Investigate an issue or event since 1995 that has affected tourism demand in a country or region that you have studied.
In this assignment I will be researching the significant impact the recession had on the travel and tourism industry between 2008 and the present day. I will be looking into how domestic, inbound and outbound tourism was affected. I will mainly focus on the impact the recession had on the UK, but will need to also discuss the contributing factors Europe had in the recession.
How it all started
The recession, “a significant decline in the economic activity”, was the worst recession since the great depression of the 1930’s. It affected many sectors and the tourism industry was greatly affected. The recession hit in 2008 and millions were affected globally, although America and Europe were the biggest regions affected. Sir Richard Branson quoted “the crisis engulfing the travel industry was worse than the aftermath of 9/11”. So how did it all start? In my research it appears that the economic crisis in 2008/9 had the domino affect on businesses. The recession started and banks, financial institutions and the housing markets were badly hit, with redundancies and working hours being cut, this immediately had an impact on the tourism industry. People were scared to spend money, unsure of what the future would hold for them. With almost one million unemployed in the UK in 2008, reaching an all time high, people were no longer booking holidays, and having days out. Businesses were no longer spending on travel for their employees and clients. This was when the travel and tourism industry then became affected by the recession. Holiday companies were struggling, it was a scary time for all business in the tourism sector, seeing many small independent travel agencies going into administration. One of the biggest shocks in 2008 to the travel industry was XL Leisure group, the UK’s third biggest tour operator going out of business, with debts of over £143 million. Leaving 85,000 stranded abroad and 200,000 holidays cancelled. This also led to a loss of over 1700 jobs in the UK. It was a very tough time for the tourism industry in the UK and in my opinion travel agents and airlines faced the toughest financial crisis. Government statistics for 2009 showed that there was a drop of 10.4 million (15%) of visitors going abroad from the UK, than in 2008. This is a very significant drop. And many people and businesses would have been affected by this dramatic drop. Europe and the recession
Due to this decline in outbound tourism, many countries in the Eurozone, who were already feeling the impact of the recession, were being affected. With the GBP being weak against the Euro, holiday makers were no longer choosing Europe as a holiday destination. As in previous years where the Euro was as high as 1.5 to the GBP, European destinations were appealing to holiday makers, getting more for their money, when going on holiday. But in 2009 the Euro fell and it was only 1.1 to the GBP. Even if Britons were still holidaying in Europe, they were changing their trends, instead of going out for meals; they were choosing self catering options, to save themselves money. This would then have an impact on local business and the economy of the specific country they were staying in. All Europeans had been affected by the recession, some countries more than others. In some European countries, tourism is the biggest source of income. For example, in Malta, tourism contributes to fifteen percent of the nation’s gross domestic product, so in 2009 when they suffered an 8 percent drop from the previous year, it was a huge impact on the countries economy. The decline in inbound tourism to the UK
Visits to the UK from international tourists fell dramatically in the recession. In 2008 we had 31.9 million international arrivals and in 2009 that dropped to 29.9. This would not have only affected the UK’s...