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Fitness Industry Still Feels COVID’s Negative Impact

It is through the support of the health and fitness industry community and research that relief efforts continue.

With the second quarter drawing to a close, many of us would like to forget 2020 altogether. Fitness consumers are returning to their health clubs and accessing club content digitally. Early reports from some clubs indicate 2021 is off to a promising start.

However, not all fitness business owners and operators feel or have fared the same. Some are still struggling, and some have gone out of business. It bears to remember how we got here, hoping 2021 looks better than 2020 and understanding that it may take several years for the industry to recover from the impact of COVID-19.

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The Fitness Club Industry’s Decline

The first group of states mandating club closures started in mid-March, 2020. By early April, 48 states would shut down gyms, health clubs, and studios. In the spring, virtually all clubs were closed in the U.S. During this time, 300 million Americans were without access to a fitness center.

By the end of 2020:

  • 17% of clubs permanently closed

  • Industry revenue fell by 58% relative to 2019 sales

  • 44% of the fitness industry workforce lost jobs

Executives, small business owner-operators, personal trainers, fitness instructors, administrative staff, and seasonal employees were all affected.

Without access to health and fitness clubs, some people managed to exercise outdoors and at home. But it wasn’t the same. Fitness consumers found it difficult to stay motivated without their gym, according to The COVID Era Fitness Consumer. A separate Emicity study found that California’s closures disproportionately impacted the physical activity levels of those in the lowest income brackets. Not everyone can purchase fitness equipment, a bike for the trails, or running gear for all-weather conditions.

There is no substitute for health and fitness clubs. Gyms and studios provide the environment, equipment, and accountability essential for healthy behavioral change—many at an affordable cost.

Restrictions Continue[d] to Curtail Fitness Businesses in 2021

By some accounts, 2021 started strong—member traffic was up in January 2021 from December 2020, but still down relative to January 2020. Data from payment processing companies shows that member joins are down Q1 2021 vs. Q1 2020 by 30-40%. Visits and bookings are also down Q1 2021 vs. Q1 2020.

The closure rate for studios is higher at 19% while the failure rate for clubs totals 14% as of writing. Closures, restrictions, and expenses incurred to comply with guidelines and improvements in ventilation continue to cripple health and fitness centers. Lean staffing levels mean many industry employees who lost their jobs may be gone for good. With persisting restrictions in 2021 and a slow vaccine rollout, fitness businesses still need relief.

Relief Efforts Remain Crucial for the Fitness Industry

Advocacy efforts for relief continue. PPP was not adequate to address the financial plight of operators. As a fixed-cost business, any minor change affecting revenue can dramatically impact a fitness club’s bottom line. Ongoing shutdowns and restrictions brought gyms and studios to the brink. Those who survived continue to struggle with the aftermath.

To date, the GYMS Act (Gyms Mitigation and Survival Act) has received 130 sponsors. The GYMS Act will address many of the financial challenges club operators faced due to the pandemic. The $30 billion fund—specific for fitness facilities—would be the first legislation passed to directly assist the health and fitness industry.

IHRSA will continue to seek relief efforts to fulfill the association’s mission of growing, promoting, and protecting the industry. The growing importance of physical activity has cultivated a renewed focus on advocacy for stimulus legislation like the Personal Health Investment Today (PHIT) Act.

“Fitness consumers found it difficult to stay motivated without their gym ...”

Fitness is More Important Now Than Ever

During club closures, 20% of health club members stopped exercising entirely, according to a longitudinal study by ClubIntel. The Physical Activity Council Overview Report shows that inactivity increased last year among Americans between the ages of 18-34. With many team sports on hiatus in 2020, research from the University of Wisconsin and Aspen Institute shows high school athletes reported symptoms of anxiety and depression.

The benefits of regular exercise on well-being, preventative health, and mental wellness are all well-documented. The PHIT Act would allow Americans to use pre-tax dollars—flexible spending accounts (FSAs) and health savings accounts (HSAs)—to pay for health club memberships, fitness equipment, exercise videos, and youth sports leagues.

The COVID-19 pandemic has shed light on the imperative of regular exercise and healthy habits for everyone. The COVID Era Fitness Consumer shows that those at elevated risk of COVID-19 due to preexisting conditions are doubling down on health club commitments as 60% aim to be more physically active.

Drawing on support and research, IHRSA will continue to seek relief for fitness businesses and support for legislation that champions physical activity.

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Author avatar

Melissa Rodriguez

As IHRSA's Director of Research and Insights, Melissa Rodriguez oversees research initiatives for the health club consumer, club operations, and international markets. The best part of her job is helping members better understand how IHRSA research can help them improve and expand their business. When she's not analyzing data and statistics, Melissa enjoys spending time with family, watching superhero series, poring over NBA and NFL box scores, and reading a good book.