# Presentation: 257774

## Travel and Tourism

- F. X. Murray
- Overview of the Travel and Tourism Industry, its importance to the global economy and the significance of civil aviation to that industry.

## Travel & Tourism Data1999 and 2010

**High Lights**
**Global Data **
**U. S. Data**

## Travel & Tourism Data
and Supporting Reports    for the 
NASA Aeronautics Study

Prepared by SAIC

- and Supporting Reports    for the
- NASA Aeronautics Study
- Prepared by SAIC

## Critique & Technical Discussion of T & T Data

**1993 Data**
**Criticisms**
**Revisions**
**Recent Data System**
**Cautions**

## Comparing 1994 & 1999

- No adequate Documentation or Definitions for 1994 Data
- Terms not Comparable
- Estimating Techniques Different

## World Travel & Tourism Council
First Estimate of T & T Industry Economic Data--1993
Forecasts for 1994 and 2001
Immediate Objectives
Support “Free Trade in the Air”
Emphasis on Air transport
Show significance of the T & T Industry

- First Estimate of T & T Industry Economic Data--1993
- Forecasts for 1994 and 2001
- Immediate Objectives
- Support “Free Trade in the Air”
- Emphasis on Air transport
- Show significance of the T & T Industry

** ****T & T DATA HISTORY**

## Criticisms of T & T Data

- Industry Generated Data
- Lacked Documentation & Methodology
- Not Comparable with Existing Economic Databases
- Viewed by Others as Self-serving

## Recommendations of Professionals

- Rigorous Methodology
- Definitions and Documentation
- Links to Existing Official Economic Data Bases
- Credible Data Collection Entities

## Resulting Data System

**Most**** ****other OECD Countries Now Provide Compatible Data**
**UN Department of Economic & Social Affairs **
**Collects Data from Most Countries**
**Uses Methodology & Definitions** **Compatible with OECD Countries**

##   Data for the U. S.

**1995 Whitehouse Conference BEA to Develop Data System**
**Travel & Tourism Satellite Account Completed 1998**
**Methodology and Definitions Rigorously Documented**
**Integrated into the U. S.  Input and Output Accounts**
**I-O Factors among Industry Groups Developed**

## United Nations Data Collection

**    **
**United Nations Data Collection**
**• ****UN Department of Economic & Social Affairs (Information Office) and UN TourismOrganization**
**• ****Now Collecting Data from Most Countries**
**•****Uses Methodology & Definitions Compatible with OECD Countries**

## Limitations of T & T SA

- U. S. Data Based on 1992 Business Census
- Assumption--1992 relationships (Input-Output) hold until next Census
- I-O Factors revised after 1998 Business Census (Revisions Due Late 1999/Early 2000)

## World Travel & Tourism Council

- 1999 Forecast Of T & T Economic Impact Derived from 1998 Data
- Projection for 2010 is Included
- Global and Regional Forecasts for 1999 and Projections for 2010
- General Agreement on Methodology & Terms

## Limitations on Newly Released Forecasts & Projections

**All OECD Countries Now Report**
**No Data from Many Smaller Countries **
**Regional Samples Used for Some (Latin America, Eastern Europe) **
**E.g., Argentina and Brazil Used to Estimate Latin America **
**Assumed Growth Rates to 2010**

## Travel & TourismHigh Lights for 1999

**Travel & Tourism Impact Direct and Indirect upon the Global Economy**
- 11% of GDP
- 200 Million Jobs
- 8% of Total Employment
- 5.5 Million New Jobs per year until 2010

## U. S. Highlights

- Data used in WTTC Data System
- Importance of US in T & T Industry
- Employment
- Capital Investment
- Government Spending
- Federal Agencies
- State & Local

## Key Points from Global Projection For 2010 For Travel & Tourism

**Real Growth 3.3% per year Through 2010**
- Economy GDP will be 11% of Global GDP
- Employment will be 9%
- Tax Revenues at 11.7% of Total

## T & T Forecast for 2010        Investment

**Government Expenditures to Support T & T Increase at a higher rate than in T & T **
**Global Capital Investment**
**$733 B in 1999 and projected to be $1.5 Trillion by 2010.**
**T & T Capital Investment Grows Faster than Global Investment**

## United States Data for T & T

-  **Up to 25% of All Direct T & T Expenditures for Airfares **
**Largest Single Item**
**T & T  GDP  $1,067 Billion in 1999**
** ****Japan next highest at $389 B.**
**T & T GDP Projected at $1.8 Trillion by 2010**

## U. S. Employment & Government Spending

**T & T Economy accounts for 17.5 Million U.S. jobs in 1999 (13.2%) **
**20.2 Million  U.S. Jobs Expected in 2010 (13.5%)**
**Governments spent $52.2 Billion for T & T 1999**
** ****By 2010 Projected to reach $85 Billion**

## Analytical Tools: Direct Economic Factors

**Economic Factors for US Transportation Direct Impact per $ of Air Transport        **_**$ 1.00**_
**Primary Ind. (mfg) =  .14**
**Other Transport  =     .15**
**Services, Misc.  =       .26**
**Value Added  =           .45**
**Primary Industries include Agri., mining,  constr., & mfg.;  Other Transportation includes pipelines & own transport; Services include finance, insurance, communications, Utilities & Gov’t.**** **

## Direct & Indirect Economic Factors

**Factors for US Air Transportation Direct & Indirect Requirements:**
**Per $ of Air Transportation Service**
**Primary Ind. (mfg)  =  .35**
**Transportation       = 1.17**
**Services                 =    **_**.47**_
**Total                       =  1.99**
**The Direct Impact is .99 or approx. $1 to $1: Indirect to Direct**

## Travel & Tourism Factors

- Direct Products & Services Required per $1 expended for Travel & Tourism in the U. S.
- Air fares          .25
- Lodging           .16
- Meals, etc        .14
- Shopping         .12
- All Other          _.34_
- Total            $1.00

## Cautionary Notes

- Definitions for T & T Economic Measures are cumbersome and difficult to master, e.g.
- 1999 the “T & T **Industry GDP”** is $1,328 Billion,
-  **BUT...** “T & T **Economy GDP”** is $3,549,
**AND... “**T & T **Demand”** is $4,475 Billion

## Travel & Tourism Industry GDP (Supply)

- Includes **Direct Value Added** Associated with T & T Consumption
**Consumer expenditures (durables, nondurables & services)**
**Travel and Tourism Business Sales (private & public)**
**Travel and Tourism government expenditures**
**Travel and Tourism Foreign Trade (visitor exports)**

## Travel & Tourism Economy GDP 

**Direct and Indirect** **Value Added** including
**T & T Consumption**
**T & T Capital Investment (Public and Private)**
**Government Expenditures**
**T & T foreign Trade**

## Travel and Tourism Demand Includes 

- Personal **Consumption** (Durables, Non-durables, Services)
- Business Travel (Corporate & Government)
- Visitor Exports Government Expenditures
- Capital Investment
- Non-visitor Exports (World Tourism)

## Industry Perspective of the T & T Satellite Account

**Captures all economic activity related to persons traveling to and staying in places outside their usual environment.**
**For purposes of Satellite Accounting the optimal aggregated measurement is best determined from the demand point of view**
**Industry prefers the T & T Demand measure (largest measure of activity)**

## Gross Domestic Product for T & T

- GDP of Tourism Industries (Direct and Indirect GDP for Tourism Consumption)
- Imports by Tourist Industries
- Employment by Tourist Industries