Written By: Maurice Ondoy Project Contributor at AngelouEconomics | Did you realize the Economic Impact of travel and tourism in the United States?
According to the United Nations World Tourism Organization, travel and tourism is one of the world’s largest industries. It “surpasses that of oil exports, food products or automobiles.” Travel and tourism in the United States creates massive economic impacts in local, state, as well as national levels.
Globally, many dream of traveling to the “Land of Milk and Honey” and visiting Southern California to see the Hollywood sign or visiting New York, the city that never sleeps. In addition to domestic travel from Indiana to spend a getaway weekend in the windy city of Chicago, millions of people from around the world travel to the United States for either leisure, business trips, family holidays, or to visit Disneyworld in Orlando, Florida. This has resulted to the vibrant economy that the country has been experiencing. At AngelouEconomics, we regularly create economic impact studies highlighting how a local festival supports thousands of jobs in an area by tourists-event attendees spending several hundred thousand (or even million) dollars in sales into the local economy.
What exactly are the economic impacts of travel and tourism in the United States? According to the report of World Travel & Tourism Council, these are the quantitative figures with regards to the tourism industry’s economic impact:
Direct Contribution on GDP – The direct contribution of Travel and Tourism to the GDP was $503.7 billion in year 2016 and is forecasted to rise by 2.5% in year 2017. From 2017-2027, it is projected to rise by 3.3% per annum, amounting to $715.8 billion, 3.2% of total GDP in 2027. This primarily reflects the economic activity generated by industries such as hotels, travel agents, airlines and other passenger transportation (but excluding commuter services).
Total Contribution on GDP – The total contribution of Travel & Tourism to GDP was $1,509.2 billion, 8.1% of GDP in 2016, and is forecasted to rise by 2.3% in 2017, and to rise by 3.1% per annum to $2,099.6 billion, or 9.3% of GDP in 2027.
Direct Contribution on Employment – In 2016, Travel & Tourism directly supported 5,486,000 jobs (3.6% of total employment). This is expected to rise by 1.1% in 2017 and rise by 2.5% per annum to 7,074,000 jobs, or 4.3% of total employment in 2027. This includes employment by hotels, travel agents, airlines and other passenger transportation services (excluding commuter services). Also, these figures include retail and food sales directly supported by tourist spending.
Total Contribution on Employment – In 2016, Travel & Tourism was 9.4% of total employment supporting 14,207,000 jobs. This is expected to rise by 1.4% in 2017 to 14,407,000 jobs and rise by 2.5% per annum to 18,461,000 jobs in year 2027, or 11.3% of total employment.
Visitor Exports – These are a key component of the direct contribution of Travel & Tourism. In 2016, United States generated $212.3 billion in visitor exports. In 2017, this is expected to fall by 0.6%, and the country is expected to attract 76,622,000 international tourists. By year 2027, forecasts predict a total of 114,636,000 international tourists generating expenditure of $309.7 billion, an increase of 3.9% per annum.
Investment – Travel & Tourism industry is expected to have attracted capital investment of $160.8 billion in 2016. This is expected to rise by 2.5% in 2017, and rise by 3.6% over the next ten years to $234.2 billion in 2027. Travel & Tourism’s share of total national investment will rise from 4.5% in 2017 to 4.8% in 2027.
Finally, tourism does boost the economic growth of a region’s economy while providing high potential to support job creation. Additionally, the tourism industry also generates substantial benefits to both the United States and the tourists’ home countries by promoting cross-cultural understanding and international goodwill.
Image Source: https://disneyparks.disney.go.com/blog/2016/10/45th-anniversary-wallpaper-its-a-small-world/
To quote our favorite Disney theme ride song:
“There’s so much that we share
That it’s time we’re aware
It’s a small world after all
It’s a small world after all”
Disney – It’s A Small World Lyrics