GHFA, IHRSA and Deloitte have published the report ‘Economic Health and Social Well-Being: Quantifying the Impact of the Global Health and Fitness Sector’
The authors calculate the monetary value of the health and fitness industry for GDP and healthcare.
Shows how turning inactive people into active people is key to lowering health care costs and increasing GDP
It was made public at the IHRSA 2022 event and analyzes the impact of the industry in 46 countries and territories, finding a total impact of US$91.2bn
The Global Health & Fitness Alliance (GHFA), in collaboration with IHRSA, has released a new report from Deloitte, outlining the social and economic value of the global health and fitness industry.
The 418 page document – Economic health and social well-being: quantifying the impact of the global health and fitness sector – describes the impact of the health and fitness industry on GDP and healthcare systems worldwide, as well as specific activity in 46 different countries and territories. It has identified a total impact of up to US$91.2bn per year*.
The premise of the report is that the industry is a major contributor to GDP and employment globally and that its presence, through gyms, clubs and physical facilities, raises activity levels in the local community, thereby increasing GDP. and reduces health care costs.
By reviewing existing data, academic studies, and industry reports, the authors have devised a way to indicate the industry’s impact by, first, explaining the economic impact of absenteeism and presenteeism, and second, citing how much costs one idle worker in each country or territory. it costs the economy.
This figure is key, because the report makes tangible recommendations, suggesting that investing a similar amount to help inactive people adhere to exercise habits would generate benefits for GDP and the health system, resulting in a recovery of the economy after just one year.
By evaluating data and economic studies, the report shows how active citizens create value-added GDP, reducing health care costs and reducing absenteeism and presenteeism.
The studies reviewed come from organizations such as the World Bank, the OECD and the World Health Organization (WHO), while the researchers also studied academic articles, such as RAND (2019), which found that inactive people lose between 2 .6 and 3.71 days of working time due to presenteeism and Lancet-published a report that found downtime cost health systems US$53.8bn worldwide, since 2013.
“This report begins to paint a picture of the industry’s impact on population health and the industry’s economic impact,” reads the GHFA and IHRSA foreword. “Not only does the industry employ millions of people around the world and generate billions in value added to GDP, it also has an incredibly positive influence on health outcomes. By doing so, the industry collectively saves billions in health care costs and productivity benefits.”
The design of the report for each country or territory begins with its status in figures related to GDP per capita, health spending as a percentage of GDP, disposable income per capita, aging trends, percentage of insufficient activity and level of obesity. They follow health trends and government initiatives, then the economic impact.
For the UK, for example, the health and fitness industry in 2021 had direct value added of US$3 billion and supported an additional US$1.5 billion in value added in its supply chain, as well as 50,100 jobs. Deloitte then reveals the economic benefit for each inactive worker who becomes active.
Exercise leads to better health benefits, such as a reduced risk of heart disease, stroke, hypertension, type 2 diabetes, dementia, depression, anxiety, and a variety of cancers, including breast, colon, bladder, kidney, lung and stomach. By linking the impact of activity to GDP and health care costs, Deloitte demonstrates how adoption of exercise can remove a burden from the health care system, as well as increase GDP.
Inactivity costs the UK health system $4.3 billion a year according to the report, of which $3.6 billion is covered by the public health system. Every year the UK loses 43.8 million working days to absenteeism and presenteeism, costing the UK economy $16.5 billion a year.
It concludes that each inactive worker costs the economy US$1,713 per year and that investing US$1,700 in helping an inactive person become active pays for itself in less than a year.
In the US, inactivity costs the health system $84.7 billion, each inactive worker costs the economy $3,447 per year, and an investment of $3,000 is suggested to transform inactive people into regular athletes .
In Spain, inactivity costs the health system 7,200 million dollars, 19.8 million working days are lost due to absenteeism and presenteeism, and each inactive worker costs the economy 1,978 dollars (2,000 dollars of investment is recommended per inactive person).
In China, inactivity costs the health system US$15.3bn, while the nation loses 381.5 million working days to absenteeism and presenteeism and each inactive worker costs the economy US$466 (with a recommended investment of US$400). per person).
“The good news is that, if implemented correctly, programs to increase exercise can be habit forming (Kaushal and Rhodes, 2015),” the report reads. “An initial investment in a year can pay off for years if you make a habit of it.”
The report’s authors, Alan McCharles, a partner at Deloitte China, Adrian Xu, a director at Deloitte China, and Nicholas Young, a senior associate at Deloitte China, also conducted interviews with industry stakeholders to shed light on some of the issues with the government. and industry today. perceptions, collaboration and integration. He also highlighted how China, the United States and Japan are working together.
One of the problems raised is that governments view gym membership as a recreational activity rather than an investment in health. In the UK, gym membership carries a 20 per cent VAT, while in Belgium the use of sports facilities is taxed at just 6 per cent.
Stakeholders suggested that purchases like this should have a more favorable tax rate.
Personal training programmes, physical activity policies and exercise as preventative care are suggested as ways governments could work with the health and fitness industry to drive the transformation of inactive people.
The most established fitness markets, as measured by penetration rates among adults, are Sweden (34%), US (30%), UK (23%), Australia (23%) and Germany (22%). ).
Fast-growing markets include Hong Kong (8%), Singapore (7%), Japan (6%) and China (6%).
The underdeveloped markets are Malaysia (1.5%), Thailand (0.7%), Vietnam (0.7%) and India (0.2%).
According to GHFA and IHRSA, the 46 countries and territories chosen for inclusion in the study account for about 90 percent of global GDP. They are Argentina, Australia, Austria, Belgium, Brazil, Bulgaria, Canada, Chile, China (PRC), Chinese Taipei, Colombia, Costa Rica, Cyprus, Czech Republic, Denmark, Finland, France, Germany, Greece, Hong Kong SAR – China, Hungary, India, Indonesia, Ireland, Italy, Japan, Malaysia, Mexico, Netherlands, New Zealand, Norway, Peru, Philippines, Poland, Portugal, Russia, Singapore, South Africa, South Korea, Spain, Sweden, Switzerland, Thailand, United Kingdom, United States and Vietnam.
To access the report, go to www.ihrsa.org.
*Some double counting has been identified in this number.