooner — with average ticket prices clocking in at $456.
Swift herself stands to earn an estimated $4.1 billion from the tour alone.
The six shows that Swift performed in Los Angeles generated some $320 million for the county while her Denver concerts brought in $140 million to Colorado’s coffers, according to data reviewed by The Washington Post.
Beyoncé’s just-completed Renaissance tour is estimated to have generated $4.5 billion in the US, according to The New York Times.
The pop star was blamed for single-handedly fueling higher levels of inflation in Sweden, where fans from around the world flocked to see her show — driving up the prices of food at restaurants as well as hotel rooms.
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