The travel and tourism sector’s continued sluggish recovery will see its year-over-year contribution to global GDP rise by less than one-third in 2021, according to new research from the World Travel and Tourism Council (WTTC). The recovery of the sector, WTTC says, has been hampered by the lack of international coordination, severe travel restrictions and slower vaccination rates in some parts of the world.
In 2019, the travel and tourism sector generated nearly $9.2 trillion to the global economy; however, in 2020 the pandemic brought the industry to an almost complete standstill, which resulted in a 49.1 percent drop—representing a loss of nearly $ 4.5 trillion. While the global economy is set to receive a modest 30.7 percent year-over-year increase from travel and tourism in 2021, this will only represent $1.4 trillion and is mainly driven by domestic spending.
The economic modeling was conducted by Oxford Economics on behalf of WTTC and calculated a baseline scenario based on the current global vaccination rollout, consumer confidence and relaxed travel restrictions in some in regions around the world. The research reveals that at the current rate of recovery, travel and tourism’s contribution to the global economy could see a similar year-over-year rise of 31.7 percent in 2022.
In addition, while 62 million travel and tourism jobs around the world were lost last year, with the current pace of recovery, jobs are set to rise by only 0.7 percent this year. Research does show a more hopeful potential year-over-year jobs rise across the sector next year—by 18 percent.
According to WTTC, the sector’s contribution to global GDP and the rise in jobs could be more positive this year and next, if the following measures are met:
- Allow fully vaccinated travelers to move freely, irrespective of their origin or eventual destination, removing complex tiered systems.
- The implementation of digital solutions that enable all travelers to easily prove their COVID status, so in turn speeding up the process at borders around the world.
- Recognition of all vaccines authorized by the World Health Organization (WHO) and/or any of the Stringent Regulatory Authorities (SRA).
- Agreement from all relevant authorities that international travel is safe with enhanced health and safety protocols.
Should these four rules be followed before the end of 2021, WTTC says that the sector’s contribution to the global economy could jump by 37.5 percent—reaching $6.4 trillion this year (compared to $4.7 trillion in 2020). There is additionally hope that if restrictions continue to be lifted and with more international cooperation, governments could bring back nearly 19 million jobs before the year ends (up 6.8 percent).
The trend continues into next year when the sector’s contribution to the global economy could see a year-over-year rise of 34 percent, reaching $8.6 trillion, close to 2019, a record year for the travel and tourism industry. Similarly, jobs could surpass 2019 levels—up 20.1 percent year-over-year, to more than 349 million.
Source: WTTC
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