The $9.5 Billion Gay Marriage Windfall
Forbes.com
by Miriam Marcus
June 16, 2009
Howls of protest erupted last month
when California's Supreme Court upheld Proposition
8, stripping gay and lesbian couples of their right
to marry. Adding to the din: all the disappointed
planners, seamstresses, jewelers, travel agents and
caterers who comprise the massive yet plodding
American wedding industry.
There are 781,267 same-sex couples living
together in the U.S., according to the Census
Bureau's 2005-07 American Community Survey. The
Williams Institute, a research arm of UCLA's law
school, predicts that if gay marriage were legalized
nationwide--only Massachusetts, Connecticut, Maine,
Vermont, Iowa and (as of earlier this month) New
Hampshire allow it now--about half of those couples
would tie the knot within three years.
Talk about a stimulus package. While
wedding-related revenues--snagged by small shops to
giant corporations like Tiffany, Williams-Sonoma and
Marriott International--top $160 billion (an average
wedding now costs $20,400), the industry has shrunk
at an annualized 1.9% rate after inflation since
1999. If half of the same-sex couples got hitched,
Forbes estimates that the industry would reap nearly
$10 billion in additional revenue.
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The Williams Institute draws from data on
same-sex marriages in Massachusetts (where the
practice has been legal for five years) and Vermont.
As of September 2008, 52% of all same-sex couples
living in Massachusetts were married; overall, the
institute says, in the states that provide legal
recognition, "more than 40%" of same-sex couples
married, entered a civil union or otherwise have
registered their relationships.
The average same-sex couple tends not to spend as
much on their wedding as the average straight
couple, notes Lee Badgett, research director at the
Williams Institute and professor of economics at
University of Massachusetts, Amherst. On average,
those couples spent 34% of what straight couples
spent on their weddings.
Chalk up part of that difference to the rush of
exhilaration to seal the deal after legislation gets
passed. Says Badgett: "It takes time to spend a lot
of money." Badgett adds that many couples may have
already held commitment ceremonies and as a result
don't have a need (or the money) for a large second
celebration. It's also possible that same-sex
couples don't have the financial support of their
parents. Or that more than a few are older and have
been together for so long that they don't feel the
urge for a big bash.
To estimate the financial impact of gay weddings
were they legalized nationally, we multiplied the
number of same-sex weddings by 34% of the amount
straight couples would spend on such items as
engagement rings, banquet halls, wedding dresses and
honeymoons. Add it all up, and it comes to $9.5
billion.
The biggest category--at $3.4 billion--is gifts.
According to the Association of Bridal Consultants,
the average amount spent per wedding gift is $113,
and the average couple receives 75 gifts. The haul
per couple: $8,475. To find the aggregate figure,
multiply by 406,000 (a little over half the number
of same-sex couples that live together). (We assumed
gift givers are as generous to same-sex couples as
they are to straight ones.)
Coming in second is reception and catering.
According to The Wedding Report, a research company
that tracks consumption trends, the average straight
couple spends $11,863 on the reception, catering and
bar service (including rentals of tents, tables,
chairs, etc.). Multiply by 406,000, take 34% of the
total and there's $1.6 billion.
Honeymoon expenditures came in third, at $694
million, followed by photography and video ($554
million) and jewelry ($502 million), including
wedding bands, earrings and anklets--but not
engagement rings, which clock in at $444 million.
