Tourism well placed to ride the Brexit storm, despite drop in outbound travel, WTTC
The UK Travel & Tourism sector is expected to hold up in 2017, despite continued uncertainty due to Brexit, reduced consumer spending power, and the weaker pound, says new World Travel & Tourism Council (WTTC) Economic Impact Report 2017.
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With the fall in value of the pound after the Brexit vote, visitor exports, which is money spent by foreign visitors in a country, is forecast to grow by 6.2% this year, as we see the impact of the UK having become a cheaper destination for overseas visitors.
In 2016, business and leisure travel’s total contribution to the UK economy rose by 2.6% to £209 billion or 10.8% of GDP. The sector supported over 4 million jobs, which is 11.9% of the country’s total employment, according to the research.
Outbound travel to take the hit, domestic travel slowing down
The economic impact of the Brexit vote is expected to have diverging implications for domestic and international business and leisure travel spending in 2017. Whilst the spending of international visitors is expected to increase, domestic and outbound spend in the UK will suffer.
Due to higher inflation and weakened consumer spending prospects, the domestic spending outlook for 2017 has been downgraded from 3.2% to 2.6%. Furthermore outbound expenditure is forecast to decrease significantly in 2017 (-4.2%), as the drop in value of the pound will continue to impact UK citizens’ spending power and their propensity to holiday abroad.
David Scowsill, President & CEO, WTTC, said: “There is still widespread uncertainty on the exact impact Brexit will have on the Travel & Tourism sector. While we generally expect business to hold up, we call on the UK government to focus on four key issues, so that this sector can continue to create jobs and to boost the country’s economy”:
- MOBILITY OF LABOUR: The sector is highly dependent on foreign workers, especially from the EU. The ability for our sector to continue to employ workers from around the world is critical. We urge the government to take into account the specific needs of our industry for labour mobility.
- VISAS: There is clear evidence that visas are a barrier to travel, and current infrastructure could not cope with the processing and issuing of visas for travellers between the UK and Europe. We urge the government to protect visa free travel.
- OPEN SKIES: The advent of the European Single Aviation Market had an immediate and far reaching impact on air access between the UK and Europe, opening up a plethora of new routes and driving ticket prices down. We urge the government to remain part of the European Single Aviation Market.
- BORDER SYSTEMS: Entry and exit systems at airports and ports need take into account the increasing numbers of travellers moving. We urge the government to invest in processes, systems and infrastructure to meet the demand.