LOCAL ECONOMY, 2000,

The Midweek Matc h: P remiership Football and the Urban Ec onomy

VOL.

15,

NO .

3, 198 213

" FEATURES
The Midweek Match: Premiership Football and the Urban Economy
Sam Johnstone, Alan Southern and Rogan Taylor
& ABSTR ACT The n an cial aspect of Prem iership football is cu rren tly attractin g hu ge atten tion . Hardly a week goes by withou t som e n ew story breakin g abou t the gam e, whether it is a record tran sfer, a wage or television deal, or the bu ildin g of a n ew stadiu m . Yet there has been little, if an y, investigation into ju st how the n ewfou n d wealth from Prem iership football impacts on the locality. In this article, the au thors presen t an initial indication of how the two Prem iership clu bs situ ated in Merseyside are lin ked in to the local econ om y. It is based on a su rvey of clu b su ppliers an d local bu sin esses located arou n d the two grou n ds of Everton an d Liverpool Football Clu bs. It shows Prem iership football to be m ore than a depen den t con su m er service activity in the local econ om y with a poten tial for exploitation in term s of su pplier n etworks, tou rism an d image boostin g. The au thors argu e that this is a su bject area that requ ires further research an d u n derstan din g, an d m ore seriou s atten tion as a featu re of local econ om ic policy. & INTR ODUC TION During the 1990s, professional football in the UK has been radically transformed. The formation of the Premier League occurred at almost the same time as professional football clubs were compelled to redevelop their ground s into all-seated stadia following the Taylor Report into the Hillsborough disaster of 1989 (Taylor, 1990). After nearly a decade of restructuring in the professional game, there is recognition that football, once an urban ritual with little pro t making aspirations, is now big business. In the 1997/ 98 football season, the Premier League had an operating pro t of over 100 million, the rst time such a

Sam Johns tone and R ogan Taylor are at the

Football Research Unit, University of Liverpool, tel: 0151 794 2401, e-mail: samj@liv.ac.uk. Alan Southern is at Durham University Business School.

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gure had been reached, and no club showed a pre-tax loss (Boon, 1999). Despite this, little effort has been spent on assessing the local economic effect of Premiership football in the local economy. This article, a case study on the impact of Everton and Liverpool football clubs on the Merseyside economy, is an attempt to address such a gap. The rst section of this article considers the relevance of professional football to the local economy. It argues that professional football can potentially prevent leakages from the local economy through trading links with local rms, while at the same time, can encourage visitors and act as a symbol for place. This section also shows the nancial growth of Premiership clubs and points out the irony of how this is often situated in close proximity to urban deprivation. The second part of this article looks speci cally at the role of Everton and Liverpool in the Merseyside economy. In the season 199798, the two clubs concerned recorded a joint turnover of over 55 million and employed some 342 full-time staff, with an extra 1,420 part-time staff brough t in on match days. The evidence presented here is based on an examination of companies who trade with the two clubs and on businesses located near to the two football stadia. The third section discusses the effects of Premiership football on an urban economy, showing how, in Merseyside, for every 1 spent by the two clubs combined, at least 34 pence stays within the local economy. In addition, over 1,700 full-time equivalent jobs in the supplier base are dependent on trade with one or both of the clubs. Finally, a number of points are raised concerning the need for further research and policy development to help conclude our argument that Premiership football is an area of economic growth that should be seriously considered as an item for local economic development. & SPORT AND THE LOC AL ITY Much of the work on sport and economic development has rested on new stadia build and has a distinct US focus (see Baade, 1996; Chapin, 1996; Pelissereo et al, 1991). In research of this kind, sport is often regarded as a tool for development led by a local governance regime or growth machine charged with urban regeneration (Keating, 1997). Only recently have researchers in the UK begun to consider the role of sport in local economic development (see Hardy et al, 1996). To some extent there is a growing consideration that sport is an area that offers local planners and policy-makers new opportunities for economic development. As Williams notes
although the sports sector is often criticized as being too small to rejuvenate local economies, it is as large as many of the more conventional manufacturing industries focused on in local economic policy and contributes to local regeneration not only in terms of its direct and indirect impacts but also through its intangible impacts such as on image enhancement and civic pride. (Williams, 1997, 75)

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Numerou s example s exist of the redevelopment of football stadia post-Taylor. The building of new stadia is also common , with examples at Sunderland, Middlesborough and Bolton being among the best. Sunderlands previous home , Roker Park, was situated in an area similar to that under discussion . The dif culties apparent in traf c congestion , expansion and redevelopme nt in a traditional working class residential district forced Sunderland to relocate to a developmen t in a riverside area. A survey of the residents and businesse s in the Roker area conclude d that the relocation of the stadium would only bene t the local community (Taylor, 1993). Liverpoo l and Everton also encounter the problems faced by Sunderland, with Everton also looking at plans for relocation.

Recent studies in the UK include those by Foley (1991) on Shef eld and the world student games, Ward (1996) and his study of Manchester and the failed efforts of the city to capture the Olymp ic Games and, more generally, Williams (1997) in his consideration of sport as part of consumer service growth. Each author demonstrates how local agencies see sport as an area with national, European and global appeal and which can dovetail into other current regeneration initiatives. Yet, despite the prestigious nature of projects such as the Manchester and Shef eld examples, and the amount of football clubs involved in upgrading and rebuilding football stadia,1 there appears to be little or no work in the UK that has thought about the effects of Premiership football on the locality.
P rofessional football and the local economy

Most of the focus on professional football has been based on the game in England turning into a global commodity. Soccer investment includes club oatation on the London Stock Exchange or the Alternative Investment Market, growth in the consumption of club merchandise (particularly replica kits) and the emergence of corporate hospitality at the grounds themselves. This leads those such as Conn (1997) to reminisce about how football has changed, from a game grounded in its locality and belonging to its people, to an international business. However, as the results from our work begin to indicate, football clubs have an important contribution to make in a local economy. They can add to the value chain of a range of mixed producer and consumer services and they can help to prevent leakages from the locality. Not only is there a local economy around football clubs, but they encourage visitors into the locality and, because of their symbolic value as a part of local culture and community, they can support the boosterist image-making of a place. The annual review of football club nances show a rapid nancial growth rate for football clubs across England (Boon, 1999). During the season 199798 income rose over all four English professional divisions by 23 per cent to 829 million. The Premier League is particularly well placed to exploit such growth, with clubs in this league recording a combined operating pro t of 100 million. In contrast, the remaining 72 professional clubs in England reported a combined loss of 52 million. This polarisation, of nancial haves and have-nots, is more distinct than ever before in football. The ve biggest Premier League clubs now show a combined income greater than that of the entire 72-club Football League, although some have argued that this is not problematic (see Dobson and Goddard, 1998). As more and more supp orters are be ing attracted to football, it is conceivable to suggest that the combined income for all professional clubs will soon be above 1 billion. This will make football by far the most pro table sporting business in the UK, and equates the industry as a whole with many other sectors of commerce (Boon, 1999).

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Table 1. 1998
Club

The worlds ric hest clubs and loc al deprivation s c ores (E ngland)
Revenue (m) World ranking Locality 1998 deprivation Rank (n 354) 1 5 9 10 13 17 18 20 Manchester Newcastle upon Tyne Kensington and Chelsea Liverpool Islington Birmingham Haringey Leeds 3 19 63 1 10 5 13 56 local

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1997

1998

Score

Manchester Utd Newcastle Utd Chelsea Liverpool Arsenal Aston Villa Tottenham Hotspur Leeds Utd

87.9 41.1 23.7 39.2 27.2 22.1 27.9 21.8

87.9 49.2 47.5 45.5 40.4 31.8 31.2 28.3

36.33 27.95 18.54 40.07 32.21 34.67 31.53 19.06

(Source: clu b reven u e gu res accordin g to Deloitte an d Tou che, 1999; locality deprivation gures from the Department of Environment, Transport and Regions, 1998)2

Against this background comes the recent proclamation that the worlds richest club, Manchester United, resides in an urban centre in the north-west of England. Of the 20 clubs ranked the worlds wealthiest according to turnover for the 1998 season, eight are from the English league (Deloitte and Touche, 1999). How cruel an irony then, that the richest football club in the world is an international symbol for the third most deprived locality in England, and Liverpool Football Club, allegedly the tenth richest club in the world, resides in the most deprived part of England (see Table 1). Surely it is more than a quirk of fate that the industrial restructuring that has hit urban economies including Birmingham, Liverpool, Manchester and Newcastle, and the pockets of urban deprivation to be found in London, goes hand in hand with the worlds richest professional football clubs. On the face of it, this association between local deprivation and club wealth is somewhat simplistic. It is more pertinent to argue that place and football is a complex set of cultural, social and economic relations. For example, Manchester United resides in Salford and shares the city name with neighbours Manchester City. In the Liverpool travel-to-work-area there are also the professional clubs of Everton and Tranmere Rovers and in London there are, at present, ve Premier League clubs. However, if we accept that football has grown into a signi cant legitimate business activity then it surely follows that there is a need for ne w studies on its effects on the local economy. We know little about the businesses that support Premiership football on a day-to-day basis, or about the businesses that are typically situated around stadia, or how local economic development agencies interact with clubs. Williams (1997) argues strongly for a rede ned role for consumer services, one which disputes the notion that this is a sector

The index of deprivation in Table 1 is based on English local authority districts. Twelve indicators are used includin g overcrowde d households, derelict land, 17 year olds not in full time education , income support, children in income support households, low quali cations [GCSEs], and long term unemploymen t. Liverpool has 12 positive scores (i.e. is seen as deprived in all 12 areas measured) and has over 70 per cent of its population in the most deprive d wards. See Connolly and Chrisholm (1999) for a critique of this method of measurement.

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dependent on manufacturing and producer services. In this context, football can be active in local development by preventing spending leakage, persuading people to visit the area, and acting as a positive image for the locality, thereby encouraging economic growth. It is against such a background that the following case study has been prepared. The two Premiership clubs in Liverpool (Liverpool [LFC] and Everton [EFC]) are situated in close proximity to each other, in what might be termed a traditional working class enclave, separated only by a municipal park. Both clubs had signi cant success in the 1980s, followed by more modest achievements in the 1990s. Over the past few decades, the city itself has faced major political, economic and social upheaval. Over 180,000 jobs were lost in Merseyside between 1966 and 1981 a situation that has resulted in a persistent level of high unemployment. Simultaneously, there was a series of inner-city riots in the early 1980s and a dynamic set of political dog ghts that rarely escaped the front pages of the national press in the 1980s (see Boland, 1999; Gifford et al, 1989; Meegan, 1990, 1993; Merseyside Socialist Research Group, 1980).

& A STUDY OF P R E MIE R SHIP FOOTB ALL IN THE ME R SE YSIDE E C ONOMY At current levels, the three leading industry sectors in the Liverpool travel-towork-area are the wholesale and retail trade, manufacturing, and the health and social work sector. Each employs over 40,000 people from a working population of some 330,000. Employment in the local authority district of Liverpool alone shows how even more emphasis is placed on consumer and producer services. The health and social work sector is the largest, employing some 26,000 people, followed by the wholesale and retail sector employing around 25,000 people in just under 3,000 workplaces. The real estate, renting and business activities sector employs some 21,000. In manufacturing over 19,000 people are employed in Liverpool in less than a thousand workplaces (source ONS, per Nomis). It is notable, there fore, that recent comparative research on UK cities has shown demand for labour in the Merseyside economy declining at a steeper rate than labour supp ly and that this gap is growing at a faster pace than in any other urban economy (Turok and Edge, 1999). Because of this, a number of recent funding initiatives from government have been aimed at stimulating the local business base. Merseyside has won around 6 per cent of Single Regeneration Budget (SRB) money allocated to English authorities between 199499, worth some 275 million. There has also been a substantial amount of Regional Assistance into Merseyside, amounting to some 37 million between 1994 and 1997. However, it is the designation of Merseyside as an Objective 1 region, giving access to greater levels of European Structural Funds, that has proven most

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instrumental.3 A restructuring package worth around 1.5 billion was allocated to the sub-region, between 1994 and 1999. This consisted of 630 million from Europe matched by 630 million from UK government, and some 340 million pulled-in from the private sector. However, while the aim has been to redevelop the local infrastructure and provide a boost to local business con dence, the allocation of a second round of Objective 1 funding indicates the persistence of social and economic problems. Boland has argued how unemployment, economic activity and inactivity remain deeply problematic and entrenched problems on Merseyside (1999, p 791). The sub-region still faces severe restructuring dif culties and the image portrayed of Merseyside by national media and political commentators often causes much local angst. This is one reason why the current local economic development strategy for Liverpool recognises the importance of the service sector and argues how the array of business, cultural, education, health, nancial, commercial, retail, leisure, and entertainment services can support a growing international brand for the sub-region (Liverpool City Council, circa 1999, p 37). It is a belief drawn from a recent Service Sector Study that reported on the strengths and opportunities for the city in areas such as the arts, cultural studies, tourism and leisure (Liverpool City Council, circa 1999). Professional football ts neatly into this category and may well offer new opportunities for local development for Merseyside when the combined turnover of LFC and EFC, which totalled 55.5 million in the year 199798, is considered in more detail.
The clubs employment and basic business expenditure

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Objective 1 provide s the biggest allocation of restructuring fund s from Europe . It give s priority to job-creation and growth to reduce gaps between region s in per capita GDP. Unde r EC rules, only those regions with less than 75 per cent of the EU average GDP qualify for Objective 1 funding.

During 199798, LFC recorded a turnover of more than 45 million over a 15 month period. The club had an increase in direct operating expenses of 41.5 million, up from 23.7 in the previous year. This increase was mainly due to a rise in payroll expenditure of some 15.5 million and contributed to a reduced operating pro t down from 15.7 million in 199697 to just under 5 million for the period ending July 1998. The total wage bill for EFC during 1997/ 98 amounted to some 9.3 million. There is some degree of difference between the two clubs, with the gures for LFC clearly showing a greater turnover and expenditure in recent years. There are a number of reasons for this, but one explanation is the ground redevelopment at An eld (LFC) plus the decision by the club to build a centre for youth football development just outside of the city boundary in Knowsley, referred to as the Liverpool Academy. As Table 2 shows, most of the full-time employment in the clubs is taken up by playing and coaching staff, although a large proportion of administration staff are needed to support much daily activity. These gures also show that wage costs account for something like 47 per cent of the expense the clubs incur, demonstrating the extent to which they rely on their players, and often their star

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Table 2. An indication of turnover and employment c osts for the two c lubs (1997/ 98) Everton FC 1997 98 average attendance: 34,500 Employment 63 playing/coaching and managerial staff 8 ground staff 64 administrative staff 620 part-time match day staff (including stewards, catering etc.). Turnover 19,149,486 Employee costs 9,276,830 Basic utility costs Electricity Water Gas Telephone Police Fire Ambulance Local council Taxes Liverpool City Council Other local authority 9,316 22,534 No gures provided 11,151 117,804 1,068 5,460 44,795 5,538 Liverpool FC 1997 98 average attendance: 44,500 Employment 62 playing/coaching and managerial staff 44 ground staff 101 administrative staff 800 casual match day staff (including stewards, catering etc.). Turnover 36,365,600 Employee costs 16,755,200 Basic utility costs Electricity Water Gas Telephone Police Fire Ambulance 135,717 53,087 9,428 63,649 229,496 No gures provided 22,120 219,090 310,084 3,395

Council Taxes Liverpool City Council Knowsley Borough Council Other local authority

(Sou rce: gures provided by Everton and Liverpool Football Clubs)

players, who can command the highest salary. Of the 1.26 million spent on utilities, emergency services and local business rates, just over 582,000 nds its way back into the local economy through taxes payable to local authorities. The gures record how Liverpool City Council alone received over 260,000 in 1997/ 98 from the clubs. What is not shown here is the revenue generated on match days for the local authority through things such as match day coach and car parking. Also, the gures are essentially one-dimensional in that they do not help us gauge the extent of local match day trade, or the trade the clubs have with other local companies often an invisible part of the football business.

C lub suppliers and local businesses

To develop a better picture of how Premiership football is integrated in the local economy we surveyed a sample of the clubs, local suppliers and local businesses around the ground . To our knowledge, it is the rst survey of this

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type in England and it provides a useful starting point for academics and practitioners to assess the role of professional football in the local economy. Characteristics of club suppliers The survey of club suppliers was conducted during December 1998 drawn from the creditor list provided by the clubs. From a sample of 475 Merseyside rms, there was a resp onse rate of 16 per cent with 20 per cent of the 12.2 million worth of business between local suppliers and clubs captured. The survey demonstrated a relatively youthful supplier base of the two clubs consisting mainly of small and medium size enterprises (SMEs). Nearly four out of ten of the club suppliers began trading after 1988, although 18 per cent are well established, trading since before World War II. One rm in ve had an ultimate ownership that lay outside of the Merseyside sub-region: 16 per cent were UK owned, another 1 per cent owned by a European parent company, and a further 3 per cent were ultimately owned by companies operating from other parts of the world. Forty percent of supplier rms had between 0 and 9 employees, with a further 31 per cent employing between 10 and 49 people. The total number of people employed by those rms who took part in the survey was 3,886 and the 4 per cent of rms who employed over 250 people produced a relatively large mean gure of employment of 53. Three years ago the same rms employed 2,847 people, perhaps suggesting that the local Merseyside economy has been a little more buoyant in recent years, and we might speculate how this is consistent with UK economic performance and the application of Objective 1 funding. Four industry sectors account for over 80 per cent of rms in the survey. Nearly 30 per cent of rms are in the manufacturing and construction sectors but the largest proportion of businesses supplying the clubs come from the real estate, renting and business activities sector, accounting for over 26 per cent of suppliers. A quarter of suppliers come from the wholesale and retail sector and notably, businesses in the health sector made up over 6 per cent of suppliers (see Table 3). Linkages between clubs, suppliers and the local economy To gauge the extent to which the clubs are integrated into the local economy, we asked the rms for information on their total output, their output that went to the two clubs and the input they get from other local Merseyside sources (see Table 4). Nearly a third of rms who responded to this question had an output of between 1 million and 4.9 million and a further 13 per cent had a total output of over 5 million. Just under 55 per cent of rms had a total output in 1997 of under 1 million. These gures reinforce the point that most of the clubs suppliers are small rms, both in terms of employment and turnover, but also that some suppliers to the clubs are relatively large rms. The total value of

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Table 3.

Type of rm s upplying the football c lubs Number of rms 20 19 11 11 5 4 2 2 1 1 76 Percentage 26.3 25.0 14.5 14.5 6.5 5.3 2.6 2.6 1.3 1.3 100.0

Industry sector Real estate, renting and business activities Wholesale and retail Manufacturing Construction Health and social work Hotels and restaurants Transport, storage and communication Other community, social and personal services Financial inter-mediation Education Total
(Sou rce: authors survey results)

Table 4.

C lubs suppliers : base charac teris tics and linkages (1997) % 40.0 18.6 13.3 14.6 8.0 1.3 4.0 n 75 3,886 % 88.7 4.8 3.2 3.2 n 62 2.5 Firm output (s) 1 49k 50 99k 100 249k 250 499k 500 999k 1 4.9m 5m and above Response Total (m) Proportion of input from local economy 0 24% 25 49% 50 74% 75 100% Response % 8.3 8.3 15.0 10.0 13.3 31.6 13.3 n 60 159 % 22.7 10.6 27.3 39.4 n 66

Employment 0 9 10 25 26 49 50 99 100 199 200 249 250 and above Response Total Proportion of rm output to clubs 0 24% 25 49% 50 74% 75 100% Response Total (m)
(Sou rce: authors survey results)

output from those rms who replied to this question was 159 million, giving a mean value of some 2.6 million. We believe this mean gure of output at 2.6 million, and a mean employment gure of 53, to be slightly exaggerated. This is because the survey captured a small number of large rms, from the construction sector, recently involved in ground redevelopment at both EFC and LFC. The smallest gure of total output provided in the survey was just 10,000 and this compares with the largest gure of output at some 30,000,000. A crude calculation to scale up this gure to include all the 475 club suppliers would suggest an indication of their

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business activity in the local Merseyside economy of some 795 million (based on a multiplication of 5 as 20 per cent of trade was captured in the survey). It may be that a sizeable proportion of this trade leaks from the Merseyside economy. However, nearly four out of ten rms stated they relied on inputs from local Merseyside rms for between 75 per cent and 100 per cent of their total output, and a further 27 per cent felt that local inputs made up between 50 per cent and 74 per cent of output (see Table 4). Nearly a quarter of supp liers believed local inputs made up less than 25 per cent of their total output. Most of the suppliers are not over-dependent on the clubs. Nevertheless, the gures do suggest a considerable degree of local sourcing among the clubs suppliers and help us to estimate a multiplier effect for the two Premiership clubs in the city (see Table 5). Local businesses around the two football grounds To estimate the effect of Premiership football on trade around the two football grounds, 55 face-to-face structured interviews were held with local businesses in the surrounding area. There are a number of main roads that act as arteries to the grounds, along which many match day fans travel and we used an

The Midweek Match: P remiership Football and the Urban Economy

Table 5.

The impact of the c lubs on s upplier income and total employment

Impact on local income (multiplier effect after two rounds) Expenditure by the two clubs Amount remaining in the local Merseyside economy 55,515,086.00 12,200,275.00

Thus, 12.2 divided by 55.5 21.98. The rst round multiplier effect then is 0.22. The suppliers stated that 55 per cent of their business is sourced within the Merseyside economy. To reach the second round multiplier we use the formula 0.22 multiplied by 0:55 0:12. We then add 0.22 to 0.12 giving 0.34, meaning a multiplier effect of 1.34. This means that for every 1 spent by the two clubs combined, 34 pence stays in the Merseyside economy. Impact on employment (multiplier effect after one round) Suppliers estimate of their output going to two clubs Meaning a multiplier effect on employment of Number of jobs in the rms responding to the survey Number of jobs in clubs supplier base (survey gure multiplied by 5) Total number of jobs in supplier base multiplied by 0.09 Everton FC jobs Liverpool FC jobs Total jobs dependent on the two clubs
(Sou rce: authors survey results)

9.6% 1.09 3,886 19,430 1,749 135 (+620 PT) 207 (+800 PT) 2,091 (+1,420 PT)

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opportunistic sampling procedure to interview these businesses, all of which were actively trading via shop premises. It is the Walton (L4) district of Liverpool that envelops the two football grounds. In this district there are over 250 retail and wholesale businesses employing almost 2,800 people (source ONS, per Nomis). Around the football ground s there are two particular types of retail business that stand out. There are the general newsagents (confectionery, tobacco and newspapers) and the food stores, which include fast food sites. Of the 55 businesses that were surveyed for this part of the survey, 23 fell into these two categories, accounting for 68 jobs. Yet the type of business that provides most in terms of local employment are the local pubs and off-licence shops that are located near to the grounds, which employ 43 people, representing almost a quarter of all employment from those surveyed. Other forms of retailer typically to be found near the ground s include health, tness and beauty shops (such as chemists, sunbed hire and hairdressers), general household shops selling household hardware, clothes and sportswear shops, car accessories, a second-hand goods shop and a small number associated with the construction trade such as local glaziers. Of the 55 businesses interviewed, there were 86 male employees and 90 female employees, made up of 84 full-time and 88 part-time employees (the discrepancy due to a small number of owner-managers not including themselves in the latter gures). The highest number of people employed by a single business was 12 and the mean employment gure was 3. Although nine local businesses (16.3 per cent) stated that they took on extra staff on match days, 46 stated there was no need for this and some respondents even felt that the football crowds diminished trade. From the 55 businesses, 14 extra part-time staff and three extra full-time staff were required on match days. When we asked these businesses to provide a judgement on their levels of trade due to match days we received some surprising responses. Nearly 53 per cent stated there was no additional trade to be gained from match days, implying that there was no added value from their close proximity to the grounds. Some of the main concerns about proximity to the ground s were cited as closeness being unhelpful for business due to parking problems and traf c congestion, loss of trade, vandalism, theft and rubbish. Even so, almost one in six businesses estimated the value of match days to be in the region of 10 per cent of their approximate value in 1997, while one business stated that 40 per cent of trade was due to match days. From these estimates we calculated a mean gure for the value of match day trade to be in the region of 5.4 per cent. What this part of the work began to indicate to us was the form of retail that can be expected, away from the urban centre, existing in a typical traditional area around a professional football ground . Basically, this appears to be a low valueadded retail sector, which falls into the convenience store category, but

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importantly provides many local services and some employment opportunities for the population in the Walton district. & DISC USSION: THE EFF EC TS OF PR E MIE R SHIP FOOTB ALL ON AN URB AN E C ONOMY From the ndings of the two surveys we can begin to suggest some type of impact of professional Premiership football on an urban economy. We can do this by making certain assumptions about the data and by calculating a multiplier effect to show how much of the expenditure of the two clubs stays within the local Merseyside economy. We can then provide an estimation of how many jobs in the suppliers base are dependent on the two clubs.4 There are, however, three points that should be made here. First, these calculations are based on estimated values of trade provided by the suppliers themselves and may well be subject to some inaccuracy. Second, in recent years there has been considerable expenditure for redevelopment at both An eld and Goodison, at the respective training ground s and at the new Academy in Knowsley. This spending is likely to distort the multiplier effect, suggesting it is slightly higher than it would otherwise normally be. Third, these calculations do not include the effects of players wages that, if spent in the Merseyside economy, would make an important contribution to any calculation. What we present, therefore, is a base line rst indicator of the effects of Premiership football on an urban economy. The two clubs had a combined expenditure of 12.2 million with local suppliers in Merseyside in 199798 drawn from a total expenditure of 55.5 million. Using these gures, we can calculate a rst round multiplier effect on local trade (income) of 1.22 (see Table 5). We can then estimate a second round multiplier based on the local Merseyside rms who supply the clubs suppliers. In the survey the clubs suppliers indicated to us that 55 per cent of their business is sourced within Merseyside, meaning that 45 per cent of their business is lost to outside the Merseyside economy and we can use these gures to calculate a second round multiplier effect.5 After two rounds, we can say that the multiplier effect on income of the two clubs is 1.34, or from another perspective, for every 1 spent by the two clubs combined, 34 pence stays in the local Merseyside economy. In a similar way, we can estimate how many jobs in the suppliers base are dependent on trade with the two clubs. We calculated that 3,886 jobs are associated with the suppliers captured in the survey. The survey based on suppliers own estimates shows an average 9.6 per cent of total business output going to the two clubs. From this we can suggest that, of the 3,886 jobs captured in the survey, around 1 in 11 is dependent on trade with the clubs (350 jobs). Or put another way, there is a rst round multiplier effect on employment of 1.09, meaning that for every 100 jobs that exist in the club suppliers, nine are dependent on the trade the rm has with the

The Midweek Match: P remiership Football and the Urban Economy

For example , if a supplie r to the clubs with a turnover of 10 million and a workforce of 50 employees has 50 per cent of its output by value to the clubs, then 5 million of its turnove r and 25 employees would be thought of as depende nt on the professiona l football industry. This would be referred to as rst round This is a recognition of the knockon effect of any business that is lost by rms who had supplied the clubs.

We do this by using the round 1 gure multiplied by the percentage source d in the local economy, with the latter gure being divide d by 100.

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clubs. However, to try to gauge the effects of the clubs on the employment of all their suppliers some 475 rms we need to scale up from the 20 per cent of total trade the survey captured. When we multiply the jobs gure by ve, it provides an indication that some 1,750 jobs in the Merseyside economy rely on business between the two football clubs and their 475 local suppliers. Thus, after one round of calculating the multiplier effect on employment, we can provide an initial estimation that over 2,000 full-time jobs are dependent on the presence of the clubs and the trade local rms have with the clubs (see Table 5). In addition, the mean gure for the value of match day trade from the survey of local businesses was 5.4 per cent. This suggests that, for every 1 spent in the retail businesses around the two grounds, some 5 pence is attributable to match days and that for every 100 jobs in local retail businesses, ve are due to match day business. While this indicates a small multiplier effect on income and employment due to match day trade, at around 1.05, it is a gure that should be treated with caution, as we have been unable to corroborate it. We do not know how many of the 2,800 retail jobs in Walton are located near to the ground, but using these gures as a crude proxy we can say that the maximum number of retail jobs dependent on match day trade in the L4 district would be no more than 140. These results suggest that, in spite of all the rhetorical hype about football as a business, there is much to do to understand the way in which Premiership clubs interact with their local economy. Research into this area has been neglected, not least because of the traditional orthodoxy that would say consumer services, such as professional football, is a parasitic activity in the local economy. The evidence presented here would dispute this view and begins to show the extent to which Premiership clubs are part of the value chain in the consumer services sector. Williams (1997) made a similar point when he argued
there remain many op portunities for local sourcing and growth in sectors which appear to be super cially unrelated to sport. To achieve this, however, the interdependencies between sport and other economic sectors must be recognized (Williams, 1997, p. 89)

Our work has uncovered such inter-dependency between sport and the local economy. Many small and medium sized rms trade with clubs on a day-to-day basis. Yet, perhaps both the footballing bodies and local governance agencies have failed, up to now, to recognise the potential that exists here, for instance if greater ef ciencies could be achieved in the suplier networks that serve Premiership clubs. For example, business clusters are generally associated with those sectors regarded as motors of development, and often include manufacturing, high technology and high value-added producer services (see Simmie, 1997; Longhi, 1999). Yet, if we accept Williams (1997) rede ned role for consumer services,

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there is no reason why the principles of clusters could not be applied in local sourcing for football. We did, in fact, nd some evidence of recent churn in the club supplier base. As in other industries, levels of business between the clubs and suppliers had recently undergone some qualitative change. One supplier stated how the clubs homely business approach has recently changed from 934 to a more clinical attitude, while another made the point that our company has only just started to supply [the club]. We hope they will become a senior client. Another response stated LFC and EFC are very high pro le clients which has a value beyond purely monetary. Although Premiership football is only one part of the consumer services sector, it is a dynamic area of economic growth which could well have signi cant impacts in localities, but which appears not to be seriously considered as an item for local economic policy. & SUMMARY: FURTHER R E SE ARC H AND P OLIC Y ISSUES Our attention in this article has been on one aspect of Premiership football and place. This focus, on club supliers and the businesses around stadia, is a rst step towards a greater examination of Premiership football in the local economy. While we have presented a base line indicator of the contribution of clubs, further research is necessary to corroborate the quanti able affects of football. This would facilitate a more informed debate on how football-related expenditure can be retained within the local economy, and help us to think about related links to tourism. We are aware that the role of football in an urban economy is also about social and cultural relations, which are much more dif cult to quantify. Urban-based professional football clubs are often regarded as a locus of local culture and a symbol of place that provide a distraction from local industrial decline. For this reason, there is a need for work of a qualitative nature that takes account of how Premiership clubs might support civic boosterism and place marketing initiatives. There are also issues of how embedeed Premiership clubs are in their locality as they increasingly look to global markets, and how this may impact on local communities. Few, if any, urban plans have developed a blueprint for the future of professional football in the locality. However, the characteristics of club suppliers and linkages with the local economy do raise important policy issues for both clubs and local business support agencies in Merseyside. There is a signi cant amount of public nance nding its way into the sub-region from Europe and the UK government. With this in mind, if the professional game is considered important to the local economy then surely it is in need of some strategic development. This would require a number of actions. For example, better sector-based market intelligence will help economic development agencies to target supp ort for businesses more ef ciently. This should include a more

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thorough understanding of the role of consumer services and, where appropriate, professional sport. Second, in the case of Liverpool, regeneration of the L4 district could surely be implemented in an association of communities, clubs, local businesses and the local authority. This could be developed further into a city-wide football and local economy strategy, and a concomitant issue would be the facilitating of an appropriate partnership, coalition or network of stakeholders who would ensure progress. Nevertheless, a well thought-out approach to professional football as a local economic development tool would enable governance agencies to access funding mechanisms like the SRB and, in the case of Merseyside, Objective 1 Structural Funds. This could be multi-focused and targeted at club-supplier linkages, local retail fascia upgrading, city-based tourism, community-based business development and even social issues, including housing and crime. In addition, more bottom-up thinking of sport-led econoic development policies could encourage central government to think differently about prestige stadia development, such as the recent decision to upgrade Wembley Stadium, and to consider a strategic national-level spatial policy towards the sports sector (Williams, 1997, 89). Finally, while there can be no guarantee of Premiership football continuing its vogue trend there is a current challenge to maximise the wealth being generated for the bene t of the locality. If thought through adequately, the matching up of football and place would provide an approach well suited to address issues of social exclusion.
Acknowledgements This article draws on the ndings of research commissione d from Everto n and Liverpoo l Football Clubs, from the Merse y Partnership and Liverpoo l City Council. We are gratefu l for their supp ort and the contribution s of the clubs and those who took part in the survey. R eferenc es

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