Despite a lagging U.S. economy, Broadway was responsible for bolstering New York City’s finances by $9.8 billion for the 2008-09 season, the most recent...

Despite a lagging U.S. economy, Broadway was responsible for bolstering New York City’s finances by $9.8 billion for the 2008-09 season, the most recent season for which there are numbers, according to a new report by theater industry trade association, the Broadway League.

In the biennial report entitled “Broadway’s Economic Contribution to New York City 2008-2009,” the total economic impact is broken down into three categories: producers’ spending related to their shows, spending on venue maintenance by theater owners, and ancillary spending by theatergoers living outside of NYC who responded in questionnaires that Broadway was an important part of their trip to the city.

In past reports, the League has included only the spending of respondents claiming that Broadway was the primary goal of their trip. This change in methodology was intended to include expenditure by those travelling from a long distance who may not describe attendance at a Broadway show as the primary goal of their New York City trip. Unfortunately, this change prevents historical comparisons to the impact of theatergoers’ spending over previous seasons.

The League’s researchers determined Broadway’s full economic impact last season by adding the direct spending of the three major groups to the total of subsequent spending of these same funds throughout the New York City area and beyond (The League participates in a national research group where they can get hard numbers for these subsequent rounds of spending). For instance, a producer will pay an actor’s salary, and in turn the actor will spend that salary for food, clothes, housing, etc., supporting the city’s economy. In addition, part of that money will pay the actor’s state and federal taxes, supporting the larger economies.

For the 2008-09 season, direct spending from Broadway shows was $949 million, with a total financial impact of $2 billion. Theater owners contributed $34 million, with a total impact of $51 million. Non-NYC tourist spending topped $5 billion, and the full impact of this spending came to $7.7 billion.

Charlotte St. Martin, the Broadway League’s Executive Director, spoke with TicketNews about the report’s changed methodology and trends in the industry’s economic impact in the absence of hard numbers for historical comparison.

“I would say that the reason we changed the methodology is the large and growing number of tourists and international visitors. [This] would also imply that the economic impact is growing, because the international traveler buys more tickets than all other tourists because they’re here longer,” St. Martin said. “Previous research has always reflected that the longer stay visitor, which is primarily the international visitor, does buy more tickets.”

The number of international visitors to Broadway continued the marked growth it began in the middle of the last decade. Non-U.S. visitors for the 2008-09 season totaled nearly 2.5 million, up from 1.9 million for the 2006-07 season and nearly double that of the 1.3 million who attended shows in the 2004-05 season.

Non-New York City business was significant in the total economic impact for the 2008-09 season, with 82.2 percent of all Broadway tickets purchased by those living outside of New York City. The League reports that $9.38 billion, or 96 percent of the Broadway’s full economic impact on the city, originated from sources outside of the city.

As to the future of star-driven Broadway shows versus smaller, lower-budget productions, St. Martin says, “We don’t know that until we get very close, but I think one of the major changes to Broadway in the last 20 years is we have a number of not-for-profit theatres on Broadway, like the Roundabout, the Manhattan Theater Club, and Lincoln Center. By nature, what that does is it assures more of the limited run shows which enable the stars to play Broadway. Looking forward, there are a number of new and revival musicals of varying sizes, which I think is one of the reasons the health of Broadway is so strong. We are producing something for everybody.”