The City of Entertainment: How Film-Shoots and Summer Festivals Boost Chicago's Economy

How the Film Industry Transforms Chicago

Chicago has been thrust into the cinematic spotlight once again as the cast and crew of Transformers 3 spend the summer filming downtown. Since mid-July, locations

across the city have hosted explosions, celebrities, and a crowd of onlookers eager to see them both. Projects like Transformers draw thousands of tourists (and locals alike), creating significant economic benefits for local businesses, and furthering Chicago’s cultural relevance and cachet.

The street closures, explosions, and overturned cars surrounding a film production can overshadow the economic impacts, but Transformers alone has generated more than $20 million and 1,200 jobs, according to city estimates. Listings on the Chicago Film Office’s website show roughly 200 major movies have been filmed in Chicago since 1960 – of those projects, nearly three quarters were completed after 1989. In that same period, more than 900 total film and television projects contributed more than $1.65 billion to the local economy and provided more than 275,000 local jobs, according to the city.

On August 25, Mayor Richard M. Daley formally thanked the Transformers crew for the positive attention it has brought downtown, and praised high-profile film projects for their economic development potential.

“Through this opportunity and others like it, we have been able to find creative ways to boost our economy amidst the worst recession in 70 years,” Daley said. “We view the film and TV production industry as a growing component of our economic development strategy for the future of Chicago, because movies and TV shows made here showcase our city to the world, create excitement and provide jobs for our residents.”

In addition to Transformers, a number of television pilots were filmed in Chicago this year. One of these, Ride Along, has been picked up for subsequent episodes, all of which will be filmed in Chicago. According to Mayor Daley, this means employment for 200 local technicians and actors and an economic impact of $40-50 million per season.

“One of the reasons that Chicago is so attractive to producers is that it provides them with a variety of settings, both modern and historical. Chicago is also home to many talented actors and actresses, so filmmakers know that they can hire talent right here– saving money without sacrificing quality,” Daley said.

The Economics of Summer in Chicago

To locals, summer in Chicago is a time to reconnect with the city’s outdoor amenities and activities. To many visitors, it is a surprise: the 29 beaches, the abundant sunshine, and hundreds of cultural and recreational events that provide a major source of entertainment and a boost to local businesses.

Generally, tourism and recreation represent a substantial share of Chicago’s economy, and the numbers are trending upward. Between 1998 and 2008, Chicago’s annual travel volume increased by nearly a third, or 10 million people, according to data from the Chicago Convention and Tourism Bureau (CCTB). Of the 45.6 million people who traveled to Chicago in 2008, 32.4 million were domestic leisure travelers, according to the data. More people visiting the city means more money is injected into the regional economy.

 "Tourism's economic impact is vital for Chicago's local business community,” said Dorothy Coyle, Director, Chicago Office of Tourism. "In 2008, the city’s one-of-a-kind attractions, world-class cultural institutions and stunning lakefront drew 45 million domestic and international visitors who spent $11.8 billion, generating about $656 million in tax revenue for the city and the state and contributing to 132,000 local jobs.”

Local tourism especially thrives in the summer. Major events like the Taste of Chicago, the Chicago Air and Water Show, the Bud Billiken Parade, and the Chicago Blues Festival attract people from all over the region and the world. Additionally, the Mayor’s Office of Special Events (MOSE) works with community groups and local businesses to organize more than 400 neighborhood festivals throughout the summer. The city estimates that 2.7 million people converged in Grant Park for this year’s Taste of Chicago, which is spread across 10 days and perennially posts the largest attendance among summer events. The Air and Water Show, a two-day event, typically attracts 1 million people per day, according to MOSE.

Aside from a good time, these events translate into significant revenues for a host of local industries. "The free events and festivals produced by our office are one of the reasons Chicago is such a great place to live and to visit,” said Cindy Gatziolis, a spokeswoman for MOSE.  “And it is such a boon to tourism in the city because you have people taking taxis, parking in garages, going to lunch or dinner at one of our wonderful restaurants, visiting our cultural institutions and staying in hotels so they can come right back and enjoy free music performances or the delicious Taste of Chicago." Between 2007 and 2008, The Taste generated more than $80 million for local businesses, according to city estimates. The Chicago Blues Festival, which tends to attract a larger share of international tourists, had an economic impact of $35 million over the same period.

Each year, citywide hotel occupancy nearly doubles in the summer months. While rooms tend to be 35-to-50-percent occupied in winter, this figure jumps to the mid-80s in the summer, according to CCTB data. In June 2010, the last month for which data are available, Chicago hotels were 86.7 percent occupied with an average daily rate of $204.58.

Summer may be Chicago’s best kept secret, but the word is getting out. And increasingly, the City by the Lake is benefiting from the economy by the beach.

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Images:
Taste of Chicago - CC by eszter from Flickr.
Transformers 3 Shooting - CC by Michael Kappel from Flickr.