Tourist bucks weigh in with record economy boost

Business

Travel and tourism is expected to contribute more to Australia's economy in 2024 than any previous year on record.

Four years after COVID-19 brought the sector to its knees with border closures and widespread restrictions on people movement, it's poised to surpass its 2019 peak by generating $265.5 billion, according to World Travel and Tourism Council forecasts.

The projection represents 10 per cent of the nation's economy and follows the industry's long-awaited bounce back to pre-pandemic levels in 2023.

The council, which will host its 24th international summit in Perth in October, predicts the robust growth spurt will extend over the next decade.

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In line with global trends, it says the sector's contribution to the national economy should exceed $345 billion by 2034. More than two million Australian jobs would be supported, representing 12 per cent of the country's workforce.

Employment in travel and tourism surged nearly 10 per cent last year, hitting 1.42 million or one in 10 jobs, and is expected to exceed 2018's peak by 2026.

"Australia is set to break tourism records," World Travel and Tourism Council president Julia Simpson said.

"The Perth summit will highlight its dynamic growth, reflecting travel and tourism's broader economic recovery and rising employment trends."

Ratings agency Fitch believes a full recovery of international tourism visitor numbers in the Asia-Pacific region will materialise in the first half of next year.

"However, we expect those prospects to remain vulnerable to multiple risks, such as a slow restoration of international air traffic, elevated airfares and energy prices and heightened geopolitical tensions," it said.

In Victoria, tourism and aviation is set for a targeted boost with the introduction of additional non-stop flights between Shanghai and Melbourne in a move expected to create almost 1200 jobs and amass more than $200 million for the state's economy annually.

This after Melbourne became Australia's first capital city airport to exceed pre-pandemic international capacity in December and with global travellers generating $6.4 billion in expenditure across the state last year, according to Jobs and Industry Minister Natalie Hutchins.

Inbound travel across the country is on a slow and steady recovery, with improvements month-on-month, says Australian Tourism Export Council chief Peter Shelley. "While this is slower than we'd like overall, there is still a growth trend which, if it continues, should see us back to 2019 levels towards the end of this year or early 2025," he said.

International holiday maker arrivals are at 74 per cent of 2019 levels. But Australians are heading overseas for holidays at a remarkable rate, surpassing numbers in April five years ago.

Google data reveals Bali as the top destination. London is next most popular, followed by Tokyo, Rome and Los Angeles. Melbourne ranks eighth and Sydney 10th.

The search engine behemoth has identified the top-five travel trends making waves in 2024: immersive cultural experiences, exploring nature, mindful escapes (read wellness retreats and food tours), day tripping and turning to AI to help plan trips.

Last year, domestic visitors set a record for total spending in Australia of $146 billion. The World Travel and Tourism Council predicts this figure will reach nearly $148 billion in 2024 and soar to almost $180 billion in 2034.

Despite reopening its border later than many other major destinations around the world in 2023, spending by overseas visitors surged nearly 195 per cent to $31.6 billion, ranking Australia 10th globally for growth.

It's likely it will near $35 billion this year and set a new record in 2025, and should reach more than $50 billion over the next decade.

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