Tourism regions from pandemic shock to a new normal

November 2021

The tourism sector is one of – if not the sector – most severely hit by the consequences of the COVID-19 pandemic. For many tourist areas it will take some years before they are back to pre-pandemic levels – for good and bad. A recent study carried out for DG REGIO provides some insights on this.

The tourism sector involves a wide range of activities going far beyond holiday accommodations, restaurants, bars, tourism attractions and charter flights. There is a wide range of activities related to travel & logistics, conferences, event management, catering, tour operators, travel agencies, booking platforms, cruise ships, airports, marketing, tourism management organisations, and all kinds of background services e.g. providing financial and IT solutions for the tourism industry. Overall, the tourism industry in the EU involved about 3 million enterprises and employed almost 23 million people (that is 11% of total EU employment) and accounted for 9.5% of the GDP in 2019.

These grand figures come with a considerable variation across European regions. Employment in tourism varies between 66% in the South Aegean in Greece and only 2% in Mazowiecki, the region surrounding Warsaw in Poland. Approximately 1/3 of the regions in the EU had more than 12% of their employment in tourism in 2019. These are mainly around the Mediterranean Sea, other regions in Portugal, Spain and France, the Alps, coastal areas of Belgium, the Netherlands and Germany, Estonia, Finland and Sweden.

The share of regional employment in the tourism industry is just one of several factors influencing how hard, a region’s tourism industry has been hit the consequences of COVID-19. Also the origin of tourist plays a role, partly as national tourism was more easily possible than international tourism, but also because the spending patterns of national and international tourists differ. Generally, domestic tourists are the largest group, accounting for 53% of nights spent in 2019, and dominate in 2/3 of the regions in the EU (see map). In some regions mainly in Germany, Romanian, Poland, the Spanish inland, France, Sweden and Finland domestic tourists account for more than 80% of nights spent. At European level, tourists from other EU countries are the second largest group. They accounted for 35% of nights spent in 2019. However, only in 5% of the EU regions, the nights spent by tourists from other EU countries outrank the nights spent share by domestic or non-EU tourists. This is the case for Luxembourg, Malta, Croatia, the urban areas of Vienna, Brussels, Thessaloniki and Salzburg, and prominent tourist areas such as the Balearic and Canary Islands, Madeira, Tirol and Vorarlberg. Tourists from outside the EU account for 12% of nights spent in 2019. The highest shares of non-EU tourists can be found Europe’s global tourist destinations as well as in cities and regions with good links to Russia.

Analysing the contribution of tourism to regional employment and to GDP, the share of EU and non-EU tourists (reliance on non-domestic tourists) and a high seasonality with a focus on winter and spring, as well as the severeness of COVID-19 related restrictions, has allowed to identify the regions potentially most severely affected by the negative impacts of the pandemic (see map). The regions potentially most affected comprise the capital regions of Athens, Berlin, Madrid and Paris, and destinations in Southern Europe and the Alps, in particular on the Iberian Peninsula and in Italy, Greece and Cyprus. Large parts of Eastern and Northwest Europe are less affected as tourism plays a lesser role in the regional economies.

As most tourists could not follow their usual holiday preferences during the pandemic some explored new destinations. These were often closer to home and with a stronger emphasis on domestic travel, so for some regions the pandemic brought new tourism potential. Nonetheless, for most regions with a strong tourism industry, this could not substitute the negative impacts of the pandemic.

It will take several years before the tourism industry reaches pre-pandemic levels. Estimates range from 4 to 9 years. In any case, some expected longer-lasting impacts are a shift to more domestic tourism, lower traveller confidence and structural changes in the tourism industry, as well as longer term trends related to sustainability and digitalisation (see also earlier blog post).

Tourism will remain an important part of Europe’s economy, but the pandemic has made it clear that tourism needs to find a ‘new normal’. This is further underlined by the challenges of climate change. Key lessons drawn in the recent DG REGIO study concern the path to recovery and preparation for the future of tourism regions. These include the need to manage tourism growth more responsibly to increase local benefits; assist less-crowded rural destinations to avoid harmful effects of mass tourism; develop more sustainable tourism offers and ensure sustainable destination management; boost digitalisation in tourism SMEs; and strengthen collaboration, innovation and creative ideas in the tourism industry in co-creative processes with tourists and residents.

The full study is availbel here.

by Kai Böhme

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