2023-05-15 18:34:46
(Montreal) Canada’s travel and tourism sector is poised for a major post-pandemic rebound, a new report from the World Travel and Tourism Council (WTTC) reveals.
The industry is expected to contribute $162.6 billion to the Canadian economy in 2023, up more than 17% from last year, CMVT estimated in its research. The forecasts are thus approaching the previous peak of 173.9 billion, recorded in 2019.
If forecasts materialize, the activity would generate some 90,000 additional jobs to reach 1.64 million this year, recovering almost all of the travel and tourism jobs cut during the COVID-19 pandemic.
Last year, spending by overseas travelers to Canada rose 64% to $23 billion, according to the report. CMVT President Julia Simpson said the trend is likely to continue, bringing this year’s projected total closer to the 43 billion mark reached in 2019.
“The sector is a key driver of economic growth and job creation in Canada, with cities like Vancouver, Toronto and Montreal remaining go-to global destinations for international visitors,” said Ms.me Simpson, whose organization represents more than 200 companies, including airlines, cruise lines and hotels.
Canadian transportation and hospitality businesses have been among the hardest hit by the pandemic, which has forced border closures and restricted travel and restaurant dining.
The post-pandemic recovery is far from complete, as inflation and labor shortages eat away at profit margins and growth.
Bankruptcy filings for restaurants, caterers and other food services have increased 116% since 2022, according to Restaurants Canada.
“For the majority of businesses in the foodservice sector in Canada, the pandemic has created significant financial hardship from which they are still struggling to recover,” the industry group said in a statement earlier in May.
Beth Potter, who heads the Tourism Industry Association of Canada, said she expects domestic tourism spending to match pre-pandemic levels this year, but the number of foreign visitors may not. not reach that peak before 2025. Business tourism is unlikely to fully recover before 2026, she calculates.
“There are a lot of changes in the way we do business — certainly a lot more use of (virtual) technology. But also, when you book these big conferences and trade shows, these events are booked for several years,” explained Ms.me Potter during a telephone interview. Business-related tourism event bookings for this year are at 47% of pre-pandemic levels, she said.
The biggest challenge facing tourism operators is the workforce, with some 300,000 jobs likely to go unfilled this year, Ms.me Potter, adding that rising interest rates also remained a major glitch.
“Most of these businesses went into debt during the pandemic with things like the CEBA loan,” Ms.me Potter, referring to the federal government’s Canada Emergency Business Account. These loans of up to $60,000 were interest-free, but will carry an interest rate of 5% beginning on 1is January 2024.
In 2019, overall tourism spending — for everything from airlines and hotels to bars and festivals — reached around $105 billion, Ms.me Potter.
Boosted by pandemic travel restrictions, the growing recognition of destinations offered across Canada marks an element of hope for many operators.
“Tourism is important to every community in our country. It’s not something that’s just focused on iconic destinations or big cities,” Ms.me Potter.
CMVT predicted that the sector would employ 2.1 million people and increase its contribution to gross domestic product to more than $238 billion by 2033, a 7% slice of the Canadian economy.
The report was produced in partnership with consultancy firm Oxford Economics.
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