How will the Commonwealth Games affect
Birmingham’s health and unemployment problems?
Student: hng186
School: 004359
World Studies
Theme: Health and Development
Subjects: Sports, Exercise and Health Science; Economics
Word Count: 3917 [excluding Title Page, Contents Page and Bibliography]
1
Contents
Introduction ........................................................................................................................... 3
Methodology ......................................................................................................................... 6
The nature of the current health crisis in Birmingham .......................................................... 7
Why obesity is a concern .................................................................................................. 7
The main causes of obesity in Birmingham....................................................................... 9
The nature of the unemployment situation in Birmingham ...................................................12
Birmingham’s unemployment ...........................................................................................12
Why Birmingham’s unemployment rate is still so high .....................................................13
How Birmingham 2022 acts as a solution ........................................................................15
The likely effects of the Commonwealth Games on Birmingham .........................................16
Levels of physical activity and sport participation .............................................................16
Investment and immediate growth ...................................................................................18
Employment .....................................................................................................................21
Long-term growth .............................................................................................................22
Conclusion ...........................................................................................................................24
Bibliography .........................................................................................................................27
2
Introduction
Birmingham, in the West Midlands, UK, will be hosting the Commonwealth Games in 2022.
The research question “How will the Commonwealth Games affect Birmingham’s
health and unemployment problems?” is important as the city is experiencing a health
crisis; an NHS study1 found that 25% of year 6 children in Birmingham were obese in 2018,
one of the highest childhood obesity rates in the country, whilst 41% were classed as
overweight.
Figure 1. percentage of year 6 children who are obese. Source: NHS
Drew Craythorne, "Birmingham Has One of the Highest Childhood Obesity Rates in England,
Figures Reveal. - Birmingham Updates", Birmingham Updates, 2018
<https://www.birminghamupdates.com/birmingham-has-one-of-the-highest-childhood-obesityrates-in-england-figures-reveal/> [Accessed 23 May 2019].
10% of the NHS’ budget is spent on diabetes treatment and the prevalence of the disease
is expected to rise between now and 20252; the issue is becoming increasingly expensive.
1
Drew Craythorne, "Birmingham Has One of the Highest Childhood Obesity Rates in England, Figures
Reveal. - Birmingham Updates", Birmingham Updates, 2018
<https://www.birminghamupdates.com/birmingham-has-one-of-the-highest-childhood-obesity-rates-inengland-figures-reveal/> [Accessed 23 May 2019].
2 "Cost Of Diabetes", diabetes.co.uk, 2019 <https://www.diabetes.co.uk/cost-of-diabetes.html> [Accessed 24
May 2019]
3
As Birmingham’s childhood obesity rate is higher than the national average – increasing the
likelihood of developing type 2 diabetes3 – Birmingham in particular needs to address this
issue.
Hosting the Commonwealth Games is expected to be a solution; Sport Birmingham’s
“Investing in Active Lives” programme intends to transform Birmingham into the city “with
the most improved levels of physical activity participation in the country4”. It has potential to
positively impact Birmingham, with more young people regularly exercising to lower their
risk of developing diabetes5.
The question is also important as Birmingham’s unemployment rate was more than double
the national average in 20186. Of the 10 UK constituencies with the highest number of
unemployment benefit claims, 5 were from Birmingham7. The Games are expected to
create over 4,000 jobs a year until 2022, whilst £526mn will be invested in the local area8.
This should reduce the unemployment rate and encourage business investment9. The
3
"Understanding Excess Weight And Its Role In Type 2 Diabetes Brochure - Obesity Action
Coalition", Obesity Action Coalition, 2019 <https://www.obesityaction.org/get-educated/publicresources/brochures-guides/understanding-excess-weight-and-its-role-in-type-2-diabetes-brochure/>
[Accessed 24 May 2019]
4 Birmingham City Council, "Commonwealth Games Bid 2022 | Birmingham City
Council", Birmingham.Gov.Uk, 2019
<https://www.birmingham.gov.uk/info/50116/commonwealth_games_bid_2022/1281/commonwealth_games_
bid_2022> [Accessed 23 May 2019].
5 Lisa M. Leontis RN, ANP-C, and RD Jodi Godfrey, "Type 2 Diabetes Prevention: Here's What You Can
Do", Endocrineweb, 2019 <https://www.endocrineweb.com/conditions/type-2-diabetes/type-2-diabetesprevention> [Accessed 29 May 2019]
6 Ottewell, D. and Rodger, J. (2019). How the unemployment rate in Birmingham has soared since January.
[online] birminghammail. Available at: https://www.birminghammail.co.uk/news/midlands-news/howunemployment-rate-birmingham-soared-15144472 [Accessed 27 May 2019].
7 Tapsfield, J. (2018). Birmingham accounts for HALF of top 10 benefits claiming areas in UK. [online] Mail
Online. Available at: https://www.dailymail.co.uk/news/article-6151921/Birmingham-accounts-HALF-10highest-claiming-areas-unemployment-benefits-UK.html [Accessed 27 May 2019].
8 Elkes, Neil, "How Many Jobs Will 2022 Commonwealth Games In Birmingham Create", Birminghammail,
2019 <https://www.birminghammail.co.uk/news/midlands-news/jobs-commonwealth-games-birminghammoney-14012749> [Accessed 27 May 2019]
9 Pettinger, Tejvan, "Advantages Of Hosting A Major Event | Economics Help", Economicshelp.Org, 2019
<https://www.economicshelp.org/blog/4909/economics/advantages-of-hosting-a-major-event/> [Accessed 27
May 2019]
4
multiplier effect states that growth in economic activity exceeds the initial injection that
caused it10; the £526mn government stimulus should have an even greater effect on
Birmingham’s economy, lowering the unemployment rate and addressing location-specific
deprivation.
Birmingham’s main concern is cyclical unemployment, where aggregate demand is too low
to incentivize higher economic output and demand for labour is low; structural
unemployment is also problematic with language barriers and skill mismatches prevalent.
The city has one of the highest proportions of temporary workers in the UK11, suggesting a
lack of incentive for firms to invest in long-term contracts. There is a shortfall in innovative
workers who need long time periods to implement new ideas12, leading to a reduction in the
level of entrepreneurship in the city. As contracts are short, firms lose the incentive to train
workers as the payback period is too short to be profitable, causing the skill level to fall and
contributing to Birmingham’s unemployment crisis; firms would rather invest somewhere
with a skilled labour force than Birmingham.
The 2022 Games offered a solution; 12,500 volunteers would be trained for the event13,
gaining transferrable skills and making them more employable. In turn, businesses would
be incentivized to invest in the city, causing demand for labour to rise.
10
Riley, Geoff, "Explaining The Multiplier Effect | Economics | Tutor2u", Tutor2u, 2019
<https://www.tutor2u.net/economics/reference/multiplier-effect> [Accessed 27 May 2019]
11 "Why Is Birmingham’S Unemployment Rate Still One Of The Highest In The UK Despite Generating 69K
Jobs Last Year? | Shelforce", Shelforce, 2018 <https://www.shelforce.com/news/why-is-birminghamsunemployment-rate-still-one-of-the-highest-in-the-uk-despite-generating-69k-jobs-last-year/> [Accessed 28
May 2019]
12 Lisi, Domenico, and Miguel A. Malo, "The Impact Of Temporary Employment On Productivity", Spingerlink,
2017 <https://link.springer.com/article/10.1007/s12651-017-0222-8> [Accessed 28 May 2019]
13 "Birmingham Commonwealth Games 2022 | GBCC", Greaterbirminghamchambers.Com, 2019
<https://www.greaterbirminghamchambers.com/research-campaigning/hot-topics/birmingham-commonwealthgames-2022/> [Accessed 28 May 2019]
5
Methodology
The research question states:
“How will the Commonwealth Games affect Birmingham’s health and unemployment
problems?”
This can be broken down into three objectives:
1. To explore the nature of the current health crisis in Birmingham
2. To analyse the unemployment situation in Birmingham
3. To evaluate the likely that impacts the Commonwealth Games will have on
Birmingham
The extent to which obesity and unemployment are prevalent in Birmingham will be
analysed, as well as causing factors. Secondary data figures on unemployment, obesity
and healthcare cost will be used. The proposed solutions to these problems will then be
analysed to see whether they appropriately address the concerns.
Data will be gathered from previous events which had similar objectives to Birmingham to
provide evidence for the evaluation, namely the London 2012 Olympics, Glasgow 2014
Commonwealth Games and Gold Coast 2018 Commonwealth Games. Figures such as
changes in physical activity and job creation will be collated and used to evaluate the likely
impacts on Birmingham.
6
The nature of the current health crisis in Birmingham
This section will analyse the nature of the health crisis in Birmingham and its causing
factors.
Why obesity is a concern
Obesity is a global issue, problematic because it has severe social and economic impacts,
and is becoming more widespread. It affects people’s quality of life by increasing the
prevalence of chronic diseases, such as diabetes, and reduces life expectancy by 3 years
for moderate obesity and 8-10 years for morbid obesity14. Obese people are more likely to
have mental health issues, having knock-on negative impacts on society.
The main economic concern is that obesity is expensive to treat; the NHS spent £6.1bn on
overweight and obesity-related ill health in 2014-1515. It hampers economic development,
with the wider effects on society amounting to £27 billion16, and has the potential effect of
dissuading business investment. The prevalence of illness means that workers take more
days off than in healthier cities, so firms may be inclined to locate someplace where the
14
Wellbeing Board, Birmingham Health and, Fit For The Future Birmingham's Childhood Obesity
Strategy (Birmingham: Birmingham City Council, 2013), p. 1
<https://www.birmingham.gov.uk/download/downloads/id/8102/fit_for_the_future_childhood_obesity_strategy.
pdf> [Accessed 29 May 2019]
15 England, Public Health, "Health Matters: Obesity And The Food Environment", GOV.UK, 2017
<https://www.gov.uk/government/publications/health-matters-obesity-and-the-food-environment/healthmatters-obesity-and-the-food-environment--2> [Accessed 30 May 2019]
16 ibid
7
workers are more productive and efficient. As obesity also reduces self-confidence, workers
may less productive due to low self-esteem and poor mental health17.
Fig. 2 Costs of obesity to the UK government and society
Source: gov.uk “Public Health England” <https://www.gov.uk/government/publications/health-mattersobesity-and-the-food-environment/health-matters-obesity-and-the-food-environment--2>
Figure 2 shows that more money is spent on obesity than the police, fire and judicial
services combined; obesity is not only affecting workforce productivity, but also creates
allocative inefficiency, where society would benefit from less resources being allocated
towards obesity treatment and more on public goods/services.
17
England, Public Health, "Health Matters: Obesity And The Food Environment", GOV.UK, 2017
<https://www.gov.uk/government/publications/health-matters-obesity-and-the-food-environment/healthmatters-obesity-and-the-food-environment--2> [Accessed 30 May 2019]
8
Fig. 3 Trends in childhood obesity in Birmingham and England 2006/07 to 2011/12
Source: Childhood Obesity – Joint Strategic Needs Assessment, Birmingham City Council,
<https://www.birmingham.gov.uk/download/downloads/id/8103/jsna_childhood_obesity.pdf>
Figure 3 shows changes in childhood obesity rates from 2006 to 2012, and the gap
between Birmingham and the national average. For both reception and year 6 children,
Birmingham’s obesity rate is higher than England’s, and the graph shows an increase in the
size of the gap over the six-year period, from 3.1% to 5.2%. It also shows a rise in
Birmingham’s obesity rate in year 6 children from 20.6% to 24.4%; one in four children are
obese. Not only is Birmingham’s obesity problem getting worse, but it is developing at a
quicker rate than the rest of the country.
The main causes of obesity in Birmingham
Obesity is caused by multiple factors, so there is not a single fix to the problem. However,
obesity prevalence in the most deprived 10% of children is approximately double that of the
9
least deprived 10%18. Research shows that there is a ‘strong relationship between obesity
and low socioeconomic status’19, implying that their relationship is causal; addressing the
extent of deprivation in Birmingham should reduce the prevalence of obesity.
Fig. 4 Relationship between density of fast food outlets and level of deprivation
Source: gov.uk “Public Health England” <https://www.gov.uk/government/publications/health-mattersobesity-and-the-food-environment/health-matters-obesity-and-the-food-environment--2>
Figure 4 shows there are more fast-food outlets in deprived areas than affluent ones,
making it easier for children to purchase unhealthy food and increasing their obesity risk. If
families are able to afford healthier food – from a reduction in the level of unemployment
and deprivation – the demand in the area for fast-food will shrink and subsequently the
18
England, Public Health, "Health Matters: Obesity And The Food Environment", GOV.UK, 2017
<https://www.gov.uk/government/publications/health-matters-obesity-and-the-food-environment/healthmatters-obesity-and-the-food-environment--2> [Accessed 30 May 2019]
19 Loring, Belinda, and Aileen Robertson, Euro.Who.Int, 2014
<http://www.euro.who.int/__data/assets/pdf_file/0003/247638/obesity-090514.pdf> [Accessed 5 August 2019]
10
number of fast-food outlets will fall. People’s diets will be healthier and less people will be
overweight.
Another cause of Birmingham’s obesity crisis is its extremely inactive population. 80% of its
1.1-million population are classed as inactive20, increasing the likelihood of becoming
overweight and developing associated health issues. This high inactivity rate has again
been linked with deprivation; the poorer people are, the more likely they are to be
sedentary21, and with 40% of Birmingham’s citizens living in the top 10% of the England’s
most deprived households22 it is easy to see why the inactivity is so prevalent. In order for
obesity to be tackled successfully in the long run, lifestyle changes will have to be made
whereby children are habitually doing more and sitting less, and adult communities are
generally fitter.
The council has made previous attempts to provide solutions to those living in deprived
areas; they introduced a ‘healthy start’ scheme where families on benefits were offered food
vouchers to purchase milk, fruit, and vegetables, worth £3.10 for each child a week 23.
However, the scheme proved to be unsuccessful, with £1.5 million worth of vouchers going
unused24. A financial incentive alone proved to be not enough, with deeply engraved
unhealthy habits making it hard for overweight families to break out of their cycle of obesity;
a different and perhaps more innovative solution will be required.
"Birmingham’s Blueprint For Behaviour Change - Coachwise", Coachwise, 2019
<https://www.coachwise.ltd.uk/blog/birminghams-blueprint-behaviour-change/> [Accessed 2 June 2019]
21 ibid
22 ibid
23 Jackson, Carl, "Birmingham Facing Rising Childhood Obesity Epidemic", Birminghammail, 2018
<https://www.birminghammail.co.uk/news/local-news/birmingham-facing-rising-childhood-obesity-14906580>
[Accessed 7 June 2019]
24 ibid
20
11
The nature of the unemployment situation in Birmingham
This section will analyse the current unemployment situation in Birmingham and reasons
why it has one of the highest claimant rates in the UK.
Birmingham’s unemployment
Much like its obesity situation, Birmingham has an unemployment problem significantly
worse than the national average. In April 2019, Birmingham’s seasonally adjusted claimant
unemployment rate was 8.1%25, nearly 5% above the UK average of 3.2% as shown in
Figure 5. It is one of the UK’s worst 10 cities for unemployment26, which is worrying as it is
the second-most populated UK city27; not only is the unemployment rate very high, but a
larger absolute number of people are out of work too.
Fig. 5 Claimant Unemployment in Birmingham, the West Midlands region and the UK
Source: Council, Birmingham City, "Labour Market Update April 2019 | Birmingham City
Council", Birmingham.Gov.Uk, 2019
25
Council, Birmingham City, "Labour Market Update April 2019 | Birmingham City
Council", Birmingham.Gov.Uk, 2019
<https://www.birmingham.gov.uk/downloads/file/12673/labour_market_update_april_2019> [Accessed 7 June
2019]
26 "10 Worst Cities For Unemployment", Telegraph.Co.Uk, 2019
<https://www.telegraph.co.uk/finance/jobs/9142942/10-worst-cities-for-unemployment.html?image=2>
[Accessed 7 June 2019]
27 Worldpopulationreview.Com, 2019 <http://worldpopulationreview.com/countries/united-kingdompopulation/cities/> [Accessed 7 June 2019]
12
However, looking back at Birmingham’s unemployment rate over time, it has actually seen
a significant improvement. In 2011, the rate was a staggering 15%, and the current rate of
8% is the lowest it has been in nine years28 despite it still being one of the UK’s highest.
The reason that Birmingham is still concerned about its unemployment, despite it having
dropped by nearly 50% over the past 8 years, is because of the prevalence of youth
unemployment (between 20 and 24 years old). One in five young adults are out of work and
people in this age group are twice as likely to be unemployed than the national rate 29. This
is problematic as these young adults are likely new to the labour market. If upon entry they
experience unfavourable economic conditions, they are susceptible to reduced self-esteem
and are likely to be discouraged from working in the future. Long-term negative impacts are
likely to arise from this, potentially leading to hysteresis (whereby current economic
conditions lead to a permanent rise in the natural rate of unemployment30) which could
hamper Birmingham’s growth in the future. These young people are the workforce of
tomorrow, so Birmingham needs to give them a reason to stay motivated.
Why Birmingham’s unemployment rate is still so high
One main reason for Birmingham’s unemployment rate being so high is the low skill level of
the labour force. There are severe skill mismatches in Birmingham, with 21% of the working
age population having no qualifications compared to the national average of 16%31,
28
Gouk, Annie, and James Rodger, "Millennial Unemployment In Birmingham Rises At Scarily Quick
Rate", Birminghammail, 2019 <https://www.birminghammail.co.uk/news/midlands-news/millennialunemployment-birmingham-soaring-frighteningly-16181019> [Accessed 7 June 2019]
29 ibid
30 "Hysteresis | Economics | Tutor2u", Tutor2u, 2019 <https://www.tutor2u.net/economics/topics/hysteresis>
[Accessed 5 August 2019]
31 Qualifications In Birmingham (Birmingham: Lesley Bradnam, 2019), p. 32
<https://www.birmingham.gov.uk/download/downloads/id/2475/qualifications_in_birmingham_revised_april_20
17.pdf> [Accessed 5 August 2019]
13
resulting in structural unemployment. Additionally, only 25% of the working age population
are qualified to degree level or above, compared to 30% in England, as shown in Figure 6.
Fig. 6 Percentage of population with qualifications in Birmingham and England
https://www.birmingham.gov.uk/download/downloads/id/2475/qualifications_in_birmingham_revised_april_
2017.pdf
From a business point-of-view, Birmingham is a poor location to invest in. Its working age
population is less skilled than the rest of the country, disincentivizing as production would
be more efficient in a better-skilled area. These skill mismatches cause a fall in the demand
for labour from DL1 to DL2 in Figure 7, causing the employment level to fall from QL1 to
QL2, hence Birmingham’s unemployment rate being significantly higher than the national
average.
Fig. 7 Birmingham’s labour market
S
Wage rate
Inward shift of DL curve
caused by Birmingham’s
low skill level.
14
DL2
QL2
QL1
DL1
Quantity of labour
How Birmingham 2022 acts as a solution
The Birmingham City Council believe that Birmingham 2022 will address its unemployment
issue. A predicted 4500 jobs will be created annually up until 2022, whilst 12500 volunteers
will be provided with skills training32, increasing their employability and incentivizing
businesses to invest in the local area. This is a small step forwards in addressing the lack of
skills and qualifications that the working age population currently experiences. £526mn is
expected to be contributed to the West Midlands economy33, whilst the Council states that
broadcasting on global television – to a global audience of 1.5bn34 – will ‘showcase
investment potential35’. Broadcasting will attract foreign investment and create an
immediate economic boost, followed by long-term growth caused by the positive image
creation of Birmingham.
Furthermore, in preparation for the event, many infrastructure projects have been brought
forward, such as new Metro tram lines and bus systems36. In doing so, the demand for
32
Hodson, Tom, "The Economic Impact Of The Commonwealth Games In Birmingham", Sevencapital, 2018
<https://sevencapital.com/birmingham-property-news/economic-impact-commonwealth-games-inbirmingham/> [Accessed 5 August 2019]
33
Elkes, Neil, "How Many Jobs Will 2022 Commonwealth Games In Birmingham Create", Birminghammail,
2017 <https://www.birminghammail.co.uk/news/midlands-news/jobs-commonwealth-games-birminghammoney-14012749> [Accessed 5 August 2019]
34
2022, Birmingham, "£778M Investment In Birmingham And The West Midlands To Deliver 2022
Commonwealth Games - B2022", B2022, 2019 <https://www.birmingham2022.com/news/blog/778minvestment-in-birmingham-and-the-west-midlands-to-deliver-2022-commonwealth-games/> [Accessed 6
August 2019]
35
Hodson, Tom, "The Economic Impact Of The Commonwealth Games In Birmingham", Sevencapital, 2018
<https://sevencapital.com/birmingham-property-news/economic-impact-commonwealth-games-inbirmingham/> [Accessed 5 August 2019]
36
ibid
15
labour increases and jobs are created. More importantly, however, these transport
developments are expected to have long-lasting legacy effects. Commute times will be
reduced, meaning employees spend less time traveling and more time working, whilst the
reduced congestion means that worker morale is improved. This should boost the
productivity of the economy and allow for increased economic growth.
Melbourne, London and Glasgow had similar infrastructure development projects
implemented for their Games, as well as plans to increase activity levels and provide
employment opportunities like Birmingham. I will be using them as case-studies, taking
previous evidence to evaluate Birmingham’s likely outcome in the next section.
The likely effects of the Commonwealth Games on Birmingham
This section will look at data from Melbourne 2018, Glasgow 2014 and the 2012 London
Olympics to see whether trends can be found regarding the unemployment, physical activity
and economic growth before and after the events. An evaluation will be made on
Birmingham’s likely effects.
Levels of physical activity and sport participation
One of the targets of Birmingham 2022 is to “inspire communities and athletes to realise
their full potential and live happier, healthier lives 37”; the Games are expected to inspire
local communities to become more active, reducing the number of overweight and obese
people.
37
"Our Purpose | Birmingham 2022 Commonwealth Games", B2022, 2019
<https://www.birmingham2022.com/about-us/our-purpose/> [Accessed 6 August 2019]
16
But using Glasgow as an example, it appears this may not be an effective solution. In 2014,
Scotland introduced a 10-year “Active Legacy” plan to tackle physical inactivity amongst
children and teenagers, part of its bid to host the 2014 Commonwealth Games38. A report
two-years-on found a “huge growth in the sport [athletics] across all levels39”, implying that
in certain sports there have been positive effects. But this increased participation is not
consistent across all areas, with the number of children who meet the recommended
physical activity guidelines in Scotland falling by 3.9% in 201540. It also shows that for 25-34
year olds – the young, economically active adults – this figure has too decreased by 8.3%41.
Despite investing over £500mn to host, Glasgow appear to have failed in creating an active
legacy, with the Committee seeing “no current evidence42” of one. Levels of physical
inactivity amongst children and young adults remain high and there has been no large-scale
lifestyle change. This could be down to the large influence parents have over their
children’s lifestyle; if raised unhealthily, being inactive becomes a habit regardless of
influences43, so exposure to a sporting event wouldn’t be enough to inspire sport uptake.
Girls are 10 times as likely to be overweight if their mothers are obese44, so the community
engagement might not have been enough to undo deeply engrained family habits, thus
making Glasgow unsuccessful in creating an active legacy.
Challis, Lynda, "Fit For Nothing: Where It All Went Wrong For Glasgow’s Commonwealth Games Legacy |
Bournemouth University", Bournemouth.Ac.Uk, 2018 <https://www.bournemouth.ac.uk/news/2018-04-13/fitnothing-where-it-all-went-wrong-glasgow-s-commonwealth-games-legacy> [Accessed 6 August 2019]
39 Sp-Bpr-En-Prod-Cdnep.Azureedge.Net, 2019 <https://sp-bpr-en-prodcdnep.azureedge.net/published/HS/2017/5/3/Sport-for-Everyone-Interim-Report/4th%20Report.pdf>
[Accessed 6 August 2019]
40 ibid
41 ibid
42 ibid
43 "'Fat Mums Have Fat Daughters'", Nhs.Uk, 2009 <https://www.nhs.uk/news/obesity/fat-mums-have-fatdaughters/> [Accessed 6 August 2019]
44 ibid
38
17
The London 2012 Olympics was the first Games ever to attempt to increase physical
activity levels as a legacy outcome45. It had some successes; 89% of people who signed up
to the Sportivate programme were still regularly playing 3 months later46, whilst the School
Games initiative registered 13600 schools, surpassing its target of 1200047. However, the
legacy promise wasn’t fulfilled, with figures showing no more young people participating in
sport than before the games48. Like Glasgow, whilst some increases in activity levels were
recorded, it wasn’t on a citywide scale as intended. Perhaps not as relatable as London and
Glasgow, but the Sydney 2000 Olympics actually recorded a fall in activity due to more
Australians watching sport on TV and less actually playing it themselves 49. Looking at data
from three events, it seems Birmingham is unlikely to achieve its goal in increasing activity
levels.
Investment and immediate growth
Given that £778mn is being invested into delivering the Commonwealth Games 50, it would
be impossible for an economic boost not to be felt in the West Midlands area. The question
therefore becomes whether it will provide net benefits i.e. whether the boost outweighs the
Challis, Lynda, "Fit For Nothing: Where It All Went Wrong For Glasgow’s Commonwealth Games Legacy |
Bournemouth University", Bournemouth.Ac.Uk, 2018 <https://www.bournemouth.ac.uk/news/2018-04-13/fitnothing-where-it-all-went-wrong-glasgow-s-commonwealth-games-legacy> [Accessed 6 August 2019]
46 Robertson, Hugh, "London 2012 Construction's £7.3 Billion Impact On UK Economy", GOV.UK, 2012
<https://www.gov.uk/government/news/london-2012-constructions-7-3-billion-impact-on-uk-economy>
[Accessed 6 August 2019]
47 ibid
48 Challis, Lynda, "Fit For Nothing: Where It All Went Wrong For Glasgow’s Commonwealth Games Legacy |
Bournemouth University", Bournemouth.Ac.Uk, 2018 <https://www.bournemouth.ac.uk/news/2018-04-13/fitnothing-where-it-all-went-wrong-glasgow-s-commonwealth-games-legacy> [Accessed 6 August 2019]
49 ibid
502022, Birmingham, "£778M Investment In Birmingham And The West Midlands To Deliver 2022
45
Commonwealth Games - B2022", B2022, 2019 <https://www.birmingham2022.com/news/blog/778minvestment-in-birmingham-and-the-west-midlands-to-deliver-2022-commonwealth-games/> [Accessed 6
August 2019]
18
initial investment, whilst accounting for any resulting negative externalities. An example of
this would be the helium balloon littering that Melbourne suffered following the 2018 Gold
Coast Commonwealth Games, harming the local fishing and agriculture industries51.
The Games will create 4300 jobs a year until 202252 whilst benefitting Birmingham’s
economy with infrastructure improvements and tourism revenue. £778mn will be invested
overall but Birmingham can expect the multiplier effect to take place, whereby the final
contribution to GDP exceeds that of the initial injection53. Evidence can be found from the
Gold Coast Games, where the £990,00054 spent by the government was exceeded by the
£1.3bn boost the Queensland economy received55. Similarly, the Scottish government
spent £543mn hosting the Glasgow Games56 and experienced a £740mn boost, with
£390mn going directly into Glasgow’s economy57. For London 2012, an estimated £8.9bn
was invested to stimulate £9.9bn worth of trade and investment in the UK58.
51
Larkins, Damien, and Gabrielle Lyons, "Sustainability Focus For Gold Coast Commonwealth Games", ABC
News, 2016 <https://www.abc.net.au/news/2016-06-02/sustainability-focus-gold-coast-commonwealth-games2018/7471010> [Accessed 6 August 2019]
52 2022, Birmingham, "£778M Investment In Birmingham And The West Midlands To Deliver 2022
Commonwealth Games - B2022", B2022, 2019 <https://www.birmingham2022.com/news/blog/778minvestment-in-birmingham-and-the-west-midlands-to-deliver-2022-commonwealth-games/> [Accessed 6
August 2019]
53 "The Multiplier - Multiplier Effect | Economics Online", Economicsonline.Co.Uk, 2019
<https://www.economicsonline.co.uk/Managing_the_economy/The_multiplier_effect.html> [Accessed 6
August 2019]
54 Miller, Alex, "2018 Commonwealth Games Takes Schedule And Budget Golds | ACCA
Global", Accaglobal.Com, 2018 <https://www.accaglobal.com/gb/en/member/member/accountingbusiness/2018/04/insights/commonwealth-games.html> [Accessed 6 August 2019]
55 2022, Birmingham, "£778M Investment In Birmingham And The West Midlands To Deliver 2022
Commonwealth Games - B2022", B2022,
2019 <https://www.birmingham2022.com/news/blog/778m-
investment-in-birmingham-and-the-west-midlands-to-deliver-2022-commonwealth-games/> [Accessed 6
August 2019]
56
"Glasgow 2014 Commonwealth Games Legacy: Final Evaluation Report April 2018 - Gov.Scot", Gov.Scot,
2019 <https://www.gov.scot/publications/glasgow-2014-commonwealth-games-legacy-final-evaluation-reportapril-2018/pages/4/> [Accessed 6 August 2019]
57 ibid
58 "Olympics Boost To UK 'Nearing £10Bn'", BBC News, 2013 <https://www.bbc.co.uk/news/uk-23370270>
[Accessed 6 August 2019]
19
Fig.8 Birmingham’s local economy following the Games
Price level
SRAS
Outward shift of AD curve
following £778mn government
investment => increased GDP
AD1
Y1
Y2
AD2
Real GDP
These examples show hosting a major sporting event generates positive net returns.
Birmingham’s £778mn investment will likely result in a multiplied boost to its economy. Its
GDP will increase from Y1 to Y2 as shown in Figure 8, so we can infer that deprivation will
fall in areas like Lozells and East Handsworth, where 54% of children live in poverty59. The
Alexander Stadium, located in Perry Barr, is to have £70mn spent on upgrades so that it
becomes the “home of British Athletics60”. It is situated adjacent to Lozells and East
Handsworth (Figure 9) and will attract local investment, boosting the economy and reducing
deprivation. The link between deprivation and fast-food outlets61 suggests this will make the
59
Walker, Jonathan, "The Places In Birmingham Where More Than Half Of Children Are In
Poverty", Birminghammail, 2018 <https://www.birminghammail.co.uk/news/midlands-news/here-placesbirmingham-more-half-14197578> [Accessed 7 August 2019]
60 Mackay, Duncan, "Birmingham Targets Taking Athletics Off London As £70 Million Alexander Stadium
Redevelopment Plan For 2022 Commonwealth Games Unveiled", Insidethegames.Biz, 2019
<https://www.insidethegames.biz/articles/1080988/birmingham-targets-taking-athletics-off-london-as-72million-alexander-stadium-redevelopment-plan-for-2022-commonwealth-games-unveiled> [Accessed 7
August 2019]
61 England, Public Health, "Health Matters: Obesity And The Food Environment", GOV.UK, 2017
<https://www.gov.uk/government/publications/health-matters-obesity-and-the-food-environment/healthmatters-obesity-and-the-food-environment--2> [Accessed 30 May 2019]
20
area healthier by decreasing the number of fast-food outlets, as well as increasing sports
participation with new facilities, causing a fall in the number of overweight children. The
regeneration of facilities will reduce the extent of deprivation found in specific areas,
decreasing unemployment and the prevalence of obesity.
Fig. 9 Map of North Birmingham
https://wikimapia.org/23486057/Perry-Barr
Employment
The jobs created by Birmingham 2022 should lower the unemployment rate whilst
incentivizing businesses to invest with its newly-trained workforce and tourist popularity. As
mentioned, a predicted 4300 jobs a year are to be created62. The majority of work will also
be done by local businesses63, meaning that leakages are reduced – as opposed to work
being done by foreign companies – and that additional jobs are created in the build-up. 84%
of contracts were given to local businesses in the Gold Coast and 76% in Glasgow 64, whilst
more than 1000 jobs were created in Glasgow a year65 and a reported 35,000 were created
62
2022, Birmingham, "£778M Investment In Birmingham And The West Midlands To Deliver 2022
Commonwealth Games - B2022", B2022, 2019 <https://www.birmingham2022.com/news/blog/778minvestment-in-birmingham-and-the-west-midlands-to-deliver-2022-commonwealth-games/> [Accessed 6
August 2019]
63 ibid
64 ibid
65 "Glasgow 2014 Games 'Worth £740M'", BBC News, 2019 <https://www.bbc.co.uk/news/uk-scotlandglasgow-west-33626350> [Accessed 6 August 2019]
21
in Australia by the Gold Coast66 Games. We can therefore infer that it highly likely that
Birmingham will achieve its objective in creating employment.
The skill deficit in Birmingham has been highlighted, and 12500 volunteers are to be trained
for the Games67. The Gold Coast saw a huge success in its volunteer programme, with
47,000 applications for 15,000 positions68 demonstrating its scale of community
engagement. The accepted volunteers underwent 360,000 hours of training in total 69,
increasing their skill level. Whilst this may not bridge the gap between Birmingham and the
rest of the country in terms of actual qualifications, it will certainly leave its workforce more
desirable than before.
Long-term growth
Immediate economic benefits have already been detailed. However, Birmingham will
benefit further via tourism and infrastructure upgrades. Over 1 million spectators will travel
to Birmingham in 202270, and previous events experienced large tourism benefits. London
experienced £600mn net growth to its visitor economy following the 2012 Olympics71, and
66
"Gold Coast 2018 Commonwealth Games Created More Than 35,000 Roles", Company, 2018
<https://www.seek.com.au/about/news/gold-coast-2018-commonwealth-games-created-more-than-35000roles> [Accessed 6 August 2019]
67 Elkes, Neil, "How Many Jobs Will 2022 Commonwealth Games In Birmingham Create", Birminghammail,
2019 <https://www.birminghammail.co.uk/news/midlands-news/jobs-commonwealth-games-birminghammoney-14012749> [Accessed 27 May 2019]
68 Palaszczuk, Annastacia, "GC2018 ‘Volsrush’ As More Than 47,000 Apply To
Volunteer", Statements.Qld.Gov.Au, 2017 <http://statements.qld.gov.au/Statement/2017/3/22/gc2018volsrush-as-more-than-47000-apply-to-volunteer> [Accessed 7 August 2019]
69 ibid
70 2022, Birmingham, "Business Opportunities At The Birmingham 2022 Commonwealth Games", B2022,
2019 <https://www.birmingham2022.com/business/> [Accessed 6 August 2019]
71
"Olympic Games Legacy Boosts Economy By Billions", GOV.UK, 2013
<https://www.gov.uk/government/news/olympic-games-legacy-boosts-economy-by-billions> [Accessed 7
August 2019]
22
the Gold Coast experienced a 30% increase in the number of tourists in 201872, with
$550mn additional revenue projected over the next nine years73 due to its promotion as a
tourist destination. Birmingham can expect its tourism industry to bloom, not just in 2022 but
for years to come.
The stadium upgrades made in London and Glasgow had long-lasting effects, with Fort
William upgrades in Scotland allowing them to host the Emirates Airlines Rugby 7s and UCI
Mountain Bike World Cup in 201474. These ‘knock-on’ events contributed £18.6mn to
Scotland’s economy in 2014 and will contribute a projected £27.5mn by 201975. Similarly,
London’s Olympic Stadium hosted Rugby World Cup 2015 matches and is now the home
ground of West Ham United76. Upgrades to facilities, such as the Alexander Stadium, have
long-lasting economic benefits on top of immediate revenue.
Birmingham’s upgrades to Metro and bus systems77 will improve its infrastructure,
supporting its long-term economic growth. Glasgow upgraded the M74 in 201478, improving
accessibility to Eastern Scotland and interconnectedness. With improved transport,
72
Johnson, Kevin, "Analysing Expenditure Impacts Of The 2018 Commonwealth Games", Medium, 2018
<https://blog.geografia.com.au/analysing-expenditure-impacts-of-the-2018-commonwealth-games7436d6e429a0> [Accessed 7 August 2019]
73 ibid
74 "Glasgow 2014 Commonwealth Games Legacy: Final Evaluation Report April 2018 - Gov.Scot", Gov.Scot,
2019 <https://www.gov.scot/publications/glasgow-2014-commonwealth-games-legacy-final-evaluation-reportapril-2018/pages/4/> [Accessed 6 August 2019]
75 ibid
76 Sport, Telegraph, "Olympic Stadium To Host Five Matches At 2015 Rugby World Cup As 13 (Mainly
Football) Venues Selected", Telegraph.Co.Uk, 2013
<https://www.telegraph.co.uk/sport/rugbyunion/international/england/10032673/Olympic-Stadium-to-host-fivematches-at-2015-Rugby-World-Cup-as-13-mainly-football-venues-selected.html> [Accessed 7 August 2019]
77 Hodson, Tom, "The Economic Impact Of The Commonwealth Games In Birmingham", Sevencapital, 2018
<https://sevencapital.com/birmingham-property-news/economic-impact-commonwealth-games-inbirmingham/> [Accessed 5 August 2019]
78 "Glasgow 2014 Commonwealth Games Legacy: Final Evaluation Report April 2018 - Gov.Scot", Gov.Scot,
2019 <https://www.gov.scot/publications/glasgow-2014-commonwealth-games-legacy-final-evaluation-reportapril-2018/pages/4/> [Accessed 6 August 2019]
23
residents all across Birmingham will be able to commute, creating economies of scale79 and
encouraging business investment.
Finally, the Gold Coast constructed homes for 2500 permanent residents at affordable
prices80, whilst London built 7000 new homes81, of which 35% were “affordable82.
Birmingham will benefit from the construction of 1400 new homes in Perry Barr “Athlete’s
Village”83. This will be beneficial as Perry Barr is close to Lozells and East Handsworth, one
of the top 10% deprived areas in England84, so its image regeneration will boost business
investment and accommodate residents at affordable prices. As Perry Barr is being
regenerated, this will narrow the socioeconomic disparity between the inner city and
suburban areas of Birmingham. Economic growth will be more consistent across the city
and benefit residents from all backgrounds.
Conclusion
Birmingham expects the 2022 Commonwealth Games to act as a solution to its health and
unemployment issues. Data from previous events shows it is likely Birmingham’s economic
worries will be addressed; London, Melbourne and Glasgow all saw substantial boosts to
their economies, exceeding the initial injection for all three and reducing unemployment
79
"Economies Of Scale | Business | Tutor2u", Tutor2u, 2019
<https://www.tutor2u.net/business/reference/economies-of-scale> [Accessed 7 August 2019]
80 "WHAT WILL HAPPEN TO THE COMMONWEALTH GAMES VILLAGE", Mcgees Property Brisbane, 2019
<https://www.bne.mcgees.com.au/resources/blog.php?id=962> [Accessed 7 August 2019]
81 Robertson, Hugh, "London 2012 Construction's £7.3 Billion Impact On UK Economy", GOV.UK, 2012
<https://www.gov.uk/government/news/london-2012-constructions-7-3-billion-impact-on-uk-economy>
[Accessed 6 August 2019]
82 ibid
83 Hook, Richard, "1,400 New Homes Proposed In Birmingham Commonwealth Games Plans", Property
Week, 2018 <https://www.propertyweek.com/news/1400-new-homes-proposed-in-birminghamcommonwealth-games-plans/5098284.article> [Accessed 7 August 2019]
84 "Handsworth", Birmingham.Ac.Uk, 2019 <https://www.birmingham.ac.uk/generic/upweb/partnercountries/united-kingdom/handsworth-area.aspx> [Accessed 7 August 2019]
24
given the increase in labour and resources needed to produce more output. Thus, the
Games are likely to address Birmingham’s unemployment situation in the short-run.
Furthermore, there will be long-term economic benefits from the infrastructure and facility
upgrades, with upgrades to the Alexander Stadium equipping Birmingham to host future
events and the metro system increasing citywide interconnectedness.
However, the Games will not address Birmingham’s qualification deficit; the volunteer
training will increase the skill-level, but tertiary-sector employers will be looking for a pool of
well-qualified graduates to invest around, which Birmingham currently lacks. Whilst firms
may invest in the area following the tourism boom, in the long-run they may invest
somewhere with a better-qualified and more productive workforce. For Birmingham to have
sustained economic growth, its qualifications deficit will need to be addressed to incentivize
firms to locate there permanently, otherwise it risks firms relocating once the immediate
boom settles.
The games are unlikely to address Birmingham’s health crisis. London and Glasgow failed
to achieve an Active Legacy, which Birmingham intends to create, and saw no substantial
physical activity level increase. Research suggests unhealthy habits are passed down
generations and exposure to a global sporting event is not enough to alter lifestyles for the
better.
Activity levels may not be greatly affected but if deprivation is reduced, which is likely given
the regeneration of deprived areas like Lozells and East Handsworth, people may eat
healthier food given the positive correlation between deprivation index and number of fast
food outlets in an area. Given the high-caloric nature of fast-food, this will hamper the rate
25
at which the obesity epidemic develops, but for the issue to be tackled completely, more will
need to be done to address physical inactivity.
The 2022 Commonwealth Games will benefit Birmingham’s economy, yet to address
unemployment in the long-run more will need to be done to address the qualification deficit.
The Games are unlikely to tackle the obesity issue and a different approach will be required
to inspire physical activity uptake.
26
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