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ECONOMIC IMPACT

Arizona Golf Industry:  $6 billion economic impact, 2% water use

In 2021, Arizona’s golf industry produced an estimated $6 billion in economic activity while only using 2% of daily statewide water to serve 16.6 million golf rounds. This economic output supported nearly 66,200 jobs, provided $2.3 billion in wages and generated $518 million in state and local tax revenues.

Study of Golf’s Economic and Environmental Impact

These and other finding were uncovered by an Arizona golf industry study released in January 2023 conducted by Rounds Consulting Group, in partnership with the Arizona Alliance for Golf. Titled “The Economic Contribution of Arizona’s Golf Industry,” the study gathered and quantified the economic and environmental impacts directly and indirectly influenced by golf in Arizona during 2021.

Key Findings:

  • $6 billion in economic activity was produced in 2021 by the golf industry
  • 66,200 jobs were supported, including golf course and golf-related businesses.
  • $2,283,332,500 in total wages earned.
  • $518 million in tax revenue was generated
  • 2% of daily water use statewide
  • Positively affects residential real estate values
  • Drives millions of charitable fundraising dollars
  • Junior golf promotes physical and mental health and life-skills development.
  • Tree cover and green spaces mitigates urban heat island effect.

Low Water Usage

  • 2%: Golf course irrigation accounts for 2% of daily water use statewide.
  • 5%: Crop irrigation was the largest at 73.5% of total daily withdrawals.
  • 7%: Public supply accounted for 20.7%.
  • 6%: Industrial/manufacturing came in at 2.6%.
  • 2%: Other use categories accounted for 1.2%.
  • These efforts include finding ways to utilize reclaimed wastewater by filtering it to meet quality standards (non-potable) and then recycling this water for irrigation.

Economic Driver

  • $6 billion in economic activity was produced in 2021 by the golf industry
  • 66,200 jobs were supported, including golf course and golf-related businesses.
  • $2,283,332,500 in total wages earned.
  • $518 million in tax revenue was generated

Socioeconomic Impacts

Arizona’s golf industry drives hundreds of millions of dollars in charitable fundraising for local non-profits such as Hospice of the Valley, Boys and Girls Clubs, and the Special Olympics, to name a few. The WM Phoenix Open, alone, raised $10 million for local Arizona charities in 2022. And since 2012, it has raised a jaw-dropping $110 million.

Youth golf programs provide opportunities for players and spectators to maintain their physical and mental health. The First Tee develops life skills that improve self-confidence and self-image, encourage problem solving, decision-making skill, and reinforces the importance of integrity, perseverance and sportsmanship. These skills are taught through golf-related exercises, empowering students to overcome the challenges they face off the course.

Golf provides physical exercise, requiring four hours of significant walking, even with golf cart. The physical exercise and social benefits of interacting with friends and family also provides proven mental health benefits.

Environmental Focus

The urban heat island effect is particularly severe in areas of extreme heat, leading to health and economic consequence. The Nature Conservancy estimates that without taking any measures in Maricopa County to mitigate the heat island effect, the rising temperatures and increasing pollution will cost an estimated $1.9 billion annually by 2050. Enhancing tree canopy coverage and other vegetation is one of the most effective strategies to reduce the heat island effect. In fact, Maricopa County, City of Phoenix and City of Tempe are partnering with urban forestry groups to achieve 25% tree canopy coverage.

Urban Climate Research Center estimates that even a one-degree reduction in the average annual temperature would save Phoenix residents an estimated $15 million annually due to reduced demand on the electrical grid. Golf courses mitigate the heat island effect with abundant tree cover and green spaces. For example, the presence of the golf courses in Scottsdale helps save residents approximately $30 million in utility costs annually.

To achieve 25% tree canopy coverage throughout Maricopa’s urban areas, a total of 133,300 acres needs to be covered, likely with public/private funding. Existing golf courses effectively save future tree canopy programs an estimated $500 million in publicly funded installation and maintenance costs.

Tourism & Small Business Supporter

  • Tourism Supporter: 9% of Arizona visitors played golf in 2021.
  • Small Business Supporter: The golf industry supports dozens of local businesses, including retail, manufacturing, professional services and software development, among others.

Impacts on Property Values

Arizona’s residential real estate market benefited from the golf industry through higher property values and average sale prices. Price premium of all existing golf community homes in Arizona were $2.05 billion in 2006, $2.06 billion in 2014 and $2.24 billion in 2019. This represented $16.2 million in additional property tax revenues.

Golf course homes sell for 18 to 40 percent higher average prices, compared to homes in the immediate area. Furthermore, the golf industry is a critical element of residential home development in Arizona. It is likely that without golf, the development of residential communities in areas would have been hindered in terms of quantity and quality.

Other Findings

The report noted Arizona’s golf industry as showing strong growth, even during the pandemic, in rounds and popularity, hosting 16.6 million golf rounds in 2021, a 4% increase. It’s a healthy market, resistant to business cycle, with conservative saturation. Employment at Arizona’s golf courses and non-course facilities increased by 8.9% from 2019 to 2021, which exceeded the overall statewide employment growth rate during the same timeframe.