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What Will the Cancellation of SXSW Mean for Austin’s Economy?

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South by Southwest (SXSW) is a week-long film, music, art, and tech festival. It generally occurs in mid-March, annually, with event goers taking the city by storm. Although some residents of this Texas Hill Country city and the capital of the Lone Star State bemoaned the event due to the influx of crowds, many welcomed it and the economic shot-in-the-arm it entailed. Due to recent health concerns around COVID-19, SXSW has announced its cancellation along with many of its counterpart festivities. This leaves many businesses wondering what this will mean for the city’s economy.

What Will the Cancellation of SXSW Mean for Austin’s Economy?

Photo: envato elements

Vanity Fair (VF), the Washington Post, and Business Insider addressed the economic fears on the heels of the SXSW cancellation in thought-provoking articles. “For now, though, the film community is showing remarkable resilience, rallying around Austin’s small business owners, the journalists, and workers who rely on income from the event, and the first-time filmmakers who are still hoping to find an audience,” VF writer Joanna Robinson said. Since 1987, this 10-day festival that celebrates the world’s creative culture has taken place in Austin, featuring some of the most interesting new releases in music, film, art, and technical developments its audiences have ever seen. With that, the boon for the local economy has grown exponentially. “I was crushed,” explained Roland Swenson, SXSW co-founder and Managing Director. In an interview with the Washington Post, he said he had only minutes to tell the festival staff prior to the news of its cancellation going public. Following that, a third of them were laid-off. “We were right on the edge before we put on the brakes. It’s going to be dark,” he told the Washington Post.

What Will the Cancellation of SXSW Mean for Austin’s Economy?

Photo: envato elements

Although Business Insider identified that some unofficial events still took place, a shared somber mood is palpable in Austin. The cancellation of SXSW will mean a disruption in the anticipated business for not only the festival but collaborators that work to support the needs of its fans. Hotels, restaurants, bars, and live music venues across the city were in the throes of gearing up for the business that was headed their way. Now, many accommodations are reviewing their room rosters and rates, venues have had to cancel additional staffing requirements, and restaurants can no longer expect the hungry crowds they once planned full menus for. The tourism industry, as a whole, will be reeling from the after-affects of the coronavirus and the path of destruction it leaves in its wake. The long-term economic impacts that the cancellation of SXSW will have on Austin won’t be completely tallied for some time. When it does, stimulus for the market will need to be reviewed with a fine-tooth comb.