Amidst the sadness of marking National Travel and Tourism Week during this global pandemic is a ray of hope pointing the way to economic recovery. Unlike the last two recessions, this one will not require unwinding the twisted schemes of either terrorists or greedy traders. This recovery hinges on reactivating consumer spending.
The global economy froze as the threat of infection stopped consumers in their tracks, bringing travel and tourism across the planet to a halt. Widely recognized as the industry most savaged by coronavirus, tourism represents just 3% of the U.S. GDP, but accounts for 36% of our nation’s job losses.
The U.S. Travel Association projects the ultimate impact will be nine times worse than 9/11.
Often taken for granted, the tourism industry is now showing its true might – in reverse.
The impacts of the absence of tourism are staggering, constricting employment, business earnings and tax revenues for governments large and small. Here in Colorado, along with setbacks for the energy economy, the tourism downturn has helped dig a $3 billion hole in the state’s budget outlook.
In mid-April, traveler spending in Colorado was down 89% compared with the same week in 2019, the lowest dip since the numbers began to freefall in early March. Oxford Economics reported that travelers spent a total of $49 million in Colorado the week of April 18. That was down $387 million from the $436 million spent that same week in 2019.
With signs of re-opening now flickering across the country, U.S. Travel believes the week of April 18 may have represented the trough of coronavirus impacts. Even if that is true, the climb back to the prosperity of February will be long and challenging.
While 2019 numbers are still coming in, it’s clear that Colorado marked its 10th consecutive year of record-breaking growth last year, and the new decade was off to a roaring start. At last count, Colorado travelers in 2018 directly injected $22.3 billion into the state economy, generating $1.37 billion in tax revenue, with 61 percent going to local governments. That economic impact will be far, far less in 2020.
Typically, our office promotes Colorado in collaboration with local destination marketing organizations –- from VISIT DENVER to the Durango Area Tourism Association to the Alamosa Convention and Visitors Bureau. These organizations play a critical role in stimulating spending, but most have been crippled by the sudden loss of their lifeblood – taxes on local hotel stays.
Across the state, these organizations – along with hoteliers, restaurateurs, outfitters, attractions, museums, special events and more – now are looking to the Colorado Tourism Office (CTO) as their best hope for attracting the dollars of travelers.
Our office has developed a new four-phase plan we’re calling “Wait. Ready, Set, Go!” Unlike the usual recovery plan, its rollout will hinge not on dates on the calendar, but on data, both from public health authorities and from traveler sentiment.
As more of Colorado reopens for travel, our attention will turn first to in-state travelers and then to those who will hop in a car for their summer vacation. We’ll also zero in on “resilient travelers,” that 16% who love travel so much that they’re willing to endure inconvenience and even some risk. Many will be choosing domestic, rather than international destinations this year.
We’ll also be leveraging another huge competitive advantage for Colorado, our statewide focus on destination stewardship through our “Care for Colorado” initiative.
While it’s a solid plan, challenges abound. Competition will be fierce. Every single destination across the globe and the U.S. shares an identical goal of restoring its tourism economy as fast as possible. Every destination will be in the market at the same time, and those with big budgets will be the loudest.
Like many parts of the country, we will face the extra challenge of managing a patchwork re-opening, with some communities ready to throw open the doors and others intent on keeping outsiders away. We’ll only promote those communities that tell us they are open for business. To alleviate resident – and visitor – concerns about travel, we’re also creating a new “Care for Coloradans” initiative.
The biggest challenge for tourism by far will be overcoming fear of coronavirus. The latest wave of U.S. Travel research with MMGY Global shows that COVID-related fears outstrip every other consideration for travel, including concerns about personal finances.
The key to this recovery is clear, but far from simple: restoring consumer confidence and making it safe to travel.
Cathy Ritter has been Director of the Colorado Tourism Office since 2015, overseeing a $22.8 million budget in a state where the stakes for tourism are high. She is chair of the National Council of State Tourism Directors and serves on the Executive Committee of the U.S. Travel Association.