The acute effects of the COVID-19 pandemic on the sports sector in Finland
The impact of the COVID-19 pandemic and ensuing corona restrictions appears to vary among sports operators in Finland, but there do not appear to be any winners in this crisis in the sports sector. Sports companies that have experienced the most acute and severe repercussions from COVID-19 are those whose activities have been impacted by the corona restrictions. Many of them have completely discontinued their activities. Turnover has dropped by at least half in 59% of sports companies. In many respects, sports companies appear to be suffering more on average than companies overall.
The COVID-19 pandemic has also had an impact on sports operators that are funded through tax revenue, gambling proceeds or other income (e.g. membership fees), such as municipal sports services, training and research organisations, sports clubs and sports organisations. Rapid adjustment measures have generally helped to overcome the financial challenges that arose during the acute phase of the COVID-19 crisis. The most significant effects of COVID-19 on the these actors will be seen later, for example as tax revenue and gambling proceeds decrease, or if new restrictions hamper activities and revenue acquisition in the autumn.
The main sports and fitness services in the municipalities were largely discontinued or closed in spring 2020 (excluding outdoors and nature facilities). The revenue losses caused by COVID-19 restrictions (from March to May 2020) in the sports services of the municipalities of mainland Finland was estimated to amount to a total of EUR 22-23 million (net losses cannot be estimated). It is likely that the most significant repercussions of COVID-19 on municipal sports services will be seen only later along with a general deterioration in local government finances.
Most (80%) association-based sports clubs survived the spring 2020 restrictions with relatively few problems. However, one fifth of all clubs faced many or very significant problems. Common denominators in these clubs included high fixed costs, a fast drop in revenues and the lack of financial buffers. The revenue losses of the clubs (March-May 2020) was estimated at EUR 76 million (net losses of EUR 47 million). In sports federations and other sports organisations, the corona crisis had a major impact on elite sports, sports events, shows, camps and competition activities. The biggest impact on the finances of the organisations will probably not be seen until autumn 2020. Revenue losses in the organisations was estimated to be 11,4 million (net losses 2.1 million) between March and May.
In the case of training and research organisations, the COVID-19 restrictions have had the greatest impact on sports training centres (sports institutes), where the restrictions made liberal education training, the activities of sports academies and coaching centres and other service activities significantly more difficult. The restrictions brought customer flows in the centres to an almost complete standstill, which forced them to make many adjustment measures. In general, COVID-19 impacted the activities and finances of other training and research organisations in the sports sector only to some extent. Due to the restrictions, the sports sector has carried out its educational and training activities remotely and by using online learning environments.
The COVID-19 restrictions have had a significant impact on the development of digital services and remote services for sports operators. In June 2020, it is still be impossible to assess the overall effects of the COVID-19 crisis comprehensively. The final effects depend on the duration of the crisis. If there is a second wave of COVID-19 and new restrictions in autumn 2020, a large number of sports operators will end up in significant difficulties.
This is a summary of report “The Acute effects of the COVID-19 pandemic on the sports sector in Finland” (National Sports Council 17.6.2020). The report describes the situation of municipal sports services, sports clubs, sports organisations, sports companies as well as training and research organisations between March and May 2020. The data for the survey are based on a questionnaire sent to sports operators in early May. The report is only available on Finnish: Koronapandemian akuutit vaikutukset liikuntatoimialaan.