The World Travel and Tourism Council (WTTC), the body representing the Travel & Tourism private sector globally, has released its annual Economic Impact Report (EIR).
The report reveals the devastating impacts COVID-19 has had on the global travel industry last year, along with hopeful research that shows the sector could fully recover by 2022 if international travel resumes in June this year.
COVID-19 Has Had Devastating Impacts on The Travel Industry
It’s no surprise that COVID-19 had had devastating impacts on the global tourism industry, but the report reveals just how far-reaching the impacts have actually been. According to the WTTC, the global Travel & Tourism sector suffered a loss of almost US$4.5 trillion.
The report shows that the sector’s contribution to GDP dropped by 49.1%, in comparison to the overall global economy, which dropped by just 3.7%.
The global travel and tourism sector was responsible for generating one in four jobs worldwide in 2019, making up 10.6% (334 million) jobs globally. During the pandemic, more than 62 million of those jobs were lost – an 18% drop. These job losses were across the entire sector, with small and medium-sized enterprises (SMEs) particularly affected.
Altogether, the sector’s contribution to global GDP decreased by half compared to the previous year. In 2020, the sector was responsible for contributing US$4.7 trillion (5.5% of the global economy), down from nearly US$9.2 trillion in 2019 (10.4%).
More jobs continue to be threatened without a full recovery of the travel and tourism sector, as government retention schemes and reduced hours currently support many.
While the WTTC has praised governments around the world for their prompt response, they fear governments cannot continue to support these threatened jobs indefinitely. Instead, governments must help the tourism sector recover so it can continue to power the global economy.
Gloria Guevara, WTTC President & CEO, has said: “We must praise the prompt action of governments around the world for saving so many jobs and livelihoods at risk, thanks to various retention schemes, without which today’s figures would be far worse.
“However, WTTC’s annual Economic Impact Report shows the full extent of the pain our sector has had to endure over the past 12 months, which has needlessly devastated so many lives and businesses, large and small.
“With the sector’s contribution to GDP plunging by almost half, it’s more important than ever that Travel & Tourism is given the support needed so it can help power the economic recovery, which will be instrumental in enabling the world to revive from the effects of the pandemic.”
The report also showed a massive loss in international travel spending, which is down 69.4% from the previous year. Domestic travel fell by 45%, a lower decline that can be attributed to the fact that many countries allowed domestic travel during the last year.
Travel and Tourism Sector Could Fully Recover by 2022
The report shows that swift action by governments could see lost jobs and GDP contribution return to pre-pandemic levels by 2022.
WTTC research shows that if international mobility and travel resume by June this year, it will significantly boost global and country-level GDPs.
The sector’s contribution to global GDP could rise sharply this year, up 48.5% year-on-year. The research also shows that its contribution could almost reach the same levels of 2019 in 2022, with a further year-on-year rise of 25.3%.
The report also predicts that the 62 million jobs lost in 2020 could return by 2022 if the global vaccine rollout continues at pace and travel restrictions are relaxed before the summer tourist season.
WTTC Advocates for Resumption of International Travel in June
As travel restrictions and quarantines continue to threaten the recovery of the world economy, the WTTC strongly advocates for international travel to resume safely in June 2021.
It recommends that governments follow its four principles of recovery, which include a comprehensive coordinated international testing regime upon departure for all non-vaccinated travelers to eliminate quarantines.
The recommendations also include enhanced health and hygiene protocols and mandatory mask-wearing; shifting to individual traveler risk assessments instead of country risk assessments; and continued support for the sector, including fiscal, liquidity, and worker protection.
The global tourism body also urges governments around the world to provide a clear and decisive roadmap, such as Boris Johnson has done in the UK. This will allow businesses time to ramp up their operations in order to recover from the devastating losses of the pandemic.
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