North America contributes 25 percent of the world’s travel and tourism GDP, according to the new 2019 Cities Report from the World Travel & Tourism Council. The sector accounts for $686.6 billion overall.
According to the report, the tourism industries of many cities across North America make a significant contribution to the city’s overall GDP, with Cancun’s travel and tourism sector contributing almost half (46.8%), and Las Vegas contributing more than a quarter (27.4%).
Of the top 10 cities in this category, Las Vegas is followed by Orlando, which directly contributes 19.8 percent to the city’s overall GDP.
The Cities Report shows these 73 cities account for $691 billion in direct travel and tourism GDP, which represents 25 percent of the sector’s direct global GDP and accounts for over 17 million jobs. Additionally, in 2018, direct travel and tourism GDP across the cities grew by 3.6 percent, above the overall city economy growth of 3.0 percent. The top 10 largest cities for direct travel and tourism contribution to city GDP include Orlando ($26.3BN), New York ($26BN) and Mexico City ($24.6BN).
International visitor spending is usually more important to cities than it is to countries as a whole. Two out of the top 10 cities for international visitor spending were in North America, with international visitors to New York spending $21BN and those to Miami spending $17BN.
Infrastructure development and prioritization of tourism has been a key driver of travel and tourism growth, the WTTC said. Revenues from international visitors will in some cases pay for city infrastructure projects, the provision of public workers and services that improve the quality of life for residents. For example, the international visitor spend in New York last year was 3.8 times higher than the costs of the NYPD, and nearly twice the budget for city schools.
Notably, four out of the top 10 cities for domestic visitor spending are in the region, with Orlando taking the third spot at $40.7BN and Las Vegas in sixth place with $29.3BN. Sitting in eighth position, domestic spending in New York reached $25.3BN, whilst in Mexico City hit $16BN.
However, when considering domestic spend by percentage, domestic tourism in Chicago represents the greatest share of North American cities analyzed in the report at 88.3 percent, directly followed by Mexico City at 87.2 percent.
Cities with an overreliance on domestic or international demand can be more exposed to economic and geopolitical crises. For example, large cities which are highly reliant on domestic demand could be exposed to changes in the domestic economy. On the other hand, cities which are more reliant on international demand and/or particular source markets may be vulnerable to external disruptions. The report highlights several cities which demonstrate a more balanced split between domestic and international demand, this includes two North American cities: San Francisco and New York. In contrast, North American cities such as Orlando and Las Vegas have a skewed divide, with over 85 percent of spending coming from domestic visitors in both cities.