Experts discuss the effects of ‘fun-flation’ leading to skyrocketing concert ticket prices
SPRINGFIELD, Mass. (WGGB/WSHM) - Just like everything in today’s world, concert ticket prices have sky-rocketed, some well over a $1,000. But, spending more to see your favorite artists comes with a silver-lining.
Six months ago, the Federal Reserve was bracing for a recession. Interest rates went up to curb spending because of it.
But, there was one interest rate the fed didn’t account for. The interest rate of live entertainment, concerts. Sports, movies, and people’s willingness to spend on them.
“I think what’s got people a little surprised is how much they’re willing to pay for Taylor Swift and some of these other big events,” said John Rogers. “Its kind of a global phenomenon.”
American International College professor of economics, John Rogers, explained how consumers are able to foot that bill.
“I think it’s this persistently strong job market that then fuels everything else because people have jobs, they’re willing to spend,” explained Rogers. “Then they’re willing to spend that creates more jobs and so it’s a sort of virtuous circle”
Unemployment skyrocketed to 14.4% in April of 2020, an immediate response to the onset of the COVID-19 pandemic.
Since, the gradual decline has brought us back to pre-pandemic levels, with October of 2023 clocking in at 3.9%.
“The phenomenon we have now is that we do still have inflation, but the job market and the economy is booming,” noted Rogers. “The economy grew by 4.9% Last quarter which is huge, almost unheard of and most of that was consumer spending. So it’s a bit of a paradox.”
AIC student Drue Fleck told Western Mass News he spent his fair share on entertainment this year.
“This summer I went to a lot of concerts,” said Fleck. “I went to Post Malone, I saw Jason Aldean, I also saw Luke Combs…”
2023 was dubbed the “Year of the Concert” by many.
According to Forbes, the top five grossing tours were Taylor Swift’s Eras Tour, Beyonce’s Renaissance World Tour, Ed Sheeran’s Mathematics Tour, Coldplay’s Music of the Spheres and Pink’s Summer Carnival.
For Fleck, his concerts were worth every penny.
“Obviously you look at the ticket prices and you think ‘that’s a lot of money’ but in the end, I think people do it because it’s worth the experience,” expressed Fleck.
Experiences that a lot of people missed out on while COVID-19 spread across the world, effectively shutting down entertainment options.
“We’ve definitely seen an influx of people in the post-pandemic world,” added Chris Hayes. “Essentially consumers over-consumed on entertainment at their home, so now they’re looking to get out of the digital world and get out into the live entertainment.”
Chris Hayes and his team at Oak View Group have seen the entertainment boom firsthand at MassMutual Center.
“Some of the stats that I’ve found, pre-pandemic and post-pandemic, we’ve done about a 51% increase in people’s willingness to splurge on themselves, which I thought was very interesting,” explained Hayes. “We saw a 84% increase in the consumption of entertainment in the pandemic”
It could be a long time until that slows down.
“I don’t we should get carried away, but as long as its rolling, people have the jobs and have a little bit of extra money, I think this mega-event phenomenon, fun-flation or whatever you want to call it… I think you’ll see that persisting,” noted Rogers.
Although optimistic, Rogers points to student debt payments, interest rates and the possible geo-political conflict stemming from the Israel and Hamas war as possible black clouds.
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