The Economics Behind Skiing: Why it’s a Dying Industry
In 2016, 20.23 million Americans went skiing. Within five years, this figure fell by over 2 million people, with only 18.11 million Americans skiing in 2021. With this massive drop, one has to wonder what is the cause of this decline. Before diving into this question, let’s look at the history of skiing.
Skiing has been around since the stone age, and archaeologists have found evidence of skis dating back to around 8000 to 7000 BCE. For generations, skiing was a growing sport, rising in popularity year after year. But suddenly, COVID hit, and our lives were turned upside down. Skeptics thought the same would happen to the ski industry since it is very much an in-person activity; however, they recorded a relatively good year, with 19.76 million Americans going skiing in 2020. With these consistent numbers, it seemed that the ski industry would remain relatively stable in the years to come. However, a new wave of issues suddenly sprang up that nobody expected. So what are these issues, and how are they affecting the ski industry?
First, skiing is undoubtedly getting more expensive, and recent inflation has not made this much better. Skiing prices are growing so much that they have exceeded inflation rates, which is the percentage rate of change in the price level over time. In 2006, a one-day lift ticket at Vail, one of the most famous ski resorts, cost roughly $85. Now, a one-day ticket at Vail costs a staggering $219. If skiing prices had risen at the same inflation rates, they would currently stand at $111. Additionally, skiing is a highly gear-heavy sport, and it could cost thousands to purchase the equipment and apparel you need, including skis, a jacket, boots, and more. All of these expenses are rising at absurd rates, and it looks like the prices won’t be decreasing anytime soon. In the economic world, there is a phenomenon known as the “Law of Supply and Demand.” It states that as prices increase, supply increases while demand drops, and as prices decrease, supply decreases but demand increases.
However, ski resorts cannot lower their prices without detrimentally affecting their business model, which leads me to my next point: While owning and maintaining ski resorts used to be a popular, lucrative activity, it is quickly becoming a much more expensive business. Owning a ski resort typically means you have the responsibility of maintaining the mountain, which is becoming increasingly difficult due to rapid global warming. Auden Schendler, senior vice president for sustainability at the Aspen Skiing Company, said, “I’ve always been concerned that warming would end the ski industry. It will.” The Colorado Rockies is an area where many of the most prestigious ski resorts are located, including Aspen, Beaver Creek, Park City, and many more. Since the 1980s, however, the Colorado Rockies have had a 3 degree temperature increase. Due to this, the ski season has lost almost a month of early snow, and ski resorts open closer every year to Christmas. This is earlier than they would like, but it is a must if they want to survive in the long term. And even with all this discouraging news, in comparison to other locations, Aspen and Vail are considered better scenarios since they are at such high altitudes. Ski resorts across the U.S. face much more detrimental impacts because they are at a much lower elevation. Altitude matters a lot for ski resorts because the higher your altitude, the colder it will be and the more snow you will get, so you can stay open for longer.
With all this in mind, is there any way to save this dying industry? The first step would be to lower costs. Government funding can help alleviate pressures on ski resorts and consumers so they don’t have to stress over how much money they spend during the winter season. Additionally, once prices are lowered, skiing would likely become a much more popular activity, allowing resorts to handle their costs more effectively while simultaneously providing an optimal experience for the customer. Second, we need to be more conscious of the environment. Not just for skiing but for the future of our world. If everyone tried to be slightly more sustainable, such as taking a shuttle to their favorite mountain instead of driving or putting certain waxes on their skies that don’t make the snow melt faster, it would lead to significant impacts. Skiing, in particular, is something I, and many others, love. Some people also depend on skiing to make a living, and with all the problems addressed in this article, it is becoming increasingly challenging for them to maintain their lifestyles. It is up to us to make a future worth getting excited for.
