Canada’s tourism sector must be revived
The COVID-19 crisis has resulted in significant travel restrictions around the world. Canada has totally or partially closed its borders to tourists and non-essential travelers.
Travel between provinces has also been restricted. Provinces like New Brunswick, Prince Edward Island, Newfoundland and Labrador have banned non-essential travel or all travel between provinces. And we were told not to travel to other provinces, including British Columbia and Ontario, unless it is essential.
But if people cannot travel, tourism cannot flourish. COVID-19 has strongly impacted this sector.
In 2019, tourism activities accounted for approximately 2% of Canada’s gross domestic product and generated approximately 750,000 jobs. Destination Canada reports that tourism is linked to one in 10 Canadian jobs, or 1.9 million jobs. Tourism contributes significantly to the Canadian economy; 99 percent of businesses in the Canadian tourism sector are small or medium-sized businesses. For them, it is more difficult to manage the loss of income.
As a result, losses in the Canadian tourism sector in 2020 are the worst on record. Destination Canada also states that the economic impact of COVID-19 on tourism is greater than that experienced after September 11, SARS and the 2008 economic crisis combined.
As reported by Statistics Canada in 2020: “In March 2020, the number of international arrivals to Canada from other countries decreased by 54.2% compared to February 2020, the largest monthly decline since 1972. The Most of the hotels were empty: as of the first week of April 2020, hotel occupancy rates were below 20% across Canada. ”
The impact on employment is enormous. Total paid employment in the tourism industry for April and May 2020 fell almost 60% from 2019 levels, more than double the trends seen in non-tourism industries. The effect on the Canadian economy can be a loss of 1.2% to 1.7% of total GDP and could have negative effects on up to half a million jobs.
Statistics from Destination Canada show that the tourism sector’s workforce is predominantly made up of women, youth and immigrants. Women make up 70 percent of the workforce in travel services, 60 percent in accommodation and 57.7 percent in food services. In addition, 30 percent of tourism jobs are held by Canadians aged 15 to 24, well above their 12.7 percent share of the total labor force.
Immigrants make up 26 percent of the tourism workforce and about 23 percent of the total Canadian workforce.
Problems in the tourism sector also threaten First Nations economies. Indigenous tourism was a growing sector before the crisis, contributing to the economic development of many First Nations. According to estimates from the Native Tourism Association of Canada, “all suggest that sectoral growth has been faster than the entire Canadian tourism sector, both in terms of GDP and employment.”
COVID-19 is seriously hampering the growth of this sector and, in some cases, its survival. Considering the economic difficulties of several First Nations communities, this trend is worrying.
The gradual lifting of restrictions related to COVID-19 allows a return to normalcy. But partial border closures remain. Opening the borders to fully vaccinated people is a good start, but there are still some issues. With most Western countries having only 40-65% of their population fully immunized, many people still remain unvaccinated and will not be able to travel.
The tourism sector needs a clear vision of its future. The reinstatement of restrictions could destroy the confidence of the companies concerned and have a disastrous impact on their survival.
A transparent, reliable and long-term government policy on reviving tourism is desperately needed.
Alexandre Massaux is an associate researcher at the Frontier Center for Public Policy.
– Troy Media