Let's start out with the ugly. It is, after all, what you are probably obsessing about. The ugly part about today's economy is that it's one of the worst economic situations this country has experienced in quite some time. The jobless rate reached 7.2 percent in December, according to the Bureau of Labor Statistics. That means 11.1 million people are unemployed, 50 percent more than at the beginning of last year. Still, that number is lower than in past recessions. However, some analysts say the number doesn't account for the underemployed who have stopped looking for a job or who took part-time work when they need full-time work.
This ugliness comes after a period of relative wealth and mega spending on the part of individuals and businesses — spending beyond many people's means. Many of us have become so used to buying what we want when we want it, and worrying about actually paying for it later, that it's hard for people to adjust and cut back on their spending.
But as you've become aware, people are reducing their spending. That seems like more ugliness for the economy as it slows it even further. But really, in the long term, cutting back on our extravagant spending is actually healthier for individuals even though it hurts right now, especially for businesses that offer the services people are cutting back on.
Now to the bad. Some people are canceling their club memberships. Some club operators are seeing higher attrition rates. Some club operators are cutting dues and enrollment fees, or offering a few months of free memberships or a few free sessions of personal training. They are doing all of this in an effort to entice people to join a place they'd rather not go (health clubs) to do something they'd rather not do (exercise) so they can be as thin or as healthy as they want or need to be.
Now, let's end on the good. Not every club operator is facing increased attrition and decreased revenue. Some club operators are actually still growing and expanding. And as Mark Mastrov points out in his column, "Tried and True Game Changers for 2009," many club operators actually saw higher usage in December. (I can attest that my gym was very busy in November, December and January.)
Even better, most market researchers predict that the health club industry will continue to grow because of the high obesity rate and the growing emphasis at corporations on prevention (see "Industry Growth Still Anticipated"). IBISWorld Inc., an industry and market research company, projects that the industry will grow by 4 percent this year. Analysts at Piper Jaffray predict that although growth this year might be slower, the health club industry will grow 5 percent to 10 percent a year. Financial Week magazine predicted that despite the economy, the health club industry would increase by 2.2 percent in 2009 and listed it as one of the industries that would prosper this year. Looking even longer term, the U.S. Department of Labor projects that the number of jobs in the fitness industry will grow by 27 percent between 2006 and 2016.
Let's face it. The ugly truth that our nation is getting fatter (and because of that, also more unhealthy) only seems to secure the future of the fitness industry. However, that doesn't mean that we should continue with business as usual. We're still only reaching about 15 percent of the population. A huge opportunity awaits this business, and the club operators who figure out how to grab that opportunity are the ones who won't have to face a bad and ugly end.