12102015 Specious In Seattle shy Forbes

httpwwwforbescom20080625seattleshysupersonicsshynbashybizshysportsshycx_mw_0625seattlehtml 14

FREE Webcast 8 Billionaire Predictions for 2016 Help|Connect|Sign up|Log in

6252008 235PM

Specious In SeattleThe city of Seattle is in federal court trying to keep new team owner ClayBennett from moving the SuperSonics basketball team to Oklahoma City Inthe ongoing trial the city has called witnesses ranging from economists tosuperfans to talk about the financial and emotional impact of the Sonicsleaving Seattle

Pity for the fans that Seattlersquos based so much of its case on the dubious mathof economist Lon S Hatamiyandashformer California secretary of trade andcommerce under Gray Davis

At the heart of Hatamiyarsquos claimsndashand the case against movingndashis that theSonics support 1200 to 1300 jobs in Seattle and are responsible for $188million in local economic activity This looms large both in the current trialand in future litigation that would determine damages to the city should theteam leave The city claims the Sonics have to honor the two remaining yearsof their lease because Seattle paid $74 million in renovations to the arena overthe last 10 years

But when you dig into the numbers you see Hatamiyarsquos tossed an air ballLetrsquos start with the jobs claim An NBA season has only 41 home games Theaverage basketball game lasts two and a half hours so including time thearena is open before during and after the game thatrsquos seven hours per gameEven if an usher hot dog vendor or ticket seller worked every gamendashwhich isuncommonndashit comes out to only seven full workweeks a year

Based on research from University of Washington professor William Beyersand GMA Research a Bellevue Wash marketing firm KeyArena businessesdirectly employ 385 partshytime workers who would lose seven weeksrsquo salaryover the course of a year Given that Seattlersquos metro area unemployment is37 according to the US Bureau of Labor Statistics flat from a 37 markat this time in 2007 itrsquos highly likely that those 385 people will be able to findseven weeks of work should the Sonics leave

That leaves 206 fullshytime KeyArena employees who would be affected by theSonics leaving assuming that KeyArena doesnrsquot book more concerts eventsor alternate sports during the 41 days they lose as the result of a Sonics moveFor the 206 fullshytime employees to all lose their jobs because of a Sonicsmove KeyArena would have to completely shut down

As a barometer of scale and economic impact the average WalshyMart store

2 016 ATS SED AN

FEA TURES amp SPEC SVIEW PHOTOSBUILD YOUR OWN

RADIANT SILVER METALLIC

ADDITIONAL DETAIL S

Matt Woolsey0

Tw eet

0

0

0

0

New Posts+7 posts th is hou r

Most PopularForbes Inv estm ent Gu ide

ListsTopshyPa id Musicians

VideoDown With Debt

12102015 Specious In Seattle shy Forbes

httpwwwforbescom20080625seattleshysupersonicsshynbashybizshysportsshycx_mw_0625seattlehtml 24

Tw eet 0

Comments are turned off for this post

See Also

Request for Leave of Absence

Flexible Work Jobs

Sonic Router

Top 10 Sports Colleges

Sport Management Careers

Sports Industry Careers

Sports Apparel Brands

Fantasy Football Games

employs 350 people and the partshytime employees work 20shyhour weeks yearround

To get to 1200 or 1300 jobs Hatamiya who declined to comment for thisarticle has to count every person who sold a bottle of water to a Sonics fanduring a game or a beer to a fan after a game and even then yoursquore just talkingabout a few hours a weekndashhardly the difference between an existing ornonexisting job There can be no doubt that if the Sonics leave bars andrestaurants around KeyArena will suffer on the 41 nights the Sonics wouldhave played in their neighborhood but itrsquos hard to see how the city stands tolose $188 million as Hatamiya claims

The existence of the Sonics does not change disposable family income inSeattle Residents of the city and the surrounding suburbs will still havemoney to spend They might spend it on groceries or a Seattle Mariners gameon a new suit or a few more movies a year Seattle residents will spend thesame amount of money with or without the Sonics itrsquoll just be in differentparts of town

The theory of disposable income as a zero sum game with regards to sportshas been proved empirically again and again in peershyreviewed economicstudiesndashmost notably by Andrew Zimbalist an economist at Smith Collegeand Roger Noll an economist at Stanford

Close to 650000 Sonics fans attended games last year The only question iswhether the minority of them who came from outside Seattle and indeedoutside of King Countyndashwhich includes more than 50 suburbsndashwill decide tostop spending their cash on businesses and entertainment in Seattle or KingCounty because their basketball team left

Thatrsquos a tough slog and it hasnrsquot been proved true in any American city Itrsquod betragic for sports for the Sonics to leave their loyal fan base but therersquos noeconomic argument to keep them

Of course the joke is really on Oklahoma City While Bennettrsquos economistBrad Humphreys from the University of Alberta argued down the Zimbalistand Noll line that a team doesnrsquot add jobs or have a significant economicimpact Bennett convinced Oklahoma City to drop $120 million in publicmoney on an arena The rationale You guessed it economic impact As far ascorporate welfare goes thatrsquos not a bad trick

Report Corrections Reprints amp Permissions

0 0 0 0

12102015 Specious In Seattle shy Forbes

httpwwwforbescom20080625seattleshysupersonicsshynbashybizshysportsshycx_mw_0625seattlehtml 34

Inside Forbes

Top Cell Phone Plans

know more

Flexible RetirementAnnuities

know more

Lose Weight Quickly

know more

Mini DentalImplants

know more

Best Health Plans forSeniors

know more

Invest in MutualFunds

know more

Do not miss

12102015 Specious In Seattle shy Forbes

httpwwwforbescom20080625seattleshysupersonicsshynbashybizshysportsshycx_mw_0625seattlehtml 44

Conferences2015 Forbes 400 Summit onPhilanthropy

2015 Forbes Womenrsquos Summit

2015 Forbes Asia The NextTycoons

2015 Forbes ReinventingAmerica The AgTech Summit

2015 Forbes Under 30 Summit

2015 Forbes Global CEOConference

2015 Forbes CMO Summit

2015 Forbes Healthcare Summit

2016 Forbes CIO Summit

EducationForbes School of Businessat Ashford University

NewslettersForbes Investor

Special Situation Survey

Forbes Div idend Investor

Forbes Premium IncomeReport

Investing Newsletters

ProductsForbes eBooks

Forbes Newsfeeds

Reprints amp Permissions

Forbes Magazine

The Smarter College Guide

Forbesfone Travel SIM

Forbes Custom

Company InfoAdvertise

Forbes Press Room

Forbes Careers

Contact Us

Sitemap

Help

Forbes Brazil

Forbes China

Forbes Croatia

Forbes Czech

Forbes India

Forbes Israel

Forbes Japan

ForbesKazakhstan

Forbes Mexico

Forbes MiddleEast

Forbes Poland

Forbes Romania

Forbes Russia

Forbes Spain

Forbes Thailand

Forbes Vietnam

2 Free Issues Subscriber Services Gift Subscription

2015 Forbescom LLCtrade All Rights Reserved Terms and Conditions Privacy Statement Market Data by Morningstar AdChoices

BUSINESS INVESTING TECHNOLOGY ENTREPRENEURS OPED LEADERSHIP LIFESTYLE LISTS

Advice on stocks bonds retirement taxes and real estateyou can act on today

FORBES Investment GuideThe Future Of Your Money

How Movie AdaptationsImproved Book Sales

The HighestshyPaid TVPersonalities 2015

The Biggest CEODepartures Of 2015

RealshyTime Billionaires