Reimagining the $9 trillion tourism economy—what will it take?

Tourism made up 10 percent of global GDP in 2019 and was worth almost $9 trillion, 1 See “Economic impact reports,” World Travel & Tourism Council (WTTC), wttc.org. making the sector nearly three times larger than agriculture. However, the tourism value chain of suppliers and intermediaries has always been fragmented, with limited coordination among the small and medium-size enterprises (SMEs) that make up a large portion of the sector. Governments have generally played a limited role in the industry, with partial oversight and light-touch management.

COVID-19 has caused an unprecedented crisis for the tourism industry. International tourist arrivals are projected to plunge by 60 to 80 percent in 2020, and tourism spending is not likely to return to precrisis levels until 2024. This puts as many as 120 million jobs at risk. 2 “International tourist numbers could fall 60-80% in 2020, UNWTO reports,” World Tourism Organization, May 7, 2020, unwto.org.

Reopening tourism-related businesses and managing their recovery in a way that is safe, attractive for tourists, and economically viable will require coordination at a level not seen before. The public sector may be best placed to oversee this process in the context of the fragmented SME ecosystem, large state-owned enterprises controlling entry points, and the increasing impact of health-related agencies. As borders start reopening and interest in leisure rebounds in some regions , governments could take the opportunity to rethink their role within tourism, thereby potentially both assisting in the sector’s recovery and strengthening it in the long term.

In this article, we suggest four ways in which governments can reimagine their role in the tourism sector in the context of COVID-19.

1. Streamlining public–private interfaces through a tourism nerve center

Before COVID-19, most tourism ministries and authorities focused on destination marketing, industry promotions, and research. Many are now dealing with a raft of new regulations, stimulus programs, and protocols. They are also dealing with uncertainty around demand forecasting, and the decisions they make around which assets—such as airports—to reopen will have a major impact on the safety of tourists and sector employees.

Coordination between the public and private sectors in tourism was already complex prior to COVID-19. In the United Kingdom, for example, tourism falls within the remit of two departments—the Department for Business, Energy, and Industrial Strategy (BEIS) and the Department for Digital, Culture, Media & Sport (DCMS)—which interact with other government agencies and the private sector at several points. Complex coordination structures often make clarity and consistency difficult. These issues are exacerbated by the degree of coordination that will be required by the tourism sector in the aftermath of the crisis, both across government agencies (for example, between the ministries responsible for transport, tourism, and health), and between the government and private-sector players (such as for implementing protocols, syncing financial aid, and reopening assets).

Concentrating crucial leadership into a central nerve center  is a crisis management response many organizations have deployed in similar situations. Tourism nerve centers, which bring together public, private, and semi-private players into project teams to address five themes, could provide an active collaboration framework that is particularly suited to the diverse stakeholders within the tourism sector (Exhibit 1).

We analyzed stimulus packages across 24 economies, 3 Australia, Bahrain, Belgium, Canada, Egypt, Finland, France, Germany, Hong Kong, Indonesia, Israel, Italy, Kenya, Malaysia, New Zealand, Peru, Philippines, Singapore, South Africa, South Korea, Spain, Switzerland, Thailand, and the United Kingdom. which totaled nearly $100 billion in funds dedicated directly to the tourism sector, and close to $300 billion including cross-sector packages with a heavy tourism footprint. This stimulus was generally provided by multiple entities and government departments, and few countries had a single integrated view on beneficiaries and losers. We conducted surveys on how effective the public-sector response has been and found that two-thirds of tourism players were either unaware of the measures taken by government or felt they did not have sufficient impact. Given uncertainty about the timing and speed of the tourism recovery, obtaining quick feedback and redeploying funds will be critical to ensuring that stimulus packages have maximum impact.

2. Experimenting with new financing mechanisms

Most of the $100 billion stimulus that we analyzed was structured as grants, debt relief, and aid to SMEs and airlines. New Zealand has offered an NZ $15,000 (US $10,000) grant per SME to cover wages, for example, while Singapore has instituted an 8 percent cash grant on the gross monthly wages of local employees. Japan has waived the debt of small companies where income dropped more than 20 percent. In Germany, companies can use state-sponsored work-sharing schemes for up to six months, and the government provides an income replacement rate of 60 percent.

Our forecasts indicate that it will take four to seven years for tourism demand to return to 2019 levels, which means that overcapacity will be the new normal in the medium term. This prolonged period of low demand means that the way tourism is financed needs to change. The aforementioned types of policies are expensive and will be difficult for governments to sustain over multiple years. They also might not go far enough. A recent Organisation for Economic Co-operation and Development (OECD) survey of SMEs in the tourism sector suggested more than half would not survive the next few months, and the failure of businesses on anything like this scale would put the recovery far behind even the most conservative forecasts. 4 See Tourism policy responses to the coronavirus (COVID-19), OECD, June 2020, oecd.org. Governments and the private sector should be investigating new, innovative financing measures.

Revenue-pooling structures for hotels

One option would be the creation of revenue-pooling structures, which could help asset owners and operators, especially SMEs, to manage variable costs and losses moving forward. Hotels competing for the same segment in the same district, such as a beach strip, could have an incentive to pool revenues and losses while operating at reduced capacity. Instead of having all hotels operating at 20 to 40 percent occupancy, a subset of hotels could operate at a higher occupancy rate and share the revenue with the remainder. This would allow hotels to optimize variable costs and reduce the need for government stimulus. Non-operating hotels could channel stimulus funds into refurbishments or other investment, which would boost the destination’s attractiveness. Governments will need to be the intermediary between businesses through auditing or escrow accounts in this model.

Joint equity funds for small and medium-size enterprises

Government-backed equity funds could also be used to deploy private capital to help ensure that tourism-related SMEs survive the crisis (Exhibit 2). This principle underpins the European Commission’s temporary framework for recapitalization of state-aided enterprises, which provided an estimated €1.9 trillion in aid to the EU economy between March and May 2020. 5 See “State aid: Commission expands temporary framework to recapitalisation and subordinated debt measures to further support the economy in the context of the coronavirus outbreak,” European Commission, May 8, 2020, ec.europa.eu. Applying such a mechanism to SMEs would require creating an appropriate equity-holding structure, or securitizing equity stakes in multiple SMEs at once, reducing the overall risk profile for the investor. In addition, developing a standardized valuation methodology would avoid lengthy due diligence processes on each asset. Governments that do not have the resources to co-invest could limit their role to setting up those structures and opening them to potential private investors.

3. Ensuring transparent, consistent communication on protocols

The return of tourism demand requires that travelers and tourism-sector employees feel—and are—safe. Although international organizations such as the International Air Transport Association (IATA), and the World Travel & Tourism Council (WTTC) have developed a set of guidelines to serve as a baseline, local regulators are layering additional measures on top. This leads to low levels of harmonization regarding regulations imposed by local governments.

Our surveys of traveler confidence in the United States  suggests anxiety remains high, and authorities and destination managers must work to ensure travelers know about, and feel reassured by, protocols put in place for their protection. Our latest survey of traveler sentiment in China  suggests a significant gap between how confident travelers would like to feel and how confident they actually feel; actual confidence in safety is much lower than the expected level asked a month before.

One reason for this low level of confidence is confusion over the safety measures that are currently in place. Communication is therefore key to bolstering demand. Experience in Europe indicates that prompt, transparent, consistent communications from public agencies have had a similar impact on traveler demand as CEO announcements have on stock prices. Clear, credible announcements regarding the removal of travel restrictions have already led to increased air-travel searches and bookings. In the week that governments announced the removal of travel bans to a number of European summer destinations, for example, outbound air travel web search volumes recently exceeded precrisis levels by more than 20 percent in some countries.

The case of Greece helps illustrate the importance of clear and consistent communication. Greece was one of the first EU countries to announce the date of, and conditions and protocols for, border reopening. Since that announcement, Greece’s disease incidence has remained steady and there have been no changes to the announced protocols. The result: our joint research with trivago shows that Greece is now among the top five summer destinations for German travelers for the first time. In July and August, Greece will reach inbound airline ticketing levels that are approximately 50 percent of that achieved in the same period last year. This exceeds the rate in most other European summer destinations, including Croatia (35 percent), Portugal (around 30 percent), and Spain (around 40 percent). 6 Based on IATA Air Travel Pulse by McKinsey. In contrast, some destinations that have had inconsistent communications around the time frame of reopening have shown net cancellations of flights for June and July. Even for the high seasons toward the end of the year, inbound air travel ticketing barely reaches 30 percent of 2019 volumes.

Digital solutions can be an effective tool to bridge communication and to create consistency on protocols between governments and the private sector. In China, the health QR code system, which reflects past travel history and contact with infected people, is being widely used during the reopening stage. Travelers have to show their green, government-issued QR code before entering airports, hotels, and attractions. The code is also required for preflight check-in and, at certain destination airports, after landing.

4. Enabling a digital and analytics transformation within the tourism sector

Data sources and forecasts have shifted, and proliferated, in the crisis. Last year’s demand prediction models are no longer relevant, leaving many destinations struggling to understand how demand will evolve, and therefore how to manage supply. Uncertainty over the speed and shape of the recovery means that segmentation and marketing budgets, historically reassessed every few years, now need to be updated every few months. The tourism sector needs to undergo an analytics transformation to enable the coordination of marketing budgets, sector promotions, and calendars of events, and to ensure that products are marketed to the right population segment at the right time.

Governments have an opportunity to reimagine their roles in providing data infrastructure and capabilities to the tourism sector, and to investigate new and innovative operating models. This was already underway in some destinations before COVID-19. Singapore, for example, made heavy investments in its data and analytics stack over the past decade through the Singapore Tourism Analytics Network (STAN), which provided tourism players with visitor arrival statistics, passenger profiling, spending data, revenue data, and extensive customer-experience surveys. During the COVID-19 pandemic, real-time data on leading travel indicators and “nowcasts” (forecasts for the coming weeks and months) could be invaluable to inform the decisions of both public-sector and private-sector entities.

This analytics transformation will also help to address the digital gap that was evident in tourism even before the crisis. Digital services are vital for travelers: in 2019, more than 40 percent of US travelers used mobile devices to book their trips. 7 Global Digital Traveler Research 2019, Travelport, marketing.cloud.travelport.com; “Mobile travel trends 2019 in the words of industry experts,” blog entry by David MacHale, December 11, 2018, blog.digital.travelport.com. In Europe and the United States, as many as 60 percent of travel bookings are digital, and online travel agents can have a market share as high as 50 percent, particularly for smaller independent hotels. 8 Sean O’Neill, “Coronavirus upheaval prompts independent hotels to look at management company startups,” Skift, May 11, 2020, skift.com. COVID-19 is likely to accelerate the shift to digital as travelers look for flexibility and booking lead times shorten: more than 90 percent of recent trips in China  were booked within seven days of the trip itself. Many tourism businesses have struggled to keep pace with changing consumer preferences around digital. In particular, many tourism SMEs have not been fully able to integrate new digital capabilities in the way that larger businesses have, with barriers including language issues, and low levels of digital fluency. The commission rates on existing platforms, which range from 10 percent for larger hotel brands to 25 percent for independent hotels, also make it difficult for SMEs to compete in the digital space.

Governments are well-positioned to overcome the digital gap within the sector and to level the playing field for SMEs. The Tourism Exchange Australia (TXA) platform, which was created by the Australian government, is an example of enabling at scale. It acts as a matchmaker, connecting suppliers with distributors and intermediaries to create packages attractive to a specific segment of tourists, then uses tourist engagement to provide further analytical insights to travel intermediaries (Exhibit 3). This mechanism allows online travel agents to diversify their offerings by providing more experiences away from the beaten track, which both adds to Australia’s destination attractiveness, and gives small suppliers better access to customers.

Government-supported platforms or data lakes could allow the rapid creation of packages that include SME product and service offerings.

Governments that seize the opportunity to reimagine tourism operations and oversight will be well positioned to steer their national tourism industries safely into—and set them up to thrive within—the next normal.

Download the article in Arabic  (513KB)

Margaux Constantin is an associate partner in McKinsey’s Dubai office, Steve Saxon is a partner in the Shanghai office, and Jackey Yu  is an associate partner in the Hong Kong office.

The authors wish to thank Hugo Espirito Santo, Urs Binggeli, Jonathan Steinbach, Yassir Zouaoui, Rebecca Stone, and Ninan Chacko for their contributions to this article.

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Fact sheet: 2022 national travel and tourism strategy, office of public affairs.

The 2022 National Travel and Tourism Strategy was released on June 6, 2022, by U.S. Secretary of Commerce Gina M. Raimondo on behalf of the Tourism Policy Council (TPC). The new strategy focuses the full efforts of the federal government to promote the United States as a premier destination grounded in the breadth and diversity of our communities, and to foster a sector that drives economic growth, creates good jobs, and bolsters conservation and sustainability. Drawing on engagement and capabilities from across the federal government, the strategy aims to support broad-based economic growth in travel and tourism across the United States, its territories, and the District of Columbia.

Key points of the 2022 National Travel and Tourism Strategy

The federal government will work to implement the strategy under the leadership of the TPC and in partnership with the private sector, aiming toward an ambitious five-year goal of increasing American jobs by attracting and welcoming 90 million international visitors, who we estimate will spend $279 billion, annually by 2027.

The new National Travel and Tourism Strategy supports growth and competitiveness for an industry that, prior to the COVID-19 pandemic, generated $1.9 trillion in economic output and supported 9.5 million American jobs. Also, in 2019, nearly 80 million international travelers visited the United States and contributed nearly $240 billion to the U.S. economy, making the United States the global leader in revenue from international travel and tourism. As the top services export for the United States that year, travel and tourism generated a $53.4 billion trade surplus and supported 1 million jobs in the United States.

The strategy follows a four-point approach:

  • Promoting the United States as a Travel Destination Goal : Leverage existing programs and assets to promote the United States to international visitors and broaden marketing efforts to encourage visitation to underserved communities.
  • Facilitating Travel to and Within the United States Goal : Reduce barriers to trade in travel services and make it safer and more efficient for visitors to enter and travel within the United States.
  • Ensuring Diverse, Inclusive, and Accessible Tourism Experiences Goal : Extend the benefits of travel and tourism by supporting the development of diverse tourism products, focusing on under-served communities and populations. Address the financial and workplace needs of travel and tourism businesses, supporting destination communities as they grow their tourism economies. Deliver world-class experiences and customer service at federal lands and waters that showcase the nation’s assets while protecting them for future generations.
  • Fostering Resilient and Sustainable Travel and Tourism Goal : Reduce travel and tourism’s contributions to climate change and build a travel and tourism sector that is resilient to natural disasters, public health threats, and the impacts of climate change. Build a sustainable sector that integrates protecting natural resources, supporting the tourism economy, and ensuring equitable development.

Travel and Tourism Fast Facts

  • The travel and tourism industry supported 9.5 million American jobs through $1.9 trillion of economic activity in 2019. In fact, 1 in every 20 jobs in the United States was either directly or indirectly supported by travel and tourism. These jobs can be found in industries like lodging, food services, arts, entertainment, recreation, transportation, and education.
  • Travel and tourism was the top services export for the United States in 2019, generating a $53.4 billion trade surplus.
  • The travel and tourism industry was one of the U.S. business sectors hardest hit by the COVID-19 pandemic and subsequent health and travel restrictions, with travel exports decreasing nearly 65% from 2019 to 2020. 
  • The decline in travel and tourism contributed heavily to unemployment; leisure and hospitality lost 8.2 million jobs between February and April 2020 alone, accounting for 37% of the decline in overall nonfarm employment during that time. 
  • By 2021, the rollout of vaccines and lifting of international and domestic restrictions allowed travel and tourism to begin its recovery. International arrivals to the United States grew to 22.1 million in 2021, up from 19.2 million in 2020. Spending by international visitors also grew, reaching $81.0 billion, or 34 percent of 2019’s total.

More about the Tourism Policy Council and the 2022 National Travel and Tourism Strategy

Created by Congress and chaired by Secretary Raimondo, the Tourism Policy Council (TPC) is the interagency council charged with coordinating national policies and programs relating to travel and tourism. At the direction of Secretary Raimondo, the TPC created a new five-year strategy to focus U.S. government efforts in support of the travel and tourism sector which has been deeply and disproportionately affected by the COVID-19 pandemic.

Read the full strategy here

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The State of the Travel Industry in 2023: Current Trends and Future Outlook

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January 12, 2023

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Tony Capuano CEO, Marriott International, Inc.

Chip Rogers President & CEO, American Hotel & Lodging Association (AHLA)

As COVID-19 restrictions have continued to ease, the travel and hospitality industries have seen a resurgence in customers. Companies like Marriott have seen percentage increases in revenue and rate, even topping pre-pandemic levels.

During the U.S. Chamber of Commerce’s 2023 State of American Business event, Chip Rogers, President and CEO of the American Hotel and Lodging Association , and Tony Capuano, CEO of Marriott International, Inc. , sat down for a fireside chat. Read on for their insights on the post-COVID state of the travel industry, a shifting customer base, and the outlook for 2023 and beyond.

2022 Demonstrated the Power and Resilience of Travel

After declines amid the pandemic, 2022 brought about a positive recovery for the travel industry.

“[2022] reminded us of the power and resilience of travel,” said Capuano. “If you look at the forward bookings through the holiday season, [you’ll see] really strong and compelling numbers … so we’re really encouraged.”

“The only caveat I would give you about that optimism is, as you know, the booking windows are much shorter than we’ve seen them in a pre-pandemic world,” he added. “So those trends can change more quickly than we’re accustomed to."

The ‘Regular’ Customer Segments Are Shifting

At the start of pandemic recovery, industry leaders believed leisure travel would lead travel recovery, with business travel closely behind and group travel at a distant third, according to Capuano. While some of those predictions have held, others have shifted.

“Leisure [travel] continues to be exceedingly strong, and group [travel] has surprised to the upside,” he explained. “Business travel is perhaps the tortoise in this ‘Tortoise and the Hare,’ slow-and-steady recovery.”

However, Capuano noted customer segments are becoming less and less strictly defined.

“[There’s] this trend we've seen emerge over the pandemic of blended trip purpose … [where] more and more folks are combining leisure and business travel,” he said. “If this has staying power, I think it’s absolutely a game changer, as we get back to normal business travel and hopefully maintain that leisure travel.”

To accommodate this shifting demand, Marriott has focused on expanding offerings to accommodate both the business and leisure sides of travelers’ trips.

“[We’ve had] a very big focus on [expanding bandwidth], so that if [we’ve] got 300 rooms full of guests on Zoom calls simultaneously, we’ve got the bandwidth to cover it,” Capuano added. “[We’re also] being more thoughtful about fitness, leisure, and food and beverage offerings — and having the flexibility to pivot those offerings as somebody sheds their business suit on Thursday and changes into shorts and flip flops for the weekend.”

2023 Offers Hope for Continued Growth in the Travel and Hospitality Sectors

As the travel and hospitality sectors continue to grow and shift in the post-pandemic era, Capuano shared reasons for optimism in 2023.

“Number one, it's our people,” he emphasized. “When you see their passion, their enthusiasm, their resilience, their creativity, and just how joyful they are to have their hotels full again … it's hard not to be filled with optimism.”

“If you look at how far the industry has come over the last few years,” Capuano continued, “any lingering doubts folks may have had about the resilience of travel — and about the passion that the general public has to explore cities and countries — it's hard not to be excited about the future of our industry.”

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Towards resilience and sustainability: Travel and tourism development recovery

Window view of plane wing during sunset. The travel and tourism sector is slowly beginning to recover.

The travel and tourism sector is slowly beginning to recover. Image:  Unsplash/Eva Darron

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why tourism industry is growing

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  • The World Economic Forum has published its inaugural Travel and Tourism Development Index .
  • It focuses on the growing role of sustainability and resilience in travel and tourism growth.
  • Recovery for the sector is uneven and tourist arrivals in January 2022 were still 67% below 2019 levels, according to the World Tourism Organization.
  • Here are some key findings from the index on how the sector can build back better.

In 2018, international tourism grew for the ninth consecutive year. Tourist arrivals reached 1.4 billion and generated $1.7 trillion in export earnings, according to the World Tourism Organization (UNWTO).

Travel and tourism: post-pandemic

The picture looked very different two years later, as COVID-19 lockdowns hit the travel and tourism (T&T) sector hard. In 2020 alone, it faced losses of $4.5 trillion and 62 million jobs , impacting the living standards and well-being of communities across the globe.

While the roll-out of COVID-19 vaccines and easing of restrictions means a recovery has now started, it’s proving gradual and uneven largely due to variations in vaccine distribution, and because of Omicron and its BA.2 subvariant. And customers are not only being more cautious when it comes to health, but also around the impact of travel on the environment and local communities.

International tourist arrivals rose by 18 million in January 2022 compared with a year earlier. This equals the increase for the whole of 2021 from 2020, but January’s numbers were still 67% below the same month in 2019, according to the UNWTO.

The war in Ukraine has added to instability and economic disruption for the sector. Against this backdrop, the World Economic Forum’s inaugural Travel and Tourism Development Index reflects the growing role of sustainability and resilience in T&T growth, as well as the sector’s role in economic and social development more broadly.

The TTDI benchmarks and measures “the set of factors and policies that enable the sustainable and resilient development of the T&T sector, which in turn contributes to the development of a country”. The TTDI is a direct evolution of the long-running Travel and Tourism Competitiveness Index (TTCI), with the change reflecting the index’s increased coverage of T&T development concepts, including sustainability and resilience impact on T&T growth and is designed to highlight the sector’s role in broader economic and social development as well as the need for T&T stakeholder collaboration to mitigate the impact of the pandemic, bolster the recovery and deal with future challenges and risks. Some of the most notable framework and methodology differences between the TTCI and TTDI include the additions of new pillars, including Non-Leisure Resources, Socioeconomic Resilience and Conditions, and T&T Demand Pressure and Impact. Please see the Technical notes and methodology. section to learn more about the index and the differences between the TTCI and TTDI.

The Travel and Tourism Development Index 2021

The index covers 117 economies, which accounted for around 96% of the world’s direct T&T GDP in 2020. It measures the factors and policies that will enable sustainable and resilient development of the sector.

These include everything from business, safety and health conditions, to infrastructure and natural resources, environmental, socioeconomic and demand pressures.

“As the sector slowly recovers, it will be crucial that lessons are learned from recent and current crises and that steps are taken to embed long-term inclusivity, sustainability and resilience into the travel and tourism sector as it faces evolving challenges and risks,” says the publication, a collaboration between many of the sector’s stakeholders.

The index consists of five subindexes, 17 pillars and 112 individual indicators, distributed among the different pillars, as shown below.

The Travel and Tourism Development index is based on 17 pillars.

On average, scores increased by just 0.1% between 2019 and 2021, reflecting the difficult situation facing the sector. Only 39 out of 117 economies covered by the index improved by more than 1.0%, while 27 declined by over 1.0%.

Nine of the top 10 scoring countries are high-income economies in Europe or Asia-Pacific. Japan tops the ranking, with the United States in second, followed by Spain, France, Germany, Switzerland, Australia, the United Kingdom and Singapore. Italy completes the top 10, moving up from 12th in 2019.

Viet Nam experienced the greatest improvement in score, with a rise of 4.7% lifting it from 60th to 52nd on the overall index. Indonesia achieved the greatest improvement in rank, increasing its score by 3.4% to climb from 44th to 32nd, while Saudi Arabia achieved the second greatest improvement in rank, moving up to 33rd from 43rd as its score rose by 2.3%.

Rebuilding travel and tourism for a sustainable and resilient future

Here are some of the key findings from the publication:

1. The need for travel and tourism development has never been greater

The sector is a major driver of economic development, global connectivity and the livelihood of some of the populations and businesses most vulnerable to, and hard hit by, the pandemic. In 2019, T&T’s direct, indirect and induced GDP accounted for about 10% of global GDP . For many emerging economies, T&T is a major source of export revenue, foreign exchange earnings and investment. Research has shown that T&T growth can support social progress and create opportunities and well-being for communities, so supporting travel and tourism development and recovery will be critical.

2. Shifting demand dynamics have created opportunities and a need for adaptation

In the shorter term, challenges such as reduced capacity, geopolitical tensions and labour shortages are slowing recovery. However, opportunities have been created in markets such as domestic and nature-based tourism, the rise of digital nomads and “bleisure” travel – the addition of leisure activities to business travel. Many countries have provided incentives to boost domestic tourism. For example, Singapore, South Korea, Japan and Hong Kong SAR, China, have rolled out programmes that provide discounts, coupons and subsidies for domestic travel. The trends towards more rural and nature-based tourism offer an opportunity for less-developed economies to harness the benefits of travel and tourism given that the distribution and quality of natural assets are less tied to performance in economic development, with natural resources being one of the few pillars where non-high income economies typically outperform high-income countries. The travel and tourism sector stakeholders’ ability to adapt under these conditions highlights its capacity for adaptation and flexibility.

3. Development strategies can be employed to help the sector build back better

Amid the current challenges, shifting demand dynamics and future opportunities and risks, a more inclusive, sustainable and resilient travel and tourism sector can be – and needs to be – built, says the publication. But this calls for thoughtful and effective consideration. It also requires leveraging development drivers and strategies. This can be done by: restoring and accelerating international openness and consumer confidence through, for example, improved health and security; building favourable and inclusive labour, business and socioeconomic conditions; focusing more on environmental sustainability; strengthening the management of tourism demand and impact; and investing in digital technology.

A note on the methodology

Most of the dataset for the Travel & Tourism Development Index (TTDI) is statistical data from international organizations, with the remainder based on survey data from the World Economic Forum’s annual Executive Opinion Survey, which is used to measure concepts that are qualitative in nature or for which internationally comparable statistics are not available for enough countries. The index is an update of the Travel & Tourism Competitiveness Index (TTCI), but due to the altered methodology, framework and other differences, the 2021 TTDI should not be compared to the 2019 TTCI. To help address this, the 2019 results were recalculated using the new framework, methodology and indicators of the TTDI. Therefore, all comparisons in score and rank throughout this report are between the 2019 results and the 2021 results of the TTDI. Data for the TTDI 2021 was collected before the war in Ukraine.

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why tourism industry is growing

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Publications.

Tourism is one of the world's fastest growing industries and an important source of foreign exchange and employment, while being closely linked to the social, economic, and environmental well-being of many countries, especially developing countries. Maritime or ocean-related tourism, as well as coastal tourism, are for example vital sectors of the economy in small island developing States (SIDS) and coastal least developed countries (LDCs) (see also: The Potential of the Blue Economy report as well as the Community of Ocean Action on sustainable blue economy).

The World Tourism Organization defines sustainable tourism as “tourism that takes full account of its current and future economic, social and environmental impacts, addressing the needs of visitors, the industry, the environment and host communities".

Based on General assembly resolution 70/193, 2017 was declared as the  International Year of Sustainable Tourism for Development.

In the 2030 Agenda for Sustainable Development SDG target 8.9, aims to “by 2030, devise and implement policies to promote sustainable tourism that creates jobs and promotes local culture and products”. The importance of sustainable tourism is also highlighted in SDG target 12.b. which aims to “develop and implement tools to monitor sustainable development impacts for sustainable tourism that creates jobs and promotes local culture and products”.

Tourism is also identified as one of the tools to “by 2030, increase the economic benefits to Small Island developing States and least developed countries” as comprised in SDG target 14.7.

In the Rio+20 outcome document The Future We want, sustainable tourism is defined by paragraph 130 as a significant contributor “to the three dimensions of sustainable development” thanks to its close linkages to other sectors and its ability to create decent jobs and generate trade opportunities. Therefore, Member States recognize “the need to support sustainable tourism activities and relevant capacity-building that promote environmental awareness, conserve and protect the environment, respect wildlife, flora, biodiversity, ecosystems and cultural diversity, and improve the welfare and livelihoods of local communities by supporting their local economies and the human and natural environment as a whole. ” In paragraph 130, Member States also “call for enhanced support for sustainable tourism activities and relevant capacity-building in developing countries in order to contribute to the achievement of sustainable development”.

In paragraph 131, Member States “encourage the promotion of investment in sustainable tourism, including eco-tourism and cultural tourism, which may include creating small- and medium-sized enterprises and facilitating access to finance, including through microcredit initiatives for the poor, indigenous peoples and local communities in areas with high eco-tourism potential”. In this regard, Member States also “underline the importance of establishing, where necessary, appropriate guidelines and regulations in accordance with national priorities and legislation for promoting and supporting sustainable tourism”.

In 2002, the World Summit on Sustainable Development in Johannesburg called for the promotion of sustainable tourism development, including non-consumptive and eco-tourism, in Chapter IV, paragraph 43 of the Johannesburg Plan of Implementation.

At the Johannesburg Summit, the launch of the “Sustainable Tourism – Eliminating Poverty (ST-EP) initiative was announced. The initiative was inaugurated by the World Tourism Organization, in collaboration with UNCTAD, in order to develop sustainable tourism as a force for poverty alleviation.

The UN Commission on Sustainable Development (CSD) last reviewed the issue of sustainable tourism in 2001, when it was acting as the Preparatory Committee for the Johannesburg Summit.

The importance of sustainable tourism was also mentioned in Agenda 21.

For more information and documents on this topic,  please visit this link

UNWTO Annual Report 2015

2015 was a landmark year for the global community. In September, the 70th Session of the United Nations General Assembly adopted the Sustainable Development Goals (SDGs), a universal agenda for planet and people. Among the 17 SDGs and 169 associated targets, tourism is explicitly featured in Goa...

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In December 2015, the United Nations General Assembly declared 2017 as the International Year of Sustainable Tourism for Development. This is a unique opportunity to devote a year to activities that promote the transformational power of tourism to help us reach a better future. This important cele...

Emerging Issues for Small Island Developing States

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Transforming our World: The 2030 Agenda for Sustainable Development

This Agenda is a plan of action for people, planet and prosperity. It also seeks to strengthen universal peace in larger freedom, We recognize that eradicating poverty in all its forms and dimensions, including extreme poverty, is the greatest global challenge and an indispensable requirement for su...

Status and Trends of Caribbean Coral Reefs: 1970-2012

Previous Caribbean assessments lumped data together into a single database regardless of geographic location, reef environment, depth, oceanographic conditions, etc. Data from shallow lagoons and back reef environments were combined with data from deep fore-reef environments and atolls. Geographic c...

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Although it is widely recognized that tourism is not the cause of child exploitation, it can aggravate the problem when parts of its infrastructure, such as transport networks and accommodation facilities, are exploited by child abusers for nefarious ends. Additionally, many other factors that contr...

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Natural Resources Forum, a United Nations Sustainable Development Journal (NRF)

  Natural Resources Forum, a United Nations Sustainable Development Journal, seeks to address gaps in current knowledge and stimulate relevant policy discussions, leading to the implementation of the sustainable development agenda and the achievement of the Sustainable...

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Our Ocean, Our Future, Our Responsibility “The ocean is fundamental to life on our planet and to our future. The ocean is an important source of the planet’s biodiversity and plays a vital role in the climate system and water cycle. The ocean provides a range of ecosystem services, supplies us with

UN Ocean Conference 2022

The UN Ocean Conference 2022, co-hosted by the Governments of Kenya and Portugal, came at a critical time as the world was strengthening its efforts to mobilize, create and drive solutions to realize the 17 Sustainable Development Goals by 2030.

58th Session of the Commission for Social Development – CSocD58

22nd general assembly of the united nations world tourism organization, world tourism day 2017 official celebration.

This year’s World Tourism Day, held on 27 September, will be focused on Sustainable Tourism – a Tool for Development. Celebrated in line with the 2017 International Year of Sustainable Tourism for Development, the Day will be dedicated to exploring the contribution of tourism to the Sustainable Deve

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Accessible Tourism for all is about the creation of environments that can cater for the needs of all of us, whether we are traveling or staying at home. May that be due to a disability, even temporary, families with small children, or the ageing population, at some point in our lives, sooner or late

4th Global Summit on City Tourism

The World Tourism Organisation (UNWTO) and the Regional Council for Tourism of Marrakesh with support of the Government of Morroco are organizing the 4th Global Summit on City Tourism in Marrakesh, Morroco (9-10 December 2015). International experts in city tourism, representatives of city DMOs, of

2nd Euro-Asian Mountain Resorts Conference

The World Tourism Organisation (UNWTO) and Ulsan Metropolitan City with support of the Government of the Republic of Korea are organizing the 2nd Euro-Asian Mountain Resorts Conference, in Ulsan, Republic of Korea (14 - 16 October 2015). Under the title “Paving the Way for a Bright Future for Mounta

21st General Assembly of the United Nations World Tourism Organization

Unwto regional conference enhancing brand africa - fostering tourism development.

Tourism is one of the Africa’s most promising sectors in terms of development, and represents a major opportunity to foster inclusive development, increase the region’s participation in the global economy and generate revenues for investment in other activities, including environmental preservation.

  • January 2017 International Year of Tourism In the context of the universal 2030 Agenda for Sustainable Development and the Sustainable Development Goals (SDGs), the International Year aims to support a change in policies, business practices and consumer behavior towards a more sustainable tourism sector that can contribute to the SDGs.
  • January 2015 Targets 8.9, 12 b,14.7 The 2030 Agenda for Sustainable Development commits Member States, through Sustainable Development Goal Target 8.9 to “devise and implement policies to promote sustainable tourism that creates jobs and promotes local culture and products”. The importance of sustainable tourism, as a driver for jobs creation and the promotion of local culture and products, is also highlighted in Sustainable Development Goal target 12.b. Tourism is also identified as one of the tools to “increase [by 2030] the economic benefits to Small Island developing States and least developed countries”, through Sustainable Development Goals Target 14.7.
  • January 2012 Future We Want (Para 130-131) Sustainable tourism is defined as a significant contributor “to the three dimensions of sustainable development” thanks to its close linkages to other sectors and its ability to create decent jobs and generate trade opportunities. Therefore, Member States recognize “the need to support sustainable tourism activities and relevant capacity-building that promote environmental awareness, conserve and protect the environment, respect wildlife, flora, biodiversity, ecosystems and cultural diversity, and improve the welfare and livelihoods of local communities” as well as to “encourage the promotion of investment in sustainable tourism, including eco-tourism and cultural tourism, which may include creating small and medium sized enterprises and facilitating access to finance, including through microcredit initiatives for the poor, indigenous peoples and local communities in areas with high eco-tourism potential”.
  • January 2009 Roadmap for Recovery UNWTO announced in March 2009 the elaboration of a Roadmap for Recovery to be finalized by UNWTO’s General Assembly, based on seven action points. The Roadmap includes a set of 15 recommendations based on three interlocking action areas: resilience, stimulus, green economy aimed at supporting the tourism sector and the global economy.
  • January 2008 Global Sustainable Tourism Criteria The Global Sustainable Tourism Criteria represent the minimum requirements any tourism business should observe in order to ensure preservation and respect of the natural and cultural resources and make sure at the same time that tourism potential as tool for poverty alleviation is enforced. The Criteria are 41 and distributed into four different categories: 1) sustainability management, 2) social and economic 3) cultural 4) environmental.
  • January 2003 1st Int. Conf. on Climate Change and Tourism The conference was organized in order to gather tourism authorities, organizations, businesses and scientists to discuss on the impact that climate change can have on the tourist sector. The event took place from 9 till 11 April 2003 in Djerba, Tunisia.
  • January 2003 WTO becomes a UN specialized body By Resolution 453 (XV), the Assembly agreed on the transformation of the WTO into a United Nations specialized body. Such transformation was later ratified by the United Nations General Assembly with the adoption of Resolution A/RES/58/232.
  • January 2002 World Ecotourism Summit Held in May 2002, in Quebec City, Canada, the Summit represented the most important event in the framework of the International Year of Ecosystem. The Summit identified as main themes: ecotourism policy and planning, regulation of ecotourism, product development, marketing and promotion of ecotourism and monitoring costs and benefits of ecotourism.
  • January 1985 Tourism Bill of Rights and Tourist Code At the World Tourism Organization Sixth Assembly held in Sofia in 1985, the Tourism Bill of Rights and Tourist Code were adopted, setting out the rights and duties of tourists and host populations and formulating policies and action for implementation by states and the tourist industry.
  • January 1982 Acapulco Document Adopted in 1982, the Acapulco Document acknowledges the new dimension and role of tourism as a positive instrument towards the improvement of the quality of life for all peoples, as well as a significant force for peace and international understanding. The Acapulco Document also urges Member States to elaborate their policies, plans and programmes on tourism, in accordance with their national priorities and within the framework of the programme of work of the World Tourism Organization.

LuxuryTravelDiva

Why Is Tourism an Industry?

By Robert Palmer

Tourism is an industry that has become increasingly important in recent years. It plays a crucial role in the global economy and has become one of the fastest-growing industries worldwide. In this article, we will explore why tourism is an industry and why it is so important.

What is Tourism?

Tourism can be defined as the act of traveling to a different location for leisure or business purposes. It involves visiting new places, experiencing new cultures, and engaging in activities that are not available at home. Tourism can take many forms, including domestic and international travel, adventure tourism, eco-tourism, cultural tourism, and more.

Why is Tourism an Industry?

Tourism is an industry because it involves the production and consumption of goods and services that are bought and sold on the market. The tourism industry includes many different sectors, such as transportation, accommodation, food and beverage services, recreation activities, and more.

One of the reasons why tourism has become such an important industry is its ability to create jobs. The tourism sector employs millions of people worldwide, from hotel staff to tour guides to restaurant workers. It also generates revenue for many businesses that support the tourism industry.

Another reason why tourism is considered an industry is its impact on local economies. When tourists visit a destination, they often spend money on things like hotels, food, attractions, souvenirs, transportation services – all of which generate revenue for local businesses.

The Importance of Tourism

Tourism plays a vital role in the global economy. According to the World Travel & Tourism Council (WTTC), travel and tourism generated 10.4% of global GDP in 2019 – that’s $8.9 trillion! This figure is expected to rise even further by 2029.

Tourism also helps to promote cultural exchange between countries by allowing travelers to experience different cultures firsthand. This can help to break down stereotypes and increase understanding between different communities.

Furthermore, tourism can be a catalyst for development. It can help to create infrastructure, such as airports, roads, and public transportation systems, that benefit both tourists and locals alike. It can also provide opportunities for small businesses to grow and thrive.

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Tourism on Track for Full Recovery as New Data Shows Strong Start to 2023

  • All Regions

International tourism is well on its way to returning to pre-pandemic levels, with twice as many people travelling during the first quarter of 2023 than in the same period of 2022.

New Data from UNWTO: What We've Learned

The second UNWTO World Tourism Barometer of the year shows that the sector's swift recovery has continued into 2023. It shows that:

  • Overall, international arrivals reached 80% of pre-pandemic levels in the first quarter of 2023
  • An estimated 235 million tourists travelled internationally in the first three months, more than double the same period of 2022.
  • Tourism has continued to show its resilience. Revised data for 2022 shows over 960 million tourists travelling internationally last year, meaning two-thirds (66%) of pre-pandemic numbers were recovered.

Recovery by Region in Q1 2023:

  • The Middle East saw the strongest performance as the only region exceeding 2019 arrivals (+15%) and the first to recover pre-pandemic numbers in a full quarter.
  • Europe reached 90% of pre-pandemic levels, driven by strong intra-regional demand.
  • Africa reached 88% and the Americas about 85% of 2019 levels
  • Asia and the Pacific accelerated its recovery with  54% of pre-pandemic levels, but this upward trend is set to accelerate now that most destinations, particularly China , have re-opened.

In many places, we are close to or even above pre-pandemic levels of arrivals

The UNWTO data also analyses recovery by sub-region and by destination: Southern Mediterranean Europe and North Africa have also recovered pre-pandemic levels in Q1 2023, while Western Europe, Northern Europe, Central America and the Caribbean all came close to reaching those levels.

What it Means:

UNWTO Secretary-General Zurab Pololikashvili says: "The start of the year has shown again tourism's unique ability to bounce back. In many places, we are close to or even above pre-pandemic levels of arrivals. However, we must remain alert to challenges ranging from geopolitical insecurity, staffing shortages, and the potential impact of the cost-of-living crisis on tourism, and we must ensure tourism's return delivers on its responsibilities as a solution to the climate emergency and as a driver of inclusive development."

International tourism receipts grew back to hit the USD1 trillion mark in 2022, growing 50% in real terms compared to 2021, driven by the important rebound in international travel. International visitor spending reached 64% of pre-pandemic levels (-36% compared to 2019, measured in real terms). By regions, Europe enjoyed the best results in 2022 with nearly USD 550 billion in tourism receipts (EUR 520 billion), or 87% of pre-pandemic levels. Africa recovered 75% of its pre-pandemic receipts, the Middle East 70% and the Americas 68%. Due to prolonged border shutdowns, Asian destinations earned about 28%.

International tourism receipts: Percentage of 2019 levels recovered in 2022(%) *

International tourist arrivals: percentage of 2019 levels recovered in q1 2023 (%)*, looking ahead: what's in store.

The Q1 2023 results are in line with UNWTO's forward-looking scenarios for the year which project international arrivals to recover 80% to 95% of pre-pandemic levels. UNWTO's Panel of Experts expressed their confidence in a strong peak season (May-August) in the Northern Hemisphere, reflected in the latest UNWTO Confidence Index which indicates performance for the period is on track to be even better than 2022.

However, tourism's recovery also faces some challenges .  According to the UNWTO Panel of Experts, the economic situation remains the main factor weighing on the effective recovery of international tourism in 2023, with high inflation and rising oil prices translating into higher transport and accommodations costs.  As a result, tourists are expected to increasingly seek value for money and travel closer to home. Uncertainty derived from the Russian aggression against Ukraine and other mounting geopolitical tensions, also continue to represent downside risks.

International Tourist Arrivals, World and Regions

Related links.

  • Download the News Release in PDF
  • UNWTO World Tourism Barometer - EXCERPT Volume 21 • Issue 2 • May 2023
  • World Tourism Barometer (PPT version)
  • The UNWTO Tourism Data Dashboard
  • UNWTO World Tourism Barometer

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Related content, international tourism to reach pre-pandemic levels in 2024, international tourism to end 2023 close to 90% of pre-p..., tourism’s importance for growth highlighted in world ec..., international tourism swiftly overcoming pandemic downturn.

  • Solid growth projected for tourism this year

Tourists watch birds at Laohutan scenic area in Dalian, northeast China's Liaoning Province, April 16, 2024. [Photo/Xinhua]

  • The tourism sector will continue to grow in the first half of this year, after a prosperous first three months, experts said.

A report released recently by the China Tourism Academy said that in the first quarter of the year the tourism economy had recovered to roughly the level seen at the start of 2019 — before COVID-19 hit — following three quarters of growth. Tourism industry operators expressed growing confidence and people felt a stronger desire for travel in the first quarter.

The report said domestic tourism and related consumption rose 20 percent in the first quarter, with inbound and outbound visits averaging around 20 million a month.

"The tourism economy saw a good opening and stable operation in the first quarter, and the market has stepped into a period of new development," Ma Yiliang, the academy's chief statistician, said at a recent meeting in Beijing.

He said the tourism market has benefited from preferential policies on visas and payments as well as an increase in international flights.

"We've noticed that the increasing travel has brought increasing consumption," he said. "Also, some small cities or less-known destinations such as Harbin, in the northeastern province of Heilongjiang, and Tianshui, in northwest China's Gansu province, have gained popularity among young people because of their lower travel costs and good services. With more cities growing as trending destinations, they will invigorate the tourism industry."

Nanjing, capital of the eastern province of Jiangsu, received 65 million visits during the quarter, and the number of travelers on holidays such as Spring Festival was 3.5 times higher than usual, according to the city's culture and tourism bureau. More than 200 million people visited Nanjing last year.

"We estimate that the tourism economy will see a continuous and steady recovery in the first half of the year," Ma said. "Domestic tourist travel and tourism-related revenue will be roughly close to that of the same period of 2019, and inbound and outbound tourism will continuously increase."

In February, the academy estimated that domestic tourism visits will exceed 6 billion this year, with tourism-related revenue of over 6 trillion yuan ($830 billion). It said it expected inbound and outbound visits would surpass 260 million, bringing in international tourism revenue of $100 billion.

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Sustainable tourism worldwide - statistics & facts

What are the effects of global tourism on the climate, traveler awareness of social and environmental responsibility, key insights.

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Market size of the ecotourism sector worldwide in 2022, with a forecast for 2028 (in billion U.S. dollars)

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Challenges of travelers when trying to travel in a sustainable and socially conscious manner worldwide as of March 2022

Environmental impact

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Tourism-related transport's share of carbon emissions worldwide 2016-2030

Share of carbon dioxide emissions coming from tourism-related transport worldwide in 2016, with a forecast for 2030

Carbon footprint of tourism-related transport worldwide 2005-2030

Carbon dioxide emissions from tourism-related transport worldwide in 2005 and 2016, with a forecast for 2030 (in million metric tons of carbon dioxide)

Carbon footprint of international tourism transport worldwide 2005-2030, by type

Transport-related emissions from international tourist arrivals worldwide in 2005 and 2016, with a forecast for 2030, by mode of transport (in million metric tons of carbon dioxide)

Carbon footprint of domestic tourism transport worldwide 2005-2030, by type

Transport-related emissions from domestic tourist arrivals worldwide in 2005 and 2016, with a forecast for 2030 (in million metric tons of carbon dioxide), by mode of transport

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Number of international tourist arrivals worldwide from 2005 to 2023, by region (in millions)

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Number of flights performed by the global airline industry from 2004 to 2023, with a forecasts for 2024 (in millions)

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why tourism industry is growing

Billion-dollar industry: Erie County tourism growing as visitor spending is on the rise

Tourists are bringing and spending money when they visit Erie.

The Pennsylvania Tourism Office detailed in its 2022 visitor data report that people visiting Erie spent $1.03 billion in different categories from food and beverage to lodging and more.

For the Pennsylvania Great Lakes Region, which consists of Erie, Crawford, Mercer and Venango counties, visitor spending rose 13% at $1.75 billion which surpassed the pre-pandemic levels and exceeded numbers reported from 2016-2022.

Whether it's for festivals, sporting events, concerts or just curiosity in the region, people are finding reasons to visit northwestern Pennsylvania.

“These findings highlight the pivotal role tourism plays in strengthening Pennsylvania's economy," John Oliver, CEO of VisitErie stated in a news release. "With one in 10 jobs in Erie County connected to hospitality, tourism dollars support essential services, including transportation, infrastructure, education, and public safety programs. Without this contribution, every household in Pennsylvania would bear an additional tax burden of $880."

How are visitors spending their money?

Here is a breakdown of counties that makes up the Pa. Great Lakes Region and how visitors are spending money:

  • Total: $1.0388 billion
  • Lodging: $121.8 million
  • Food and beverage: $229.4 million
  • Retail: $187 million
  • Recreation: $219.9 million
  • Transportation: $280.8 million

More: It's totally happening April 8 in Erie, Pa. Check out these solar eclipse viewing events.

  • Total: $257.4 million
  • Lodging: $13 million
  • Food and beverage: $61.7 million
  • Retail: $41.9 million
  • Recreation: $39.4 million
  • Transportation: $101.4 million
  • Total: $309.8 million
  • Lodging: $33.8 million
  • Food and beverage: $74.4 million
  • Retail: $58.9 million
  • Recreation: $57.9 million
  • Transportation: $84.9 million
  • Total: $147.8 million
  • Lodging: $10.1 million
  • Food and beverage: $26.3 million
  • Retail: $21 million
  • Recreation: $21.7 million
  • Transportation: $68.7 million

An increase in spending from 2021

How do the numbers compare to the 2021 report? Here is the 2021 tourist spending report:

  • Total: $927.7 million
  • Lodging: $109.8 million
  • Food and beverage: $209.3 million
  • Retail: $179.3 million
  • Recreation: $180 million
  • Transportation: $24.93 million
  • Total: $220.3 million
  • Lodging: $11.7 million
  • Food and beverage: $53.8 million
  • Retail: $38.8 million
  • Recreation: $32.2 million
  • Transportation: $83.8 million
  • Total: $270 million
  • Lodging: $27.8 million
  • Food and beverage: $64.8 million
  • Retail: $57.2 million
  • Recreation: $46.9 million
  • Transportation: $73.1 million
  • Total: $127.8 million
  • Lodging: $8.6 million
  • Food and beverage: $22.7 million
  • Retail: $19.7 million
  • Transportation: $59.6 million

More: Erie is expecting heavy traffic for the April 8 solar eclipse, and not just on our roads

Erie tourism numbers back in swing post-pandemic

The numbers are showing that Erie is back on track in the tourism industry following the COVID-19 pandemic.

The lowest total amount for spending in the Great Lakes Region was $1.228 billion in 2020 around the start of the pandemic.

"It continues to show that Erie has come out of the pandemic stronger than before it," Oliver said. "It shows that we're reaching and able to convince visitors that Erie is a place they should vacation at and it's evident that they are coming here to vacation and spending their dollars here benefiting our economy."

An increase in spending and job creations

The Great Lakes Region has seen spending flex from $1.665 billion in 2016 to $1.754 billion in 2022. The highest amount of visitor spending was reported in 2022.

"Certainly we would like to see spending across all categories," Oliver said. "That occurs when we are successful in attracting more visitors to the area."

For the visitor spending and employment unit of the report, the Great Lakes Region increased by 766 jobs at a 6% increase. Erie County has seen a 92.9% increase in this category since 2019. Erie County in 2022 reported 7,414 jobs supported by visitor spending in 2022.

"We're able to see the numbers on a month to month basis," Oliver said. "We're seeing on average over the course of a year over 13,000 people in Erie County that are employed in hospitality businesses."

Gov. Shapiro calls for increased funding for tourism

Gov. Josh Shapiro is calling for a $15 million increase in tourism funding in his 2024-25 budget proposal, as stated in the Pennsylvania Office of Tourism news release.

This increase would support nearly 500,000 Pennsylvanians who work in the travel and tourism industry creating a major investment to drive economic growth, leading to new businesses and jobs.

Oliver said he was encouraged by the call for increased funding.

"It wasn't that many years ago that Pennsylvania was being funded at a level of two million dollars," Oliver said. "To see the additional dollars be recommended I think shows that the governor understands and recognizes the important role that tourism plays in the overall economy for Pennsylvania."

Contact Nicholas Sorensen at [email protected] .

This article originally appeared on Erie Times-News: Billion-dollar industry: Erie County tourism growing as visitor spending is on the rise

What will Erie County's population be in 2050? State projection leaves time to plan

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25 Hotel Industry Statistics [2023]: Hotel Rate Trends And Market Data

why tourism industry is growing

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Research Summary. The hotel industry not only reaches across the globe but also spans a wide cross-section of options ranging from budget motels to luxury resorts, making it an interesting field to study. Here are the key statistics on the hotel industry:

There are at least 187,000 hotels in the world as of 2023.

There are an estimated 17.5 million guestrooms in the world.

The global hospitality industry is worth over $4.548 trillion as of 2022.

There are about 1.6 million people employed by the U.S.’s accommodation industry.

The global travel and tourism industry was worth $4.671 trillion in 2020 , down from its $9.17 trillion value in 2019.

The average U.S. hotel occupancy rate is 64.2% as of February 2023.

1.6 million Americans are employed by the accommodation industry

Hotel Industry Statistics by Consumer Preferences

78% of millennials would rather spend their money on experiences than on things.

Hotels with a significant number of high-quality photos on their websites see a 15% increase in conversion rates.

This is compared to hotels that use few and/or low-quality photos. Including good photos of hotel rooms and amenities helps travelers know what they’re getting into and better imagine themselves there.

TripAdvisor shared that the number of photos a hotel has on its TripAdvisor profile has the most impact on traveler engagement with the listing.

More specifically, properties with at least one photo see a 138% increase in engagement and are 225% more likely to receive a booking inquiry, and those with over 100 photos see a 151% increase in engagement and are 283% more likely to receive a booking inquiry.

Europe has the highest hotel occupancy rate of any region in the world.

As of 2019, European hotels have an occupancy rate of 72.2%, meaning an average of 72.2% of all hotel rooms are occupied.

US Hotel Industry Statistics

There are 90,562 hotel and motel businesses in the U.S.

This number is a 0.4% increase from 2021, which is on trend with the average annual growth rate of 0.4% that this industry has seen from 2017 to 2022.

why tourism industry is growing

There are approximately 5.29 million hotel rooms in the U.S.

The U.S. hotel and motel industry is worth $177.6 billion.

This industry is predicted to grow by 33.6% throughout 2022 as it continues to recover from the COVID-19 pandemic, although it’s seen an average annual decline of 2.4% from 2017 to 2022.

why tourism industry is growing

The U.S. tourism industry was valued at $545.11 billion in 2020.

In 2020, U.S. hotels had an average occupancy rate of 44%.

Hotel Industry Statistics by Employment

The U.S.’s accommodation industry employs about 1.6 million people.

In Q1 2019, there were 1.352 million gross job gains in the U.S. leisure and hospitality sector.

Here are data points for each quarter from Q1 2019 through Q2 2021.

In Q1 of 2019, there were 1.22 million gross job losses in the U.S. leisure and hospitality industry.

Here are the numbers for each quarter following that through Q2 2021:

The average employee of the U.S. leisure and hospitality industry makes $19.44 an hour.

32% of U.S. leisure and hospitality industry employees have access to employer-sponsored health care.

43% get paid vacation from their employers, and 50% receive paid sick leave .

Hotel Industry Trends and Projections

In 2019, the global hotels and resorts market was worth over $1.5 trillion.

This was just before the COVID-19 pandemic caused widespread lockdowns in 2020, and it was the pinnacle of seven years of nearly continuous growth.

From 2021 to 2025, the global hotel and travel accommodation industry is projected to have a CAGR of 7%.

This will result in a market value of $1.05 trillion in 2025. In 2020, the global hotel and travel accommodation market was worth $673.02 billion, and it grew to $801.9 billion in 2021, which is a CAGR of 19.1%.

In 2020, travel and tourism contributed $4.671 trillion to the global GDP.

While this is a significant amount of money, it is also a significant decrease from the $9.17 trillion it contributed in 2019. This is a result of the 2020 COVID-19 lockdowns that significantly reduced the amount of travel in the world.

why tourism industry is growing

From 2008 to 2018, the number of hotels around the world has increased by nearly 14,300.

why tourism industry is growing

Hotel Industry Statistics FAQ

What is the growth rate of the hotel industry?

The growth rate of the hotel industry is 19.1%. This was the CAGR from 2020 to 2021 as the global hotel industry reopened after the COVID-19 pandemic lockdowns began to lift.

What are the four segments of the hospitality industry?

The four segments of the hospitality industry are Food and Beverage, Accommodation (also referred to as Lodging), Travel and Tourism, and Entertainment and Recreation.

You don’t necessarily have to be traveling to enjoy the hospitality industry’s offerings. The Food and Beverage sector, for example, includes restaurants , bowling alley food, and concessions stands, not just hotel restaurants. As a result, this is the largest sector of the hospitality industry.

The Accommodation or Lodging sector includes hotels, campgrounds, rental homes, and any other facility that gives people a place to sleep. This includes resorts, motels, and hostels all alike.

The Travel and Tourism sector covers the actual act of traveling via airlines, cruise ships, trains, taxis, and more. Whether you’re traveling for leisure or business, chances are you’ll utilize at least one of travel and tourism’s offerings on a trip.

The last sector of the hospitality industry is Entertainment and Recreation. This sector is made up of all the activities that people do just for the enjoyment of it. These include:

Swimming pools

Spectator sports

Movie theaters

Participatory sports (e.g., scuba diving, golf, tennis)

Amusement parks

How many American hospitality workers were fired or laid off in 2020?

10.65 million American hospitality workers were fired or laid off in 2020. While About 1.2 to 1.4 million people in this industry lost their jobs each quarter throughout 2019, 1.695 found themselves unemployed in Q1 2020, and a whopping 6.331 million were suddenly unemployed in Q2 2020 due to the COVID-19 pandemic lockdowns.

Is the hotel industry recovering?

Yes, the hotel industry is recovering. The global hotel and travel accommodation industry is expected to have a CAGR of 7% from 2021 to 2025.

What are the latest trends in the hotel industry?

The latest trends in the hotel industry are high-tech, green facilities, alternative accommodation options, and incorporating experiences into hotel stays.

Hotels are beginning to implement more and more smart technology, whether it’s a keyless entry or turning on the AC with an app. In addition, many hotels are looking for ways to reduce their carbon footprint by conserving water, reducing single-use plastics, and earning their LEED certifications.

Another hotel industry trend is that travelers (especially millennials) are looking more toward alternative accommodation options, whether that’s a rental house or villa, a mobile home, or hotels with a personality that reflect the local culture rather than standardized branding.

Hotels are responding to this by focusing on opening boutique hotels and facilities that bring unique elements to their decor, amenities, and even floor plans.

The hotel industry is a major player in the global and U.S. economies. In 2022, the global hotel industry was worth more than $4.548 trillion and is projected to see a CAGR of 7% from 2021 to 2025. In the U.S. alone, the hotel and motel industry is worth $177.6 billion, and the tourism industry is worth $545.11 billion.

Lockdowns in response to the COVID-19 pandemic in 2020 significantly impacted this industry. The worldwide travel and tourism industry contributed $4.671 trillion to the global GDP in 2020, which is just over half the amount it contributed in 2019 ($9.17 trillion).

In the U.S., over seven million leisure and hospitality industry employees lost their jobs during the first six months of 2020, compared to the just over five million that found themselves unemployed throughout all of 2019. Hotel occupancy rates also dropped by 33.3% from 2019 to 2020.

Eventbrite. “ Millennials: Fueling the Experience Economy. ” Accessed on February 16, 2022.

Medium . “ The Importance of Imagery on Hotel Websites. ” Accessed on February 16, 2022.

Frederic Gonzalo. “ Photos Impact Bookings More Than Reviews. ” Accessed on February 16, 2022.

Statista. “ Occupancy Rate of the Hotel Industry Worldwide From 2008 to 2019, by Region. ” Accessed on February 16, 2022.

IBISWorld. “ Hotels & Motels in the U.S. – Number of Businesses 2005-2027. ” Accessed on February 16, 2022.

Statista. “ Number of Hotel Rooms in the United States From 2017 to 2020, by Chain Scale Segment. ” Accessed on February 16, 2022.

IBISWorld. “ Hotels & Motels in the U.S. – Market Size 2005-2027. ” Accessed on February 16, 2022.

Statista. “ Market Size of the Tourism Sector in the United States From 2011 to 2020, with a Forecast for 2021. ” Accessed on February 16, 2022.

Statista. “ Occupancy Rate of Hotel Industry in the United States From 2001 to 2020. ” Accessed on February 16, 2022.

U.S. Bureau of Labor Statistics. “ Accommodation: NAICS 721. ” Accessed on February 16, 2022.

U.S. Bureau of Labor Statistics. “ Economic News Release: Employment Situation Summary. ” Accessed on February 16, 2022.

U.S. Bureau of Labor Statistics. “ Databases, Tables & Calculators by Subject: Gross Job Gains for the Leisure and Hospitality Sector in the U.S. (Rounded to the Nearest Thousands.) ” Accessed on February 16, 2022.

U.S. Bureau of Labor Statistics. “ Databases, Tables & Calculators by Subject: Gross Job Losses for the Leisure and Hospitality Sector in the U.S. (Rounded to the Nearest Thousands). ” Accessed on February 16, 2022.

U.S. Bureau of Labor Statistics. “ Leisure and Hospitality. ” Accessed on February 16, 2022.

IBISWorld. “ Global Hotels & Resorts – Market Size 2005-2027. ” Accessed on February 16, 2022.

Globe Newswire. “ Global Hotel and Other Travel Accommodation Market Report 2021: Market is Expected to Grow From $673.02 Billion in 2020 to $801.9 Billion in 2021 – Long-term Forecast to 2025 & 2030. ” Accessed on February 16, 2022.

Statista. “ Total Contribution of Travel and Tourism to Gross Domestic Product (GDP) Worldwide From 2006 to 2020. ” Accessed on February 16, 2022.

Statista. “ Total Number of Hotels Worldwide From 2008 to 2018. ” Accessed on February 16, 2022.

Hospitality Net. “ What Are the 4 Segments of the Hospitality Industry. ” Accessed on February 16, 2022.

Hotel Tech Report. “ 100 Hotel Trends You Need To Watch in 2022 & Beyond. ” Accessed on February 16, 2022.

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Abby is a writer who is passionate about the power of story. Whether it’s communicating complicated topics in a clear way or helping readers connect with another person or place from the comfort of their couch. Abby attended Oral Roberts University in Tulsa, Oklahoma, where she earned a degree in writing with concentrations in journalism and business.

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  5. Tourism Industry Demand, Size, Share, Statistics, CAGR of ~3% and

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