Beyoncé Renaissance & Taylor Swift Eras Tours Plus Barbenheimer Movies to Inject $8.5 Billion into US Economy in Q3 2023

Summer sensations Beyoncé, Taylor Swift, and the Barbenheimer phenomenon have significantly energized US economic activity, but this surge is expected to be temporary.

According to Morgan Stanley's latest analysis, the combined economic impact of Beyoncé's Renaissance Tour, Taylor Swift's Eras Tour, and the blockbuster movies Barbie and Oppenheimer is forecasted to add approximately $8.5 billion to the US economy in the third quarter of 2023. Notably, the concert tours account for nearly two-thirds of this impressive figure. However, as these tours conclude and federal student loan repayments resume, consumer spending is anticipated to decline in the following quarter.

Highlights

• The $8.5 billion boost in Q3 2023 is primarily driven by Beyoncé and Taylor Swift’s tours along with the blockbuster films Barbie and Oppenheimer.
• Beyoncé and Swift’s tours contribute about 66% of the total economic impact.
• These entertainment events added 0.7 percentage points to US consumer spending growth and 0.6 percentage points to GDP growth in Q3.
• Consumer spending is expected to soften in Q4 as tours end and student loan payments restart.

Morgan Stanley’s report highlights that the surge in spending from these cultural phenomena fueled a 1.9% year-over-year increase in US consumer spending during Q3 2023. The entertainment-driven boost accounted for a significant portion of personal consumption expenditures (PCE) and overall GDP growth. July alone saw consumer spending rise by 0.8%, marking the fastest growth since January, according to the Bureau of Economic Analysis.

Economic Powerhouses: Beyoncé, Swift, and Barbenheimer

Media analysts estimate that Barbie and Oppenheimer combined generated around $2.3 billion from ticket sales and concessions, with international sales potentially adding another $1 billion. Concert attendees on Beyoncé’s Renaissance Tour in the US spend an average of $1,800 per person on tickets, travel, accommodation, and food, while Taylor Swift’s Eras Tour fans spend about $1,500 each. Together, these tours are projected to drive $5.4 billion in economic activity during Q3.

Looking Ahead: Spending Set to Decline as Tours End and Loans Resume

Despite this summer’s economic boost, Morgan Stanley cautions that the spike in spending is temporary. With Taylor Swift’s US tour dates ending in August and Beyoncé’s Renaissance Tour concluding in late September, consumer spending is expected to drop by an estimated 0.6 percentage points in Q4.

Additionally, the resumption of federal student loan payments starting October 1 will likely curtail discretionary spending further. Approximately 26.6 million borrowers, each carrying an average debt of $41,000, will begin repayments after a three-year pause. This is projected to reduce consumer spending by an additional 0.8 percentage points.

Nearly half of student loan borrowers are expected to restart payments in Q4 2023. Although the Biden Administration’s 12-month grace period may soften the immediate impact, reduced consumer expenditure is anticipated to continue into early 2024, when another 20% of borrowers will resume payments.

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