Beyond the excitement of football potentially coming home, the World Cup could help to boost UK GDP growth through the summer months despite the obvious headwinds from higher energy prices and political turmoil. Previous tournaments have provided a small boost to UK GDP with bigger benefits generally associated with England progressing further in the tournament. That said, this benefit is usually a result of consumers bringing spending forward or shifting it away from other activities, which is another reason to think growth will slow sharply beyond July.

Will the World Cup boost UK GDP?

In theory, big one-off events can provide a welcome boost to the economy as people who wouldn’t normally stay out watching sports until 3am stay in the pub, or consumers go and splash out on a new TV.

Between 2010 and 2020 the areas that are most likely to benefit, supermarkets, pubs, bookies and other recreational activities, grew by an average of 0.3% per month over the periods that previous World Cup competitions took place – as our chart below shows – that translates to a rough boost of 0.1ppts to GDP.

Admittedly, this isn’t always the case, with output in those sectors falling during the last two major tournaments. That said, the 2022 world cup in Qatar took place in the winter which may have kept supporters at home and consumers had just experienced a huge shock to their real household incomes from the invasion of Ukraine. Meanwhile, England were sent home relatively early in both 2014 and 2024, perhaps explaining why those tournaments failed to provide a boost growth.

In any case, there’s a few good reasons to think the World Cup will provide a boost to the economy this time around. First, consumers are still saving around 9% of their incomes so may be willing to temporarily save a bit less to get out and enjoy the football. Second, Scotland qualified and made the knockout stages, which means the excitement wasn’t just limited to England this time around. England’s deep run means there have been more games than usual for hospitality venues to benefit from. Finally, the World Cup has coincided with a sustained period of hot and sunny weather, which has likely added to the impetus for consumers to get out and spend more on hospitality.

In fact, Hospitality UK estimates that pub bookings are up 293% year-on-year, and analysis from the British Beer and Pub association suggests an extra 55m pints will be consumed during the tournament. Overall, the tournament and good weather could boost GDP in July by 0.1 to 0,2ppts.

Any boost to growth is unlikely to provide a sustained uplift

However, that boost to growth may prove to be as illusory as some of the elaborate dives we have already seen in the tournament. The biggest impact of these events is to shift the timing and type of spending rather than the total amount of money people are spending in the economy. This is because huge sporting events don’t change the amount of money in people’s pockets, beyond some extra hours for hospitality staff which has a limited impact on a national scale. That means consumers are far more likely to shift spending towards pints at the pub or a takeaway given the late kick-offs and cutback on other forms of recreational spending, such as cinema trips or spend less once the tournament is over. Alternatively, they may shift the timing of spending. Going to the pub on a Wednesday rather than a Saturday for example or allowing extra pub trips this month knowing they will rein it in next month.

The result is that the boost to hospitality spending will be partially offset by lower spending elsewhere and further offset by reductions in future spending. That doesn’t mean the total boost will be zero, especially if some consumers have funded extra pub trips through a temporary reduction in saving, but it does mean the boost from the World Cup won’t make much difference to overall growth this year.

What’s more, it may also be the case that celebrating Jude Bellingham’s extra time winner in the middle of the night has prompted a few extra unexplained sick days or some employees feeling a little worse for wear the following morning which could act as a dampener on productivity, offsetting some of the benefit to the economy.

Ultimately, this means that the World Cup has probably helped the economy to keep ticking along through the summer despite continued uncertainty from the war in the Middle East and domestic politics, but this is unlikely to lead to a sustained pickup in growth. Instead, expect activity to start to fall back in these industries once the tournament is over. This is another reason to think that activity might stagnate in the second half of the year alongside another big budget that weighs on sentiment.

For now though, some positive news on the football will go some way to offsetting the negative news from another flare up in Iran and worries about another big tax raising budget.

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