Motorsports Industry in Carolina - Research Paper Example

Motorsports Industry in Carolina Racing as a participatory, as well as a spectator sport, is gaining popularity very fast in the world. For instance, attendance at NASCAR events has been above 90% since 1990 (Arthur, Connaughton, Gandar, Krapl & Madsen, 2004). Stock car racing auto-competes other sports other than football in TV ratings. As a result of this, it is apparent North Carolina gain a lot in terms of economic activity as a result of the rise in motorsports popularity. In relation to this, the North Carolina Motorsports Association (NCMA) that was formed in 2002 identified the opportunities in North Carolina that could support this industry (Arthur et al., 2004). In relation to this, NCMA together with senior state officials agreed on starting this sport in North Carolina after evaluating the economic impact of the industry. In relation to this, the paper aims at expounding on the economic and social impacts of the motorsports industry in North Carolina. The paper will also provide detailed information on the cultural issues related to motorsports as well as the science behind motorsport industry in North Carolina (Arthur et al., 2004). The Motorsports which is one of the sources of entertainment in the U.S has a 38-year history. The company was started by O. Bruton Smith in his attempt to develop one of the largest racetrack operations in the U.S. Smith started promoting races that were performed small dirt tracks in North Carolina in 1950s, the work that kept him busy as he was working on his project. In 1959, he came up with Charlotte Motor Speedway (CMS) project that was to cost $600,000 (Arthur et al., 2004). The lack of enough capital made him retreat from his project that he re-started again in 1970s. It is the success of the CMS in 1970s that led to the introduction of the North Carolina Speedway. In relation to this, Speedway Motorsports was formed in late December 1994 by Smith, the founder of the car race. Motorsports consist of a wide variety sports that include the racing of heavy-powered vehicles with the intention of competing against other drivers, as well as drivers (Arthur et al., 2004). Apart from boat racing, they also include truck racing and motorcycle racing. The increase in popularity of the motorsports competitions has contributed significantly to the rise of multi-billion dollar industries around the places where the sports are played. The economic contributions of motorsports The economic impacts that result from motorsports are very diverse. Apart from output impacts, these impacts also include employment impacts; value added impacts as well as employee compensation impacts. The output impacts The annual estimation of 2003 showed that total direct spending by motorsports industries in North Carolina was approximately 3.2 billion dollars. The largest of these direct expenditures was NASCAR Teams that constituted 1.26 billion dollars (Arthur et al., 2004). Apart from the direct output impacts, the motorsports industry in North Carolina had indirect output impacts that were above 1.0 billion dollars and the induced economic impacts that were 870 million (Arthur et al., 2004). In relation to this, the total economic impact of motorsports industry in North Carolina which constituted of the direct, indirect, and induced impacts added up to 5.0 billion dollars in 2003 (Arthur et al., 2004). In relation to the findings of 2003, Connaughton and Madsen (2006) found out that the direct spending by motorsports firms in 2005 was approximately 3.8 billion dollars. Of all the expenditure, NASCAR Teams was found to have the largest expenditure; 1.7 billion dollars. Apart from direct output impacts, 1.1 billion dollars and 964.9 Million were generated from indirect output impacts and induced economic impacts respectively. In relation to this, the total economic impact as a result of motorsports industry on the North Carolina was 5.9 billion dollars in 2005. When compared with the value of 2003, it is apparent the total economic impact of motorsports in North Carolina rose by 0.9 billion in 2005. This large economic impact is a direct indication of how crucial the motorsport industry is to the North Carolina’s economy. Employment impacts Apart from output impacts, motorsports industry also has employment impacts. The employment impacts of motorsports industry are very significant. The estimation that was made motorsports sector, as well as IMPLAN Industry Code, showed that NASCAR Teams had the largest employment opportunities; the NASCAR Teams had 4,559 jobs (Arthur et al., 2004). The Travel & Tourism sector as a result of motorsports industry directed 1,673 jobs whereas the Suppliers sector for motor vehicles had 1,490 direct jobs (Arthur et al., 2004). To sum up, the motorsports industry in North Carolina generated 24,406 jobs in 2003. In addition to 12,292 direct jobs, this employment impact also consisted of 5,698 indirect jobs as well as 5,506 induced jobs (Arthur et al., 2004). In relation to this, the regional employment estimates of 2003 showed that employment impacts of motorsports exceeded 400 jobs in 2003. In relation to this, Connaughton and Madsen (2006) also carried a study to determine the employment impact of motorsports industry to North Carolina. According to their result, NASCAR Teams provided the largest number of direct employment impact, 4,445 jobs. There were also 2,050 direct jobs in the in the Suppliers sector and 1.768 jobs in the Marketing sector. In total, the motorsports industry resulted in 27,252 jobs in 2005 for the North Carolina economy. From the figure of 2003, it is apparent the number of jobs increased by 2846. Compensation impacts The compensation impacts The estimates of compensation impacts of the motorsports industry in North Carolina are also appealing. Compensation constitute of not only wage benefits, but also now-wage benefits to the jobs created by the industry. According to the statistics of 2003, 1.5 billion dollars was generated from direct, indirect, as well as induced economic activity as employee compensation (Arthur et al., 2004). From the statistics of 2003, it is apparent that the average compensation per employee through direct motorsports jobs was $70,548 annually. The statistics table provided by (Arthur et al., 2004, p.15) also shows that “the total average compensation per employee for the state for all 24,406 direct, indirect, and induced jobs was $61,017 per year.” From all these, one can deduce the average annual wage of the jobs generated by the motorsports in North Carolina was $45,763 in 2003 (Arthur et al., 2004). The study of Connaughton and Madsen (2006), in motorsports industry in 2005 showed that the compensation of employment as a result of direct, indirect, as well as induced economic activity, was 1.7 billion dollars. The employment compensation of 2005 was higher than that of 2003 by 0.2 billion. This variation in the figure is a clear indication of how motorsports industry is becoming more effective in North Carolina with time. Value added impacts The value added impacts provide information about the value of North Carolina inputs in the final selling of goods and services. These values can be defined as the impact of the motorsports industry on the North Carolina’s Gross State Product (GSP). According to Arthur and his colleagues (2004), the NASCAR Teams sector produces the largest value added. It generated 400 million dollars in 2003. In addition to this, the NASCAR Teams sector activity generated 253 million dollars, indirect value added, and 187 million dollars, induced value added impact (Arthur et al., 2004). To sum up, the direct value added impact by motorsports industry was 1.4 billion dollars in 2003. In summary, the economic impacts of the motorsports industry were very significant in North Carolina economy in 2003. It not only increased the output by approximately 3.2 billion dollars, but also increased employment opportunities by 12,292 jobs. The motorsports industry also increased employee compensation; it increased by 913 million dollars. The value added was also increased by the industry by 1.4 billion dollars in the same year. This value, however, is slightly lower than the one that was found in 2005. According to Connaughton and Madsen (2006), the value added the impact of the motorsports industry was 1.5 billion dollars. Socio-cultural impacts of motorsports Socio-cultural impacts often divert attention to the perception of residents as well as the community hosting a sporting event. The impacts of motorsports on the citizens of a given area have been determined by many researchers from the past. For instance, Baker (2013) in his study found out that individuals who support the sporting event in their residential area tend to acquaint themselves with the theme of the event, attend the event and are young in age. On the other hand, those who have a negative perception of the event avoid attending the event, are older and have low identification with the theme of the event. According to their research, individuals who got the employment from the event also portrayed positivism to the event. In tandem with all these findings, it is apparent that motorsports have significant socio-cultural impacts in North Carolina. This is evidenced by the fact that the contributions of sporting events to the society tend to be almost the same. It is apparent that the event unites people who attend. Increase of local pride as well as community spirit Previous studies have shown that hosting of mega sporting events increases civic pride, community participation, as well as the morale of the local community (Baker, 2013). In relation to this, Baker (2013) found that more than 75 percent of the residents of Canberra approved as well as supported the Australian V8 Supercars touring car race in the following year with the claim that the event increased their community pride by making the area more attractive. A similar survey that was carried in Singapore found that more than a half of the residents of Singapore agreed that the hosting of Formula One event increased their civic pride (Baker, 2013). A research on the World Rally Championship in Australia also showed that over 90 percent of the Kyogele residents believed that the image of their city was altered positively by the event. In support of this, many residents claimed that the global audience increased awareness that put Kyogele on not only the map, but also the world phase of motorsports competition. Baker (2013) also claimed that the hosting of a rally car event that took place between Republic of Ireland and Northern Ireland border enhanced social cohesion in addition to bringing people from the two jurisdictions together. In tandem with all these findings, it is evident that the motorsports events in North Carolina increases not only the local pride of the residents, but boost the community spirit. Negative social effects of motorsports Although motorsports events have many advantages, it is apparent that they also have negative impacts on the community residing near the place of the event (Baker, 2013). For instance, an Australian study showed that noise and traffic are the main negative impacts of the motorsports events. In relation to this assertion, it is also apparent that the events also result in conflicts or division of people. Another negative effect of the motorsports events is the “hoon effect” (Baker, 2013). Hoon effect is a term used in Australia to refer to a reckless, speeding driver of the passenger vehicle. The speed at which race cars are driven influences other drivers into driving very fast leading to the occurrence of accidents (Baker, 2013). Apart from congestion, increase in crime as a result of hosting the event often make local residents leave their region to avoid the social disruption that result from the event. It is also apparent that the failure of the event to occur as planned as a result of severe weather may affect the sporting event completely. For instance, the failure of the F1 race that was hosted by the Indianapolis Motor Speedway led to the drop in event attendance as well as the complete cancelation of the IMS from the F1 World Championship (Baker, 2013). The noise by the motorsports events also affects the residents of North Carolina. They also contribute to the increase of crimes. The road accidents in Carolina are also as a result of reckless driving by drivers of passenger cars. This is evidenced by the fact that the majority of the drivers who cause accident try to emulate what they see in the motorsports events. The science behind motorsports Little has been tabulated about the science associated with what racecar drivers experience in their profession. This is in relation to the fact that sports are often associated with fitness. Participation in sports is often linked to training so as to improve the fitness of the athletes (Mendel & Potkanowicz, 2013). In tandem with this assertion, it is evident that driver’s fitness is one of the elements that are observed before one involves in the motorsport competition. In observing this, a lot of concentration is directed to the stress the driver experiences through participating in the sport. The interactive event of the driver’s heart rate and the body temperature are also observed effectively in order to determine its effects (Mendel & Potkanowicz, 2013). Some of other things that play a part in the racecar competition are the physical fitness of the driver’s feet, legs as well as hips. Like many other sports, racecar competition is also associated with the consumption of oxygen (Mendel & Potkanowicz, 2013). As the intensity of the exercise increases, the heart rate of the driver also increases to meet the demands of the exercise. The activity carried out by the driver in the racecar sport is more involving than the majority of other sports. Apart from involving the mind, the driver uses a lot of energy in turning the steering wheel left and right (Mendel & Potkanowicz, 2013). Besides the steering wheel, the driver also operates the pedals of the car. In addition to this, the driver uses a lot of energies to maintain himself or herself in the cockpit. He or she must also ensure the head, as well as the clad in a helmet together with head-helmet weight, are kept in proper driving position (Mendel & Potkanowicz, 2013). In conclusion, motorsports industry contributes significantly to the economy of North Carolina. Apart from contributing to the states GDP, it also creates employment opportunity for many people in North Carolina. The contribution of the motorsports industry in North Carolina increases each year. This is evidenced by not only increase in the state’s GDP, but also employment opportunities. In addition to this, motorsports industry in North Carolina plays a part in the attraction of tourists. Racecar competition also has diverse socio-cultural impacts to the North Carolina. It enhances social cohesion in addition to increasing local pride and community spirit. Apart from these, motorsport competitions have diverse negative impacts. They are the main contributor of reckless driving by a majority of the drivers who cause accidents in North Carolina. Motorsports competition also affects the calmness of a given area. Apart from increasing the rate of crimes, they also produce a lot of noises that drives residents from their homes. References Arthur, J., Gandar, J., Krapl, A. & Madsen, R. (2004). The Economic Impacts of the Motorsports Industry On the North Carolina Economy. Retrieved from http://www.nccommerce.com/Portals/8/Documents/Research/EconomicImpactsoftheMot orsportsIndustryonNCeconomy2004.pdf Baker, A. (2013). Automobile Races and the Marketing of Places: A Geographic and Marketing Exploration of IndyCar Racing in the United States. Retrieved from http://trace.tennessee.edu/cgi/viewcontent.cgi?article=3178&context=utk_graddiss Connaughton, J. & Madsen, R. (2006). The Economic Impacts and Occupational Analysis of the North Carolina Motorsports Industry for 2005. Retrieved from http://charlotteusa.com/images/uploads/CharlotteUSA_Motorsports_Report_2006.pdf Mendel, R. & Potkanowicz, E. (2013). The Case Driver Science in Motorsport: A Review and Recommendations. Springer International Publishing Switzerland. Retrieved from http://www2.onu.edu/~e- potkanowicz/Potkanowicz/My_Research_files/The%20Case%20for%20Driver%20Scien ce.pdf Read More