Official stats confirm Abta findings on overseas travel and GDP

Official stats confirm Abta findings on overseas travel and GDP

Sometimes you wait an age for a piece of research to come along and then, like a number 38 bus, two pieces appear in a row.

When Abta released the results of research it had commissioned on the economic impact of outbound travel last month it was hailed as a first.

The study by the Centre for Economics and Business Research (Cebr), published to coincide with Abta’s Travel Matters conference in London in May, reported outbound travel contributes more than £22 billion a year to the UK economy, amounting to 1.6% of GDP. It then calculated a figure for the additional, indirect contribution to GDP.

Lo and behold, last week the UK Office for National Statistics (ONS) released figures from its new UK Tourism Satellite Account on the contribution of tourism and associated sectors to the UK economy.

The ONS calculated the total annual contribution of tourism in 2009 at £113 billion, of which £22 billion was spent in the UK by residents travelling abroad on holiday. According to the ONS, the money was spent “on items such as air fares and travel agencies’ services”.

It would be handy to have the figure for 2011 or 2010, of course, but it is in the nature of these kind of stats to be historic. The key thing is the ONS's £22 billion figure, a repetition of that in the Abta-commissioned report. (It would be interesting to know if they were arrived at in the same way.*)

The ONS reported overseas visitors to the UK spent £19 billion in the country in 2009, contributing £19 billion to the UK economy, and £3 billion less than departing UK holidaymakers.

For interest, UK domestic visitors spent £22 billion on overnight trips within the UK and more than double that, £47 billion, on day trips.

So the combined contribution of travellers who fly (for the most part) in and out of the country was £41 billion (the spending of UK outbound travellers in the UK added to that of overseas visitors). The ONS put the money spent abroad by UK travellers at £31.7 billion.

Thus, we might say travel into and out of the UK resulted in a net tourism surplus of £9.3 billion (according to the ONS) and not the ‘tourism deficit’ referred to each month in ONS travel and tourism statistics.

Interestingly, the figures suggest the ‘staycation’ phenomenon loved by the media, and suggested as a consumer reaction to the post-2008 economic crisis, has been something of a fairy at the bottom of the garden.

The ONS notes that between 2008 and 2009 there was a 17% fall in expenditure in the UK by British residents travelling overseas. That would reflect the impact of the banking crisis and recession which triggered a similar numerical fall in holiday trips abroad. There was a fall in overall expenditure on tourism from £119 billion to £113 billion between these years.

However, the ONS notes an increase of less than 4% in spending by UK residents on domestic overnight trips between 2008 and 2009. At the same time, there was a decline of 4% in spending by domestic travellers on day trips. There was no noticeable ‘staycation’ impact on spending – in fact, the contribution of domestic travel to UK GDP went down.

Interestingly, too, it was the decline in overseas trips by UK residents and the resulting fall in spending in the UK before their departure that accounted for 80% of the decline in travel’s contribution to UK GDP between 2008 and 2009.

Remember that next time some fool mentions the ‘tourism deficit’.

Tourism minister John Penrose responded to the Abta-Cebr figures by telling the Travel Matters conference: “We all know outbound travel is big and important, but this report provides the facts underpinning that when I put the case in Whitehall.”

Now he has two sources of facts to draw upon.

(*I'm guilty of being facetious here. The Cebr report openly drew on the initial ONS Tourism Satellite Account figures for 2008.)

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