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The Economic Impact of Physical Activity

Key Message

Based on estimates from the 1995 Physical Activity Monitor, current expenditures on fitness equipment and clothing contributed $10.8 billion to the economy. Including all participation-related expenditures, the amount of economic activity doubles to almost $21.5 billion. This represents a significant contribution to the Canadian economy, over and above the obvious health care savings brought about by an active population.”

Source

Canadian Fitness and Lifestyle Research Institute. (1997). The Economic Impact of Physical Activity. Ottawa, Ontario: Canadian Parks and Recreation Association.

Purpose

Over the years, economists have found physical fitness has a positive impact on the economy in terms of discounted lifetime costs, annual direct health care costs, productivity due to reduced absenteeism, and capacity for independent living among older adults. There are two significant economic benefits from physical activity - its contribution to health care savings and its effect on the economy.

Health care savings
Health Canada’s estimate of the direct cost of treating illness consists of four components: hospitals, physicians, drugs, and research. In 1993, these costs added up to $2.3 billion for ischemic heart disease, $572 million for diabetes type 11 and $255 million for colon cancer. In the same year, ischemic heart disease accounted for 21.8 per cent of deaths in Canada, diabetes-types 1 and II combined was responsible for 2.4 per cent and colon cancer accounted for 2.2 per cent.

Research has shown less active individuals are 1.6 times more likely to contract ischemic heart disease than active individuals. Also, less active individuals are 1.2 times more likely to develop type II diabetes and colon cancer. A study, commissioned by the Canadian Fitness and Lifestyle Research Institute, examined the impact on annual health care costs of a one-percentage-point increase in the number of physically active Canadians. This assumption is not unreasonable, given that between 1981 and 1995, the proportion of physically active Canadians increased by about one percentage point every year.

A one-percentage-point increase could potentially save $10.2 million from ischemic heart disease, $877,000 from diabetes type II and $407,000 from colon cancer each year (all figures in 1993 constant dollars).

Evidence

Overall, men spend over twice as much as women to be active - $986 compared with $409. This difference is generally due to equipment and membership fees, particularly among older adults. Canadians living in larger communities spend almost twice as much to be active ($937 annually) than do those in smaller communities ($455 annually). They spend over one and a half times more on transportation, more than double on clothing, and over three times more on membership and user fees.

Overall, expenditures related to boys’ participation are greater than expenditures for girls. The largest expenditures on children’s participation occur in the smallest communities (less than 1000 residents), where parents spend about $1,072 on their child’s physical activity. Whereas adults in larger communities spend more to be active, the reverse is true for children.

Activity level
There is a clear relationship between activity level and amount spent on participation. Adults who have a regular pattern of participation - active on average at least every other day - spend more to participate than those who are active at least twice weekly, who in turn spend more than those who are active less often.

Higher expenditures are associated with higher activity levels among children. The physical activity level of children is significantly correlated with the amount spent to support their participation.

Based on estimates from the 1995 Physical Activity Monitor, current expenditures on fitness equipment and clothing contributed $10.8 billion to the economy. Including all participation-related expenditures, the amount of economic activity doubles to almost $21.5 billion. This represents a significant contribution to the Canadian economy, over and above the obvious health care savings brought about by an active population. Findings from the Physical Activity Monitor are published in Progress in Prevention - a resource of the Canadian Fitness and Lifestyle Research Institute, a national research agency concerned with advising, educating, and informing Canadians and professionals about the importance of healthy, active lifestyle. To find out more about Progress in Prevention, see page 25.

Additional Information

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Benefit Statements / Outcomes

Leadership Provided By:

  • Leisure Information Network (LIN)
  • Alberta Recreation and Parks Association

On Behalf Of:

  • Canadian Parks and Recreation Association (CPRAA)

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