No high jump for UK economy during Olympics

Credit rating agency Moody's reckons the Olympic games will not offer much more of a boost to Britain's economy.

by Michael Northcott
Last Updated: 19 Aug 2013

A report by Moody’s on the Olympics says that the positive impact of extra spending on infrastructure for the games has already been felt by the country’s GDP figures, and that we probably won’t be able to squeeze much more benefit out of the project. The government views the Olympics as a way of generating more cash and jobs, but it looks like we’ve already seen the bulk of the boost.

Moody’s does expect the overall impact of the Olympics on the economy to be positive, but this won’t be any consolation to George Osborne, who needs as many drivers for growth as he can get. If transport companies were hoping for a bump, they may be disappointed too. Moody’s says that a spike in tourist passenger numbers may actually displace other non-olympics travel, meaning no exciting jumps in revenue. Local hotels will see surging trade, but many local businesses will have to contend with employees taking long holidays or struggling to get to work on time. At least it will be an opportunity to take a bike to work…

Not everyone will be disappointed by the lack of impact post-games however: Moody’s suggests that corporate sponsors will do well out of their involvement. Coca-Cola and McDonald’s as well as Lloyds Banking Group, British Airways and BP all stand to benefit from the international exposure and from the long association with the International Olympic Committee, and London 2012.

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