Revenue / 12.21.21

Converging Freakonomics: Why Live's 'Great Return' Faces a Slew of Economic Challenges

Access Staff

Pollstar (12/17/21) Gensler, Andy

For live events to rebound in 2021, the industry must run a gauntlet of economic challenges that include inflation, labor shortages, supply chain disruptions, increased insurance rates and congestion. Inflation is the biggest likely challenge, with one industry veteran expecting tour bus rental prices to top $800 a day by summer. Higginbotham managing director Paul Bassman sees insurance rates climbing as well, because "if inflation is making prices rise and making everything more expensive, they're going to raise rates accordingly to at least match the rate of inflation." RZO founder Bill Zysblat, meanwhile, envisions tour costs increasing next year, as well as ticket prices. Labor shortages are another challenge, with tour manager Bill Reeves saying this will create pain points especially in "places that are right to work or don't have a strong union." However, he also believes such shortages will soon start leveling off, "because people living on unemployment and stimulus checks, etc., will eventually have to go back to work." COVID mitigation measures will likely inflate tour expenses, with many industry veterans expecting some of the extra cost to be added to ticket prices, possibly affecting attendance. Results could include lower artist guarantees and reduced commissions to promoters, managers and agents, and perhaps lower venue rates.

Read the full story from Pollstar. 

Tags: News , COVID-19 , Coronavirus , Revenue