services sector and tourism

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Research Article

The role of tourism in service sector employment: Do market capital, financial development and trade also play a role?

Roles Conceptualization, Data curation, Formal analysis, Investigation, Methodology, Project administration, Resources, Software, Validation, Visualization, Writing – original draft, Writing – review & editing

* E-mail: [email protected] , [email protected]

Affiliation School of Business, Faculty of Business, Education, Law and Arts, University of Southern Queensland, Toowoomba, Australia

Roles Conceptualization, Formal analysis, Supervision, Writing – review & editing

Roles Conceptualization, Supervision, Writing – review & editing

Roles Conceptualization, Data curation, Formal analysis, Methodology, Supervision, Writing – review & editing

Avishek Khanal,
Mohammad Mafizur Rahman,
Rasheda Khanam,
Eswaran Velayutham

Published: August 8, 2022
https://doi.org/10.1371/journal.pone.0270772
Peer Review
Reader Comments

Workers’ living standards have recently deteriorated in the service sector throughout the world, although a few decades ago, service was among the fastest growing sectors in industrialised nations. However, in recent years, in service sectors tourism especially has been drying up. This paper examines the symmetric and asymmetric effects of tourism, market capital, financial development, and trade on service sector employment in Australia from the period 1991–2019. The results of the cointegration tests, notably the ARDL and NARDL bound tests, reveal that the variables are related in the long run. The positive effect of tourist arrival on service sector employment in Australia is confirmed by long-run estimates from both ARDL and NARDL approaches. Similarly, both approaches also confirm the long-run positive relation of financial development. However, while ARDL shows long-run negative and positive associations of market capital and trade, respectively, the opposite is found in the case of the NARDL approach. As a result, policy proposals like planning and initiating tools for ensuring consistent international arrivals and easing of entry requirements have been recommended by this study to assist Australia in enhancing service sector employment, thus promoting economic development.

Citation: Khanal A, Rahman MM, Khanam R, Velayutham E (2022) The role of tourism in service sector employment: Do market capital, financial development and trade also play a role? PLoS ONE 17(8): e0270772. https://doi.org/10.1371/journal.pone.0270772

Editor: Ricky Chee Jiun Chia, Universiti Malaysia Sabah, MALAYSIA

Received: February 22, 2022; Accepted: June 16, 2022; Published: August 8, 2022

Copyright: © 2022 Khanal et al. This is an open access article distributed under the terms of the Creative Commons Attribution License , which permits unrestricted use, distribution, and reproduction in any medium, provided the original author and source are credited.

Data Availability: All datas are available from the WDI world bank database ( https://datacatalog.worldbank.org/dataset/world-development-indicators ).

Funding: The authors received no specific funding for this work.

Competing interests: The authors have declared that no competing interests exist.

Introduction

The industrial revolution strengthened manufacturing units by easing and enhancing the volume of production, and thus the manufacturing sector is known as the engine of growth. However, over time, the contribution of manufacturing sectors globally has constantly been declining in terms of national income and employment, while the contribution of the service industry has been increasing. The service sector in an economy includes diverse industries and accounts for a substantial contribution to the country’s growth and development. In developed countries, the service sector accounts for around 70% of the gross domestic product (GDP), while according to an earlier estimate, around 79% of Australia’s economic activities were from the service sector [ 1 ]. Service sector employment in Australia was 78.4% in 2019, a decline from 85% in 2006, and an increase from 76% in 1985, indicating a fluctuation in sectoral employment [ 1 ]. Australia’s key services include education and tourism, recreational trade, FinTech and environmental services, while the most significant service exports are professional services, and business travel services [ 1 ].

Although workers’ living standards deteriorated in a service economy, a few decades ago service was among the fastest growing sectors in industrialised nations [ 2 , 3 ]. The argument Fuchs [ 4 ] made long back that economic development contributed to the rise of service employment seems valid today since higher family income influences more spending on various services.

Tourism dynamics are not confined to a particular area. Although Europe attracted many visitors in 2014, the Asia Pacific and Africa have enjoyed the highest growth during the decade that ended 2014 [ 5 ]. International tourism directly impacts both the economy and employment [ 5 , 6 ]. Tourism has attracted researchers to find its association with numerous factors and determinants, including emission and environment [ 7 ], energy consumption [ 8 ], foreign exchange rate [ 9 ], and economic development [ 10 ]. The tourism industry is predominantly resource-based and is influenced by the climate and landscape of the destination, heritage, and cuisine. Performance of the labour-intensive industries, including hotels, transports, and restaurants, amplifies the potential travellers’ motivation [ 6 ]. The hotel, transport, and other facilities use energy consumption which impacts the environment [ 11 , 12 ].

Despite such advancement in research, evidence about the service industry, employment, and related factors is inadequate, particularly from the Australian perspective, while this sector can potentially influence growth [ 13 – 15 ]. Against this backdrop, this research aims to investigate the influences of tourist arrival, market capital, financial development, and volume of trade on service sector employment in Australia. The research findings are likely to contribute to the existing body of literature in two ways: first, by compiling seemingly different determinants in the analysis of employment in the service sector, as this research acknowledges the importance of various service-oriented industries. Second, using an established dataset to recognise the impact of multiple service industries on service sector employment as this is not readily available in the existing literature.

Background and literature review

Sectoral shifts in employment over time are viewed as structural transformation [ 16 ], and this field of research has gained attraction. For instance, in the Chinese context, Wang and Zhang [ 17 ] found that better transportation infrastructure results in employment density in the service sectors. They also found that road transportation promoted service sector employment more than railway and inland water transport. Walmsley, Koens and Milano [ 18 ] have found that overtourism, excessive numbers of tourists in a particular tourist spot, has the potential to impact wage and to divide labor market. In the Indian context, R&D, legal, media and broadcasting services have all been identified as potential sectors for future growth [ 19 ]. Education, health, growth in population, and inflation positively influence service sector employment, while the impact of political conflict is the reverse, as found in Nepal [ 20 ]. Nonetheless, the impact of various service-oriented industries on this sectoral employment is rarely investigated.

The travel and tourism industry plays a vital role in the global economy. In 2010, more than 235 million employees were linked to this sector. Later, although it was with a minor decline in 2008–09, it grew consistently until the end of 2019, when COVID impacted the whole world. According to International Labour Organisation (ILO), tourism was expected to grow around nine per cent of total GDP [ 21 ] but tourism has been one of the sectors that is most harshly impacted from the spread of COVID-19. During the harshest impact of COVID-19, many sectors including tourism were subject to restrictions and anti-pandemic measures due to their higher potential to spread COVID-19 [ 22 ]. However, during post-COVID investigation, Scarlett [ 23 ] found that tourism has a significant positive impact on economic growth. The author has also found that a relative increase in tourism to GDP is likely to positively impact FDI inflow. In Australia, the Australian Bureau of Statistics (ABS) confirmed that since September 2020, only three months (from May to July 2021) have welcomed more than 60 thousand overseas arrivals, while some months have seen 20–40 thousand arrivals [ 24 ]. Tourism-dependent nations, particularly the small island developing states (SIDS), experience a higher proportion of employment in the service industry. In the case of a decline in tourism, substantial migrated labour and a small proportion of indigenous labour can be found redundant as was the case in Malaysia from 2007 to 2009 [ 6 ]. Hence, it is assumed that a boom or recession in tourism impacts employment in the sector, and an inferential statistical analysis is likely to provide a piece of evidence. Fig 1 shows the upward increasing trend of tourist arrivals and employment in services (% of total employment) (modeled ILO estimate).

PPT PowerPoint slide
PNG larger image
TIFF original image

Source: World Bank [ 25 ].

https://doi.org/10.1371/journal.pone.0270772.g001

Concerning the contribution or impact of the stock market on economic development, many investigations have been conducted across the world, for instance, in Belgium [ 26 ], in parts of Africa [ 27 ], and in many developing countries [ 28 ]. It has been found that a structured stock market in the long run results in the economic growth of a country [ 27 ], and stock market-based funding is a determinant of economic growth [ 26 ]. Irani, Katircioglu and Gokmenoglu [ 29 ] have found that the tourism stock price is impacted by foreign tourist arrivals and the price is more sensitive to changes in tourist arrival. Growth in the service sector as well eventually impacts the sustained growth of an economy [ 30 ]. However, the influence of the structured and the developed stock market on service sector employment in general and from the Australian perspective is an underexplored area of research.

Among many other indicators, the volume and quality of domestic credit to the private sector is also an indicator of an increase in investment and financial development [ 31 – 34 ]. Isaeva et al. [ 35 ] argue that higher receipts from tourism result in a higher share of domestic credit to private sector and vice versa. Moreover, well-structured financial systems enhance the tourism development of a nation [ 35 ]. However, other studies have ascertained that domestic credit may not boost economic growth [ 36 , 37 ]. Many researchers across the world have investigated the causal relationship between economic growth and domestic credit, for instance, China [ 38 ], Kenya [ 39 ], Tunisia [ 40 ], and Brazil, Russia, India, China, and South Africa (BRICS) [ 41 ]. In addition, domestic credit has also been investigated for trade [ 42 ]. Yousaf et al. [ 43 ] have found that board capital positively impacts the performance of tourism service providers. In the context of the Gulf region, tourism sectors are found to rely more on short-term than long-term debt [ 44 ]. However, a causal relationship regarding service sector employment, particularly focusing on Australia, is under explored.

The other variable considered for this research is trade, which generally results in employment and income in the global economy [ 45 ]. In 2005, more than 70% of the industrialised nations’ employment was in a service sector consisting mostly of non-tradable activity [ 46 ]. Trade policies impact employment, labour market institutions, and policies. While trade and trade liberalisation may be the reason for company closures and thereby job losses in one part, start-ups or new firms start to commence operations in other parts of an economy requiring more labour [ 46 , 47 ]. Hence, trade policies have attracted numerous researchers in the last couple of decades. However, most researchers concentrated on manufacturing employment [ 46 ], and provided sufficient reasons for further studies to focus on service sector employment. Trade, in general, results in employment and income in the global economy. Trade policies impact employment, labour market institutions and policies. While trade and trade liberalisation are the reason for company closures and thereby job losses in one part, start-ups or new firms start to operate in other parts of an economy requiring more labour [ 46 , 47 ]. Ehigiamusoe [ 48 ] has identified that the individual causality between tourism and growth shows a bidirectional connection. It is also found that tourism is a significant predictor of financial development and economic growth [ 48 ].

In one of the earlier studies, Armah [ 49 ] showed varied trade-related employment gains with the proportion of women the minority of labour. A recent investigation identified that volume of service exports plays a pivotal role to optimise service sector employment, particularly in the case of China [ 50 ]. Trade openness and other variables positively affect sectoral shift towards service industries [ 51 ]. In the German context, service sector employment has grown while manufacturing jobs are declining; however, these were not attributed to the rising trade with other nations [ 52 ]. In the case of Cambodia, trade shock was found to impact different manufacturing industries differently, while there was no impact on the informal sector [ 53 ].

There are at least two reasons identified by Kelle and Kleinert [ 54 ] for the growing importance of service trade: service is becoming increasingly vital in modern economies, and technological advancement has made service increasingly tradable. In the case of Australia, a limited volume of trade involves the advanced producer services sector, which is well proportioned [ 55 ]. The absence of suitable host conditions is a reason for such low volume. The services sector in Australia employs 80% of Australians and accounts for more than 70% of GDP. According to Australian Government’s department of foreign affairs and trade (DFAT), the involvement of international service trade with countries resulted in around 22% of total exports in 2016 [ 56 ].

Dignity in the tourism industry is another field that has attracted numerous researchers. Tourism employment has resulted in violation of dignity of indigenous people [ 57 ]. Tourism and sustainability nexus has become another dimension in the recent literature, while it has been argued that research should be carried out on the integration of work and workers focusing dignity [ 58 ]. Tosun et al. [ 59 ] argued that in the developing world considering tourism as a developmental instrument and thereby benefitting from it would be difficult. However, in the perspective of develop world, the condition may be different.

Data and methodology

The study examined the association of international tourism in Australia and service sector employment. In addition, to avoid omitted variable bias, some additional explanatory variables i.e., market capital (listed domestic companies in current US$), financial development (domestic credit to the private sector as a percentage of GDP) and trade (percentage of GDP) were also incorporated. The data extracted in this paper was created from time series observation in Australia from 1991 to 2019. All the data were collected from World Development Indicators (WDI) [ 25 ]. The data source and variables description are presented in Table 1 .

https://doi.org/10.1371/journal.pone.0270772.t001

Empirical model

The following model has been developed to assess the effect of tourist arrival, market capital, and financial development on service sector employment in Australia following Rahman, Shahbaz and Farooq [ 45 ].

Where ε t is the error term, while LN EMP t , LN TA t , LN MC t, , and LN FD t are the natural logarithms of employment in the service sector, tourist arrivals, market capital and financial development, respectively. This study used the logarithmic forms of the variables of interest to stabilise the variance of the series [ 60 ].

Unit root test

The stationarity of time-series data is important since the results of causality tests rely on it, and macroeconomic variables frequently have a unit root. If the first and second moments of a stochastic process are time-invariant, the process is said to be stationary in which statistical qualities do not change [ 61 ].

If a variable’s first difference is stationary, it is integrated of order I(1) [ 62 , 63 ]. The auxiliary equation below was taken from Lütkepohl, Krätzig and Phillips [ 61 ].

Where it denotes the relevant time-series variable, t denotes a linear deterministic trend, Δ is the first difference operator, ∝ i denotes the parameter of interest, k denotes the maximum lag order, and ε t denotes the error term. If |∝i | < 1, the series is trend stationary; conversely, when |∝i | ⩾ 1, the series has the unit root and is thus not stationary. For more information on the time-series unit root test, see here. For further information on the time-series unit root test, see Hamilton [ 64 ] and Lütkepohl, Krätzig and Phillips [ 61 ].

The BDS test compares the null hypothesis that the data is distributed independently and identically (iid) to an unspecified alternative [ 65 ]. Its null hypothesis is that data in a time series is linearly dependent. The test is unique because it can determine non-linearities without being influenced by linear data dependencies. The BDS test is a two-tailed test, and the null hypothesis is rejected if the BDS test statistic is greater than or less than the critical values (e.g. if a = 0.05, the critical value = ±1.96).

Cointegration analysis

This study utilised the Pesaran cointegration test, namely the autoregressive distributed lag (ARDL) bound test, to explore the long run and short run association among the dependent and explanatory variables, [ 66 ]. However, because of the possible asymmetric association among the variables, this study also used a nonlinear autoregressive distributed lag (NARDL) model developed by Shin, Yu and Greenwood-Nimmo [ 67 ].

The symmetric analysis: ARDL bound testing technique.

The paper also uses the cointegration technique developed by Pesaran, Shin and Smith [ 66 ], particularly the ARDL bound test. The ARDL approach has gained popularity among scientists due to its benefits compared to other standard cointegration methods for identifying the symmetric association of service sector employment and other explanatory factors [ 68 – 70 ].

Where p is the lag length, β 0 is constant and ε t indicates the white noise error term. While β 1 to β 5 and α 1 is α 5 represented the long- and short-term dynamic, respectively. We investigated the long-run relationship between the series after getting the F-statistic value using the ARDL bound testing equation. The following hypotheses for the model were used to determine the long-run relationship between variables:

H0: β 1 = β 2 = β 3 = β 4 = β 5= 0 (no cointegration)
H0: β 1 ≠ β 2 ≠ β 3 ≠ β 4 ≠ β 5≠ 0 (cointegration)

We ran the long-run and short-run dynamics if there was cointegration identified among the variables that are H0: β1, β2, β3, β4, β5, β6 ≠0.

The following equations specify the long-run and short-run models of the ARDL specification:

Where β and α is the long run and short run dynamics coefficient, respectively; while μ is the coefficient of the speed of adjustment and ε t is the disturbance term.

The asymmetric analysis: NARDL.

The study represented the descriptive statistics and correlations of the variables, as shown in Table 2 . According to Jarque–Bera statistics, the series of employment, tourism arrivals, market capital, financial development, and trade are normally distributed. The low standard deviation values for all variables indicate that the data are spread around the mean rather than widely dispersed, validating the normal distribution results as determined by Jarque–Bera values.

https://doi.org/10.1371/journal.pone.0270772.t002

The study exhibited the ADF unit root test to determine the order of integration, whether the study’s variables were stationary at the first difference I (1). The result of ADF in Table 3 shows that all the variables were stationary at first difference I (1). Hence, the series of variables is shown to have a valid long-run relationship.

https://doi.org/10.1371/journal.pone.0270772.t003

BDS test results

Table 4 illustrates the result of the BDS test for non-linearity. For all levels, P-value is found to be less than 0.05, thus the null hypothesis is rejected, implying that the series are linearly dependent. The results suggest that Australia’s employment, tourism arrivals, market capital, financial development, and trade are non-linearly dependent.

https://doi.org/10.1371/journal.pone.0270772.t004

Bound testing results

The study employed the ARDL bound test to examine the association between variables. As shown in Table 5 , the F-statistics in the bound test is larger than 5% critical value, showing that the null hypothesis of no level relationship is rejected at the significance level. This indicates a cointegration relationship between variables at least at 1% significance level. Therefore, the result allows us to apply the ARDL and NARDL cointegration approaches. The implementation of cointegration across variables allows us to examine the impact of tourist arrival, market capital, financial development and trade on service sector employment in the short and long run.

https://doi.org/10.1371/journal.pone.0270772.t005

Long-run results

In the long run ARDL model, outlined in Table 6 , it is evident that that tourist arrivals affect service sector employment significantly and positively. With 1% growth in tourist arrivals, employment in the service sector increases by 0.037%. As for an asymmetric TA-EMP linkage, the NARDL model shows that a positive shock in TA (LNTA+) increases employment in the service sector while a negative shock TA (LNTA-) reduces employment. Market capital significantly and negatively affects service sector employment in a symmetric linear model (ARDL); however, in the asymmetric model (NARDL), positive shock in MC (LNMC + ) can lead to an increase in employability in the long run. In the long run, the symmetric ARDL model both financial development and trade, show a significant positive impact on service sector employment while no significant and negative association is found for financial development and trade, respectively, in the NARDL model.

https://doi.org/10.1371/journal.pone.0270772.t006

Short-run results

The short-run linear (ARDL) and non-linear (NARDL) dynamics are presented in Table 7 . In the short run, linear (ARDL) dynamics revealed that tourist arrival, market capital, and trade volume exposed a statistically significant positive coefficient of 0.095, 0.005 and 0.041. However, financial development showed a negative coefficient -0.013. As for asymmetric EMP- tourist arrival linkage, while a positive shock in TA (ΔLNTA + ) increases employment, a negative shock in tourist arrival decreases employment in the service sector. A positive shock in MC can increase service sector employment in the short run; however, no significant association is found if there is any negative shock.

https://doi.org/10.1371/journal.pone.0270772.t007

Diagnostic tests

As shown in Table 8 , diagnostic tests were used to assess the estimates’ reliability. The diagnostic tests using the log transformation of time-series data are shown in the table. The Breusch-Godfrey Lagrange multiplier test found no serial connection, indicating unrelated observations. The Breusch-Pagan-Godfrey heteroscedasticity test demonstrated that the observation had no regression errors. The series was shown to be normally distributed by the Jarque-Bera normality test, and finally, the Ramsey RESET stability test confirmed the model as correctly specified.

https://doi.org/10.1371/journal.pone.0270772.t008

Stability test

The CUSUM and CUSUM of squares tests on the recursive residuals are used in this paper to assess the consistency of short-run beta coefficients in the ARDL method. The CUSUM test identifies orderly fluctuations in regression coefficients, whereas the CUSUM squares test identifies rapid fluctuations in regression coefficients that may change their stability. Figs 2 and 3 display the CUSUM and CUSUM square test results, indicating that all values were within the critical boundaries at a 5% significant level.

https://doi.org/10.1371/journal.pone.0270772.g002

https://doi.org/10.1371/journal.pone.0270772.g003

Dynamic multiplier graph

A dynamic multiplier graph for NARDL is presented in Figs 4 and 5 to analyse the adjustment of asymmetry in the existing long-run equilibrium after passing to a new long-run equilibrium due to negative and positive shocks. The asymmetry curves depict a linear mixture of dynamic multipliers resulting from positive and negative shocks of tourist arrival and market capital.

https://doi.org/10.1371/journal.pone.0270772.g004

https://doi.org/10.1371/journal.pone.0270772.g005

The present study aimed to investigate the symmetric and asymmetric relationship of service sector employment with tourist arrival, market capital, financial development, and international trade in Australia. To check the stationarity of the variables, the ADF unit root was implemented. In addition, the ARDL bound testing approach was used to check the symmetric dynamic linkage among the variables, while NARDL bound testing was implemented to investigate the asymmetric dynamic linkages. Tourist arrival, financial development and trade were found to be positively cointegrated; however, market capital showed an inverse association with service sector employment in the long run ARDL dynamics. A long run asymmetric NARDL relationship reaffirmed the service sector employment and tourist arrival linkage, while a positive shock in TA increased employment, and a negative shock decreased employment in the service sector. In addition, in the long run NARDL dynamics, trade was found to be negatively cointegrated with employability in the service sector.

This study finds a significant positive short and long-run effect between tourist arrival and service sector employment in Australia. This finding is consistent with similar studies conducted in Pakistan [ 70 ], India [ 71 ], and Africa [ 5 ], in all of which it has been observed that international tourism directly impacts the economy and therefore employment. Tourism is a critical component of the service industry since it contributes to the development of hotels, restaurants, transportation, and other associated services [ 70 ]. Thus, tourism contributes to the economy by creating jobs and boosting GDP [ 71 ]. Tourism has had a large indirect impact on economic development, contributing to the market, improving human living standards, raising government revenue through income and taxation, and even expanding the production of goods and services in Hong Kong, in addition to its direct benefits [ 72 ].

Furthermore, this study explored the relationship between market capital and employability in the service sector and found a negative association in ARDL long-run dynamics. Notably, no existing studies have previously used Australian data; therefore, this is the first study to conclude that tourism affects service sector employment in Australia. However, a study conducted on nine European countries found that a fall in capital stock increased overall unemployment [ 73 ]. In some other studies, the relationship between the stock market and economic growth has been analysed. For example, a structured stock market has been found to result in a country’s economic growth in the long run, and stock market-based finance is a determinant of economic growth [ 26 , 27 ]. The possible explanation of the negative relationship between market capital and service sector employment in Australia might be due to the difference in volume of stocks in manufacturing and service-oriented firms. The presence of banking and non-banking financial institutions and telecoms are dominant in various stock exchanges, while the contribution of other service-oriented industries is insignificant. Hence, the rise in market capital is more clearly linked with the entrance of the manufacturing industry in the stock market; thus, employability increase in this sector is more likely.

Financial development was found to affect service sector employment positively in Australia. Although earlier studies in Australia explored the dynamic, positive relationship between financial development and economic growth [ 45 , 74 ], research focused on financial development impact on service sector employment was limited. It is expected that since financial development affects economic growth, the service sector, which is a part of GDP, will also increase.

The findings of this study, concerning trade, is aligned with the findings of Jansen and Lee [ 46 ] and Vandenberg [ 47 ] in which a bidirectional impact of trade on employment was found. However, employment in the service sector requires explicitly further investigation. Concerning service sector employment, the case of Australia is somehow similar to the case of China as found by Yu and Meng [ 50 ]. Inter-country trade, as found in the case of Germany, does not influence the rise of service sector employment [ 52 ], which may remain true for Australia; however, it also requires further investigation.

Conclusion and policy implications

This study examined the symmetric and asymmetric relationships of tourist arrival, market capital, financial development and international trade with Australian service sector employment using annual data from 1991 to 2019. Unlike prior research on Australia, this was among the primary attempts to separately examine the impact of the mentioned variables on service sector employment separately. The linear ARDL results imply that tourist arrival, financial development and trade has a long-term positive effect on service sector employment, whereas market capital negatively affects service sector employment in Australia. However, the NARDL results show that a rise in tourist arrival intensifies service sector employment in the long run, whereas a fall shrinks employability. Further investigations may be conducted to assess the impact of inter-country trade, especially with the countries from Asia and the Pacific countries.

Based on the findings, a few policy recommendations are suggested. The government should plan and initiate tools to ensure consistent tourist arrivals throughout the year to keep service sector employment predictable. Reduction of visa restrictions and/or easing entry requirements may be some initiatives to promote tourist arrivals. In addition, credit towards the service industry, especially in tourism sector, should be supported since domestic credit to private sectors results in higher service sector employment [ 35 ]. The national government should also promote service exports to other countries to enjoy a higher level of employment in overall service sector. Proper attention should be given for financial development as it can positively contribute to employment level. The federal government should also ensure the dignity of the indigenous people. For all these measures, both short and long-term plans should be undertaken and executed carefully in Australia.

Acknowledgments

This paper uses the data from World Development Indicators from World Bank. The authors would like to thank World Bank for providing the data. The authors also would like to thank Dr Barbara Harmes for proofreading the manuscript before submission.

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WORLD TRADE ORGANIZATION

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tourism and travel-related services

SERVICES: SECTOR BY SECTOR

Tourism and travel-related services

Tourism plays an important role for nearly all WTO members, especially in terms of its contribution to employment, GDP, and the generation of foreign exchange. Tourism-related services are typically labour-intensive, with numerous links to other major segments of the economy, such as transport, cultural and creative services, or financial and insurance services.

Tourism and travel-related services include services provided by hotels and restaurants (including catering), travel agencies and tour operator services, tourist guide services and other related services.

A crucial aspect of trade in tourism services is the cross-border movement of consumers (mode 2). This permits a variety of workers, including those in remote areas, to become services exporters — for instance, by guiding tourists, performing in local events, or working in tourist accommodation. While digitalisation offers great potential for many aspects of tourism services, the sector continues to depend highly on the cross-border movement of both customers and employees, and remains strongly linked to transport services.

Current commitments and exemptions

Tourism commitments have been undertaken by over 133 WTO members, more than in any other service sector. This indicates the desire of most members to expand their tourism sectors and to increase inward foreign direct investment (FDI) as part of their efforts to promote economic growth.

The level of commitments by sub-sector varies widely for tourism and travel-related services. Commitments on services provided by hotels and restaurants are the most frequent, with a significantly smaller number of WTO members making commitments on travel agencies and tour operator services. Only about half of members with commitments on tourism have included tourist guide services, and only a few members have made commitments for the “other” tourism services category.

Schedules of WTO Members with Specific Commitments on Tourism Services

Treatment of the sector in negotiations

Tourism services, like other services covered by the General Agreement on Trade in Services (GATS), were included in the services negotiations that began in 2000.

One of the earliest documents was a proposal for a GATS Annex on Tourism, originally sponsored by the Dominican Republic, El Salvador and Honduras ( S/C/W/127 and S/C/W/127/Corr.1 ). The proposal had two main aspects: more comprehensive treatment of the tourism sector (with respect to classification issues), and the prevention of anti-competitive practices. As part of the plurilateral process, a joint request was made by a group of developing countries, asking for improved tourism commitments for all modes of supply.

Proposals and related negotiating documents on tourism services

Additional information

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World Travel and Tourism Council (WTTC)
OECD Tourism Unit (Centre for Entrepreneurship, SMEs, Regions and Cities)

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Reimagining the $9 trillion tourism economy—what will it take?

Tourism made up 10 percent of global GDP in 2019 and was worth almost $9 trillion, 1 See “Economic impact reports,” World Travel & Tourism Council (WTTC), wttc.org. making the sector nearly three times larger than agriculture. However, the tourism value chain of suppliers and intermediaries has always been fragmented, with limited coordination among the small and medium-size enterprises (SMEs) that make up a large portion of the sector. Governments have generally played a limited role in the industry, with partial oversight and light-touch management.

COVID-19 has caused an unprecedented crisis for the tourism industry. International tourist arrivals are projected to plunge by 60 to 80 percent in 2020, and tourism spending is not likely to return to precrisis levels until 2024. This puts as many as 120 million jobs at risk. 2 “International tourist numbers could fall 60-80% in 2020, UNWTO reports,” World Tourism Organization, May 7, 2020, unwto.org.

Reopening tourism-related businesses and managing their recovery in a way that is safe, attractive for tourists, and economically viable will require coordination at a level not seen before. The public sector may be best placed to oversee this process in the context of the fragmented SME ecosystem, large state-owned enterprises controlling entry points, and the increasing impact of health-related agencies. As borders start reopening and interest in leisure rebounds in some regions , governments could take the opportunity to rethink their role within tourism, thereby potentially both assisting in the sector’s recovery and strengthening it in the long term.

In this article, we suggest four ways in which governments can reimagine their role in the tourism sector in the context of COVID-19.

1. Streamlining public–private interfaces through a tourism nerve center

Before COVID-19, most tourism ministries and authorities focused on destination marketing, industry promotions, and research. Many are now dealing with a raft of new regulations, stimulus programs, and protocols. They are also dealing with uncertainty around demand forecasting, and the decisions they make around which assets—such as airports—to reopen will have a major impact on the safety of tourists and sector employees.

Coordination between the public and private sectors in tourism was already complex prior to COVID-19. In the United Kingdom, for example, tourism falls within the remit of two departments—the Department for Business, Energy, and Industrial Strategy (BEIS) and the Department for Digital, Culture, Media & Sport (DCMS)—which interact with other government agencies and the private sector at several points. Complex coordination structures often make clarity and consistency difficult. These issues are exacerbated by the degree of coordination that will be required by the tourism sector in the aftermath of the crisis, both across government agencies (for example, between the ministries responsible for transport, tourism, and health), and between the government and private-sector players (such as for implementing protocols, syncing financial aid, and reopening assets).

Concentrating crucial leadership into a central nerve center is a crisis management response many organizations have deployed in similar situations. Tourism nerve centers, which bring together public, private, and semi-private players into project teams to address five themes, could provide an active collaboration framework that is particularly suited to the diverse stakeholders within the tourism sector (Exhibit 1).

We analyzed stimulus packages across 24 economies, 3 Australia, Bahrain, Belgium, Canada, Egypt, Finland, France, Germany, Hong Kong, Indonesia, Israel, Italy, Kenya, Malaysia, New Zealand, Peru, Philippines, Singapore, South Africa, South Korea, Spain, Switzerland, Thailand, and the United Kingdom. which totaled nearly $100 billion in funds dedicated directly to the tourism sector, and close to $300 billion including cross-sector packages with a heavy tourism footprint. This stimulus was generally provided by multiple entities and government departments, and few countries had a single integrated view on beneficiaries and losers. We conducted surveys on how effective the public-sector response has been and found that two-thirds of tourism players were either unaware of the measures taken by government or felt they did not have sufficient impact. Given uncertainty about the timing and speed of the tourism recovery, obtaining quick feedback and redeploying funds will be critical to ensuring that stimulus packages have maximum impact.

2. Experimenting with new financing mechanisms

Most of the $100 billion stimulus that we analyzed was structured as grants, debt relief, and aid to SMEs and airlines. New Zealand has offered an NZ $15,000 (US $10,000) grant per SME to cover wages, for example, while Singapore has instituted an 8 percent cash grant on the gross monthly wages of local employees. Japan has waived the debt of small companies where income dropped more than 20 percent. In Germany, companies can use state-sponsored work-sharing schemes for up to six months, and the government provides an income replacement rate of 60 percent.

Our forecasts indicate that it will take four to seven years for tourism demand to return to 2019 levels, which means that overcapacity will be the new normal in the medium term. This prolonged period of low demand means that the way tourism is financed needs to change. The aforementioned types of policies are expensive and will be difficult for governments to sustain over multiple years. They also might not go far enough. A recent Organisation for Economic Co-operation and Development (OECD) survey of SMEs in the tourism sector suggested more than half would not survive the next few months, and the failure of businesses on anything like this scale would put the recovery far behind even the most conservative forecasts. 4 See Tourism policy responses to the coronavirus (COVID-19), OECD, June 2020, oecd.org. Governments and the private sector should be investigating new, innovative financing measures.

Revenue-pooling structures for hotels

One option would be the creation of revenue-pooling structures, which could help asset owners and operators, especially SMEs, to manage variable costs and losses moving forward. Hotels competing for the same segment in the same district, such as a beach strip, could have an incentive to pool revenues and losses while operating at reduced capacity. Instead of having all hotels operating at 20 to 40 percent occupancy, a subset of hotels could operate at a higher occupancy rate and share the revenue with the remainder. This would allow hotels to optimize variable costs and reduce the need for government stimulus. Non-operating hotels could channel stimulus funds into refurbishments or other investment, which would boost the destination’s attractiveness. Governments will need to be the intermediary between businesses through auditing or escrow accounts in this model.

Joint equity funds for small and medium-size enterprises

Government-backed equity funds could also be used to deploy private capital to help ensure that tourism-related SMEs survive the crisis (Exhibit 2). This principle underpins the European Commission’s temporary framework for recapitalization of state-aided enterprises, which provided an estimated €1.9 trillion in aid to the EU economy between March and May 2020. 5 See “State aid: Commission expands temporary framework to recapitalisation and subordinated debt measures to further support the economy in the context of the coronavirus outbreak,” European Commission, May 8, 2020, ec.europa.eu. Applying such a mechanism to SMEs would require creating an appropriate equity-holding structure, or securitizing equity stakes in multiple SMEs at once, reducing the overall risk profile for the investor. In addition, developing a standardized valuation methodology would avoid lengthy due diligence processes on each asset. Governments that do not have the resources to co-invest could limit their role to setting up those structures and opening them to potential private investors.

3. Ensuring transparent, consistent communication on protocols

The return of tourism demand requires that travelers and tourism-sector employees feel—and are—safe. Although international organizations such as the International Air Transport Association (IATA), and the World Travel & Tourism Council (WTTC) have developed a set of guidelines to serve as a baseline, local regulators are layering additional measures on top. This leads to low levels of harmonization regarding regulations imposed by local governments.

Our surveys of traveler confidence in the United States suggests anxiety remains high, and authorities and destination managers must work to ensure travelers know about, and feel reassured by, protocols put in place for their protection. Our latest survey of traveler sentiment in China suggests a significant gap between how confident travelers would like to feel and how confident they actually feel; actual confidence in safety is much lower than the expected level asked a month before.

One reason for this low level of confidence is confusion over the safety measures that are currently in place. Communication is therefore key to bolstering demand. Experience in Europe indicates that prompt, transparent, consistent communications from public agencies have had a similar impact on traveler demand as CEO announcements have on stock prices. Clear, credible announcements regarding the removal of travel restrictions have already led to increased air-travel searches and bookings. In the week that governments announced the removal of travel bans to a number of European summer destinations, for example, outbound air travel web search volumes recently exceeded precrisis levels by more than 20 percent in some countries.

The case of Greece helps illustrate the importance of clear and consistent communication. Greece was one of the first EU countries to announce the date of, and conditions and protocols for, border reopening. Since that announcement, Greece’s disease incidence has remained steady and there have been no changes to the announced protocols. The result: our joint research with trivago shows that Greece is now among the top five summer destinations for German travelers for the first time. In July and August, Greece will reach inbound airline ticketing levels that are approximately 50 percent of that achieved in the same period last year. This exceeds the rate in most other European summer destinations, including Croatia (35 percent), Portugal (around 30 percent), and Spain (around 40 percent). 6 Based on IATA Air Travel Pulse by McKinsey. In contrast, some destinations that have had inconsistent communications around the time frame of reopening have shown net cancellations of flights for June and July. Even for the high seasons toward the end of the year, inbound air travel ticketing barely reaches 30 percent of 2019 volumes.

Digital solutions can be an effective tool to bridge communication and to create consistency on protocols between governments and the private sector. In China, the health QR code system, which reflects past travel history and contact with infected people, is being widely used during the reopening stage. Travelers have to show their green, government-issued QR code before entering airports, hotels, and attractions. The code is also required for preflight check-in and, at certain destination airports, after landing.

4. Enabling a digital and analytics transformation within the tourism sector

Data sources and forecasts have shifted, and proliferated, in the crisis. Last year’s demand prediction models are no longer relevant, leaving many destinations struggling to understand how demand will evolve, and therefore how to manage supply. Uncertainty over the speed and shape of the recovery means that segmentation and marketing budgets, historically reassessed every few years, now need to be updated every few months. The tourism sector needs to undergo an analytics transformation to enable the coordination of marketing budgets, sector promotions, and calendars of events, and to ensure that products are marketed to the right population segment at the right time.

Governments have an opportunity to reimagine their roles in providing data infrastructure and capabilities to the tourism sector, and to investigate new and innovative operating models. This was already underway in some destinations before COVID-19. Singapore, for example, made heavy investments in its data and analytics stack over the past decade through the Singapore Tourism Analytics Network (STAN), which provided tourism players with visitor arrival statistics, passenger profiling, spending data, revenue data, and extensive customer-experience surveys. During the COVID-19 pandemic, real-time data on leading travel indicators and “nowcasts” (forecasts for the coming weeks and months) could be invaluable to inform the decisions of both public-sector and private-sector entities.

This analytics transformation will also help to address the digital gap that was evident in tourism even before the crisis. Digital services are vital for travelers: in 2019, more than 40 percent of US travelers used mobile devices to book their trips. 7 Global Digital Traveler Research 2019, Travelport, marketing.cloud.travelport.com; “Mobile travel trends 2019 in the words of industry experts,” blog entry by David MacHale, December 11, 2018, blog.digital.travelport.com. In Europe and the United States, as many as 60 percent of travel bookings are digital, and online travel agents can have a market share as high as 50 percent, particularly for smaller independent hotels. 8 Sean O’Neill, “Coronavirus upheaval prompts independent hotels to look at management company startups,” Skift, May 11, 2020, skift.com. COVID-19 is likely to accelerate the shift to digital as travelers look for flexibility and booking lead times shorten: more than 90 percent of recent trips in China were booked within seven days of the trip itself. Many tourism businesses have struggled to keep pace with changing consumer preferences around digital. In particular, many tourism SMEs have not been fully able to integrate new digital capabilities in the way that larger businesses have, with barriers including language issues, and low levels of digital fluency. The commission rates on existing platforms, which range from 10 percent for larger hotel brands to 25 percent for independent hotels, also make it difficult for SMEs to compete in the digital space.

Governments are well-positioned to overcome the digital gap within the sector and to level the playing field for SMEs. The Tourism Exchange Australia (TXA) platform, which was created by the Australian government, is an example of enabling at scale. It acts as a matchmaker, connecting suppliers with distributors and intermediaries to create packages attractive to a specific segment of tourists, then uses tourist engagement to provide further analytical insights to travel intermediaries (Exhibit 3). This mechanism allows online travel agents to diversify their offerings by providing more experiences away from the beaten track, which both adds to Australia’s destination attractiveness, and gives small suppliers better access to customers.

Government-supported platforms or data lakes could allow the rapid creation of packages that include SME product and service offerings.

Governments that seize the opportunity to reimagine tourism operations and oversight will be well positioned to steer their national tourism industries safely into—and set them up to thrive within—the next normal.

Download the article in Arabic (513KB)

Margaux Constantin is an associate partner in McKinsey’s Dubai office, Steve Saxon is a partner in the Shanghai office, and Jackey Yu is an associate partner in the Hong Kong office.

The authors wish to thank Hugo Espirito Santo, Urs Binggeli, Jonathan Steinbach, Yassir Zouaoui, Rebecca Stone, and Ninan Chacko for their contributions to this article.

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The role of tourism in service sector employment: Do market capital, financial development and trade also play a role?

Avishek Khanal

School of Business, Faculty of Business, Education, Law and Arts, University of Southern Queensland, Toowoomba, Australia

Mohammad Mafizur Rahman

Rasheda khanam, eswaran velayutham, associated data.

All datas are available from the WDI world bank database ( https://datacatalog.worldbank.org/dataset/world-development-indicators ).

Introduction

Background and literature review

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Object name is pone.0270772.g001.jpg

Source: World Bank [ 25 ].

Data and methodology

Empirical model

Unit root test

If a variable’s first difference is stationary, it is integrated of order I(1) [ 62 , 63 ]. The auxiliary equation below was taken from Lütkepohl, Krätzig and Phillips [ 61 ].

Cointegration analysis

The symmetric analysis: ARDL bound testing technique

The bound test provides two asymptotic critical values when the independent variables are I (0) or I (1). If the F-statistic value is greater than the upper critical bound, I (1), it can be concluded that the variables are cointegrated and that there is a long-run relationship among them. The empirical expression of the ARDL bound test for cointegration is presented as follows:

H0: β 1 = β 2 = β 3 = β 4 = β 5= 0 (no cointegration)
H0: β 1 ≠ β 2 ≠ β 3 ≠ β 4 ≠ β 5≠ 0 (cointegration)

We ran the long-run and short-run dynamics if there was cointegration identified among the variables that are H0: β1, β2, β3, β4, β5, β6 ≠0.

The following equations specify the long-run and short-run models of the ARDL specification:

Where β and α is the long run and short run dynamics coefficient, respectively; while μ is the coefficient of the speed of adjustment and ε t is the disturbance term.

The asymmetric analysis: NARDL

This paper also employs the NARDL technique developed by Shin, Yu and Greenwood-Nimmo [ 67 ] to determine the probable asymmetric association among the variables ignored by the linear ARDL model. The NARDL model, like the ARDL model, has criteria for the integration order of the variables. Thus, the following Shin, Yu and Greenwood-Nimmo [ 67 ], Eq 3 can be restated in the following form:

From Eq 6 , β i + , β i − and [ ∑ i = 1 p θ i + ] , [ ∑ i = 1 p θ i − ] , captures the long- and short-run positive and negative impact of tourist arrival (TA) and market capital (MC) on service sector employment (EMP). Like the ARDL model, the bound test is restored to determine whether the variables are asymmetrically cointegrated or not. Furthermore, the Wald-test is used to assess the long (short-run) asymmetric linkage β = β + = β − (θ = θ + = θ − ) for both tourist arrival and market capital. The short-run asymmetric association can be provided via the dynamic multiplier effect in the following method, given the validation of the non-linear relationship.

s = 0, 1, 2, 3, …… …… nothing that s → ∞ , D S + = β 2 + , D S − = β 3 − ,

s = 0, 1, 2, 3, …… …… nothing that s → ∞ , D S + = β 4 + , D S − = β 5 −

Note: ***1% level of significance, ** 5% level of significance and * 10% level of significance.

BDS test results

***1% level of significance.

Bound testing results

***1% level of significance, LCB = Lower Critical Bound, and UCB = Upper Critical Bound

Long-run results

***1% level of significance

** 5% level of significance and

* 10% level of significance.

Short-run results

Diagnostic tests

Stability test

The CUSUM and CUSUM of squares tests on the recursive residuals are used in this paper to assess the consistency of short-run beta coefficients in the ARDL method. The CUSUM test identifies orderly fluctuations in regression coefficients, whereas the CUSUM squares test identifies rapid fluctuations in regression coefficients that may change their stability. Figs Figs2 2 and and3 3 display the CUSUM and CUSUM square test results, indicating that all values were within the critical boundaries at a 5% significant level.

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Object name is pone.0270772.g002.jpg

Dynamic multiplier graph

A dynamic multiplier graph for NARDL is presented in Figs Figs4 4 and and5 5 to analyse the adjustment of asymmetry in the existing long-run equilibrium after passing to a new long-run equilibrium due to negative and positive shocks. The asymmetry curves depict a linear mixture of dynamic multipliers resulting from positive and negative shocks of tourist arrival and market capital.

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Object name is pone.0270772.g004.jpg

Conclusion and policy implications

Acknowledgments

Funding Statement

The authors received no specific funding for this work.

Data Availability

PLoS One. 2022; 17(8): e0270772.

Decision Letter 0

PONE-D-22-05444The role of tourism in service sector employment: Do market capital, financial development and trade also play a role?PLOS ONE

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Reviewer #1: The study titled "The role of tourism in service sector employment: Do market capital, financial development and trade also play a role?" has been prepared in accordance with scientific rules. Thank you for giving me the opportunity to read and evaluate this work.

Reviewer #2: The study examined a very interesting subject using annual data from 1991 to 2019.

This topic is relevant from societal point of view.

The choice of statistical methods used in the study (ARDL, NARDL) is unique.

A full revision of the manuscipt is highly recommended for the following reasons:

1. The “2. Background and Literature Review” section is advised to be extended.

2. The topic considered (the role of tourism in service sector employment) has a large body of literature, and a thorough presentation of this literature would make the article more valuable. If the authors do not wish to extend the range of sources discussed, it is pertinent to define and justify those used more precisely.

3. Policy recommendations were suggested in section 6. (Conclusion and policy implications). I think these are not sufficiently substantiated and reasoned for.

4. Your proposals should be more specific.

5. A thorough proofreading is strongly recommended regarding grammatical errors and style.

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Author response to Decision Letter 0

16 Jun 2022

Response to Reviewers' Comments

1st June 2022

Editor-in-Chief

Re: Responses /Actions to the Reviewers’ Report on Ms. Ref. No.: PONE-D-22-05444

Title: The role of tourism in service sector employment: Do market capital, financial development and trade also play a role?

Dear Editor,

We are grateful to the respected editor for giving us an opportunity to revise and resubmit the paper. We think the comments are useful for further development of the paper. We have tried our level best to address all the comments of the reviewers in our revised manuscript. We believe our joint effort will enrich the paper in terms of quality. Thanks a lot, to the editor and the reviewers for your support, cooperation and valuable suggestions in the work. The Comments/Suggestions and our Responses/Actions are noted below for your consideration.

Response: Thank you very much for your nice comment and interest in reading our manuscript.

Reviewer #2: The study examined a very interesting subject using annual data from 1991 to 2019.

Response: Thank you very much for showing your interest in reading our manuscript.

Response: We have reviewed some recent literature to improve the section (See page# 4-8). Followings are the literatures we have added:

1. Camargo, B. A., Winchenbach, A., & Vázquez-Maguirre, M. (2022). Restoring the dignity of indigenous people: Perspectives on tourism employment. Tourism Management Perspectives, 41, 100946.

2. Ioannides, D., Gyimóthy, S., & James, L. (2021). From liminal labor to decent work: A human-centered perspective on sustainable tourism employment. Sustainability, 13(2), 851.

3. Tosun, C., Çalişkan, C., Şahin, S. Z., & Dedeoğlu, B. B. (2021). A critical perspective on tourism employment. Current Issues in Tourism, 1-21.

4. Walmsley, A., Koens, K., & Milano, C. (2021). Overtourism and employment outcomes for the tourism worker: impacts to labour markets. Tourism Review.

5. Sayan, S., & Alkan, A. (2021). A novel approach for measurement and decomposition of the economywide costs of shutting down tourism and related service sectors against COVID-19. Tourism Economics, 13548166211037100.

6. Scarlett, H. G. (2021). Tourism recovery and the economic impact: A panel assessment. Research in Globalization, 3, 100044.

7. Yousaf, U. B., Ullah, I., Wang, M., Junyan, L., & Rehman, A. U. (2021). Does board capital increase firm performance in the Chinese tourism industry?. Corporate Governance: The International Journal of Business in Society. DOI 10.1108/CG-04-2021-0165

8. Dalwai, T., & Sewpersadh, N. S. (2021). Intellectual capital and institutional governance as capital structure determinants in the tourism sector. Journal of Intellectual Capital.

9. Isaeva, A., Salahodjaev, R., Khachaturov, A., & Tosheva, S. (2022). The impact of tourism and financial development on energy consumption and carbon dioxide emission: Evidence from post-communist countries. Journal of the Knowledge Economy, 13(1), 773-786.

10. Ehigiamusoe, K. U. (2021). The nexus between tourism, financial development, and economic growth: Evidence from African countries. African Development Review, 33(2), 382-396.

11. Irani, F., Katircioglu, S., & Gokmenoglu, K. K. (2021). Effects of business and finance conditions on tourism firms’ financial performances: evidence from major tourist destinations. SAGE Open, 11(3), 21582440211040120.

Response: While addressing the section: Background and Literature Review, this suggestion has automatically been incorporated (See page# 4-8); Thanks to the reviewer for the suggestion.

Response: We have tried to link the suggestions with the findings of the research (See page# 19 last paragraph).

Response: We have included specific suggestions based on the findings of our research (See page# 19 last paragraph).

Response: Thanks reviewer for this suggestion. Language has been checked by native speaker and proof-reader.

Submitted filename: Response to Reviewers.docx

Decision Letter 1

17 Jun 2022

PONE-D-22-05444R1

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Fact sheet: 2022 national travel and tourism strategy, office of public affairs.

The 2022 National Travel and Tourism Strategy was released on June 6, 2022, by U.S. Secretary of Commerce Gina M. Raimondo on behalf of the Tourism Policy Council (TPC). The new strategy focuses the full efforts of the federal government to promote the United States as a premier destination grounded in the breadth and diversity of our communities, and to foster a sector that drives economic growth, creates good jobs, and bolsters conservation and sustainability. Drawing on engagement and capabilities from across the federal government, the strategy aims to support broad-based economic growth in travel and tourism across the United States, its territories, and the District of Columbia.

Key points of the 2022 National Travel and Tourism Strategy

The federal government will work to implement the strategy under the leadership of the TPC and in partnership with the private sector, aiming toward an ambitious five-year goal of increasing American jobs by attracting and welcoming 90 million international visitors, who we estimate will spend $279 billion, annually by 2027.

The new National Travel and Tourism Strategy supports growth and competitiveness for an industry that, prior to the COVID-19 pandemic, generated $1.9 trillion in economic output and supported 9.5 million American jobs. Also, in 2019, nearly 80 million international travelers visited the United States and contributed nearly $240 billion to the U.S. economy, making the United States the global leader in revenue from international travel and tourism. As the top services export for the United States that year, travel and tourism generated a $53.4 billion trade surplus and supported 1 million jobs in the United States.

The strategy follows a four-point approach:

Promoting the United States as a Travel Destination Goal : Leverage existing programs and assets to promote the United States to international visitors and broaden marketing efforts to encourage visitation to underserved communities.
Facilitating Travel to and Within the United States Goal : Reduce barriers to trade in travel services and make it safer and more efficient for visitors to enter and travel within the United States.
Ensuring Diverse, Inclusive, and Accessible Tourism Experiences Goal : Extend the benefits of travel and tourism by supporting the development of diverse tourism products, focusing on under-served communities and populations. Address the financial and workplace needs of travel and tourism businesses, supporting destination communities as they grow their tourism economies. Deliver world-class experiences and customer service at federal lands and waters that showcase the nation’s assets while protecting them for future generations.
Fostering Resilient and Sustainable Travel and Tourism Goal : Reduce travel and tourism’s contributions to climate change and build a travel and tourism sector that is resilient to natural disasters, public health threats, and the impacts of climate change. Build a sustainable sector that integrates protecting natural resources, supporting the tourism economy, and ensuring equitable development.

Travel and Tourism Fast Facts

The travel and tourism industry supported 9.5 million American jobs through $1.9 trillion of economic activity in 2019. In fact, 1 in every 20 jobs in the United States was either directly or indirectly supported by travel and tourism. These jobs can be found in industries like lodging, food services, arts, entertainment, recreation, transportation, and education.
Travel and tourism was the top services export for the United States in 2019, generating a $53.4 billion trade surplus.
The travel and tourism industry was one of the U.S. business sectors hardest hit by the COVID-19 pandemic and subsequent health and travel restrictions, with travel exports decreasing nearly 65% from 2019 to 2020.
The decline in travel and tourism contributed heavily to unemployment; leisure and hospitality lost 8.2 million jobs between February and April 2020 alone, accounting for 37% of the decline in overall nonfarm employment during that time.
By 2021, the rollout of vaccines and lifting of international and domestic restrictions allowed travel and tourism to begin its recovery. International arrivals to the United States grew to 22.1 million in 2021, up from 19.2 million in 2020. Spending by international visitors also grew, reaching $81.0 billion, or 34 percent of 2019’s total.

More about the Tourism Policy Council and the 2022 National Travel and Tourism Strategy

Created by Congress and chaired by Secretary Raimondo, the Tourism Policy Council (TPC) is the interagency council charged with coordinating national policies and programs relating to travel and tourism. At the direction of Secretary Raimondo, the TPC created a new five-year strategy to focus U.S. government efforts in support of the travel and tourism sector which has been deeply and disproportionately affected by the COVID-19 pandemic.

Read the full strategy here

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Fundamental Analysis
Sectors & Industries

Service Sector: Place in Economy, Definition and Examples

Gordon Scott has been an active investor and technical analyst or 20+ years. He is a Chartered Market Technician (CMT).

Investopedia / Jiaqi Zhou

What Is the Service Sector?

The service sector produces intangible goods, more precisely services instead of goods, and according to the U.S. Census Bureau , it comprises various service industries including warehousing and transportation services; information services; securities and other investment services; professional services; waste management; health care and social assistance; and arts, entertainment, and recreation. Countries with economies centered around the service sector are considered more advanced than industrial or agricultural economies.

Key Takeaways

The service sector is the third sector of the economy, after raw materials production and manufacturing.
The service sector includes a wide variety of tangible and intangible services from office cleaning to rock concerts to brain surgery.
The service sector is the largest sector of the global economy in terms of value-added and is especially important in more advanced economies.

Understanding Service Sector

The service sector, also known as the tertiary sector, is the third tier in the three-sector economy. Instead of product production, this sector produces services maintenance and repairs, training, or consulting. Examples of service sector jobs include housekeeping, tours, nursing, and teaching. By contrast, individuals employed in the industrial or manufacturing sectors produce tangible goods , such as cars, clothes, or equipment.

Among the countries that place heavy emphasis on the service sector, the United States, the United Kingdom, Australia, and China rank among the top. In the United States, the Institute for Supply Management (ISM) produces a monthly index that details the general state of business activity in the service sector. This index is regarded as a metric for the overall economic health of the country because approximately two-thirds of U.S. economic activity occurs in the service sector.

The Service Sector in the Three-Part Economy

The service or tertiary sector is the third piece of a three-part economy. The first economic sector, the primary sector, covers the farming, mining, and agricultural business activities in the economy. The secondary sector covers manufacturing and business activities that facilitate the production of tangible goods from the raw materials produced by the primary sector. The service sector, though classified as the third economic sector, is responsible for the largest portion of the global economy’s business activity.

Technology in the Service Industry

Technology, specifically information technology systems, is shaping the way businesses in the service sector operate. Businesses in this sector are rapidly placing more focus on what is becoming known as the knowledge economy , or the ability to surpass competitors by understanding what target customers want and need, and operate in a way that meets those wants and needs quickly with minimal cost. In nearly all industries within the sector, businesses adopt new technology to bolster production, increase speed and efficiency, and cut down on the number of employees required for operation. This cuts down on costs and improves incoming revenue streams.

U.S. Census Bureau. " Snapshot of Service Industries: 2020 ," Page 2.

Organisation for Economic Co-operation and Development. " Services Trade in the Global Economy ."

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Travel Tips

What Are The 7 Sectors Of Tourism

Published: December 12, 2023

Modified: December 28, 2023

by Mable Roldan

Travel Guide

Introduction

Welcome to the exciting world of tourism! As travel enthusiasts, we often embark on journeys to discover new destinations, experience different cultures, and create unforgettable memories. But have you ever wondered about the various sectors that make up the tourism industry? Understanding these sectors can help us gain insight into the complex web of services and experiences that come together to create the perfect travel experience.

The tourism industry encompasses a wide range of activities and services, all aimed at providing travelers with comfortable and enjoyable experiences. These sectors work harmoniously to ensure that every aspect of a trip, from accommodation to transportation and beyond, is well taken care of. In this article, we will explore the seven key sectors of tourism, each playing a vital role in the overall travel experience.

From finding the perfect place to stay, to indulging in delectable local cuisine, to getting around efficiently, each sector offers unique services and experiences that contribute to the overall success of a trip. So, let’s dive into the world of tourism sectors and discover how they come together to create unforgettable journeys!

Accommodation Sector

The accommodation sector is a fundamental pillar of the tourism industry, providing travelers with a home away from home during their travels. This sector comprises a diverse range of options, ranging from luxurious hotels and resorts to budget-friendly hostels and vacation rentals.

Accommodation providers strive to ensure that guests have a comfortable and pleasant stay by offering a variety of amenities and services. From well-appointed rooms and spacious suites to 24/7 reception and room service, the accommodation sector aims to meet the needs and preferences of all types of travelers.

In recent years, there has been a remarkable surge in alternative accommodation options such as home-sharing platforms like Airbnb, allowing travelers to rent unique properties directly from homeowners. This trend has provided travelers with a wider range of choices and the opportunity to experience local neighborhoods and cultures more authentically.

Additionally, sustainability and eco-consciousness have become important factors in the accommodation sector. Many establishments are implementing eco-friendly practices, such as energy-efficient lighting and recycling programs, to reduce their environmental impact and attract guests who prioritize sustainable tourism.

Furthermore, technology has played a significant role in enhancing the accommodation sector. Online booking platforms and mobile apps have made it easier than ever for travelers to research, compare, and book accommodations, providing a seamless experience. The use of keyless entry systems and personalized mobile concierge services have also become popular, allowing guests to have a hassle-free and customized stay.

Whether it’s a cozy bed and breakfast nestled in a charming countryside or a luxurious beachfront resort with stunning ocean views, the accommodation sector offers a wide range of options to suit every budget, preference, and travel style.

Food and Beverage Sector

The food and beverage sector is a vital component of the tourism industry, as it provides travelers with culinary experiences that reflect the local culture and traditions of a destination. This sector encompasses a wide range of establishments, including restaurants, cafes, bars, food trucks, and street food vendors.

One of the highlights of travel is indulging in diverse cuisines and trying new flavors. The food and beverage sector caters to these cravings by offering a plethora of dining options, from upscale fine dining restaurants to casual eateries serving traditional local dishes. Travelers can savor authentic flavors, culinary masterpieces, and innovative fusions that highlight the region’s unique gastronomy.

Many destinations are known for their vibrant food scenes, with local markets and street food stalls offering a rich tapestry of flavors and aromas. Exploring local markets and trying street food can be a memorable and immersive experience, allowing travelers to get a taste of the authentic culinary culture of a place.

The food and beverage sector also caters to specific dietary needs and preferences. With an increasing number of people following vegetarian, vegan, or gluten-free diets, many establishments now offer diverse menu options to accommodate various dietary requirements. This inclusivity ensures that travelers with dietary restrictions can still enjoy delicious meals and be part of the culinary exploration.

Moreover, the sector has witnessed a rising trend of farm-to-table dining and emphasis on local, sustainable ingredients. Restaurants and cafes are partnering with local farmers, growers, and producers to source fresh, seasonal ingredients, supporting the local economy and reducing the carbon footprint associated with long-distance food transportation.

Technology has also made its mark on the food and beverage sector, with online restaurant reviews, recommendations, and food delivery apps allowing travelers to discover and enjoy the best dining experiences effortlessly. Additionally, some establishments employ innovative concepts like interactive dining experiences, fusion cuisines, and molecular gastronomy, aiming to provide unique and memorable meals that go beyond traditional dining.

From savoring Michelin-starred delicacies to sampling street food treasures, the food and beverage sector offers a diverse and enticing array of culinary experiences for travelers to delight their taste buds and create lasting memories.

Transportation Sector

The transportation sector is an essential component of the tourism industry, connecting travelers to their desired destinations. It encompasses various modes of transportation, including air travel, train and rail services, bus and coach services, cruises, and car rentals.

Air travel is a major player in the transportation sector, providing international and domestic flights that enable travelers to reach their destinations quickly and efficiently. Airlines strive to offer comfortable seating, in-flight entertainment, and quality service to enhance the overall travel experience. With the expansion of low-cost carriers, air travel has become more accessible and affordable, driving tourism growth around the world.

Train and rail services are another popular mode of transportation, especially for intercity travel and scenic journeys. Traveling by train allows passengers to enjoy stunning landscapes, experience local culture, and connect with different regions or countries in a convenient and sustainable way.

Bus and coach services provide economical transportation options for both urban and rural areas. They are often preferred by budget-conscious travelers or those seeking a more immersive experience, as they allow passengers to interact with locals and witness the changing landscapes along the journey.

Cruise tourism has also gained popularity, offering unique travel experiences on sea voyages. Cruise ships provide a floating resort-like experience, with amenities such as restaurants, entertainment venues, and recreational activities, while allowing travelers to explore different destinations without the need for constant packing and unpacking.

Car rentals give travelers the freedom to explore at their own pace, particularly in destinations with extensive road networks and scenic drives. Renting a car allows for flexibility and the opportunity to venture off the beaten path, discovering hidden gems and experiencing a more personalized travel itinerary.

Advancements in technology have revolutionized the transportation sector, making it more convenient and accessible for travelers. Online platforms and mobile apps allow for seamless booking and ticketing, real-time travel updates, and navigation assistance. Ride-hailing services have also gained popularity, providing an alternative mode of transportation in urban areas.

Transportation plays a crucial role in shaping a traveler’s overall experience, as it sets the tone for their journey and connects them to the various attractions and activities of a destination. Efficient and well-connected transportation networks contribute to the accessibility and attractiveness of a place, making it easier and more enjoyable for travelers to explore and immerse themselves in new cultures and experiences.

Travel Agency Sector

The travel agency sector plays a pivotal role in the tourism industry, acting as a bridge between travelers and their dream destinations. Travel agencies provide valuable services and expertise to help travelers plan and organize their trips, ensuring a smooth and hassle-free experience.

Travel agencies serve as a one-stop-shop for all travel-related needs. They assist travelers in selecting destinations, finding the best deals on accommodations, arranging transportation, and curating itineraries based on individual preferences and budgets. Whether it’s a solo adventure, a family vacation, a romantic getaway, or a group tour, travel agencies cater to a wide range of travel styles and requirements.

These agencies maintain relationships with airlines, hotels, tour operators, and other service providers, enabling them to secure discounted rates and exclusive packages for their clients. They have firsthand knowledge of destinations, attractions, and local customs, allowing them to offer valuable advice and recommendations to travelers.

In addition to organizing the logistics of a trip, travel agencies often specialize in specific types of travel experiences. They may focus on adventure travel, luxury vacations, cultural immersion, or niche markets like eco-tourism or culinary tours. This specialization allows them to provide expert guidance tailored to the specific interests of their clients.

With the rise of online travel booking platforms, some may question the relevance of travel agencies. However, travel agencies still hold a significant advantage with their personalized service and expertise. They can offer valuable insights and recommendations, handle complex itineraries, and provide support in the event of any unexpected issues during the trip.

Furthermore, travel agencies often offer additional services such as travel insurance, visa assistance, and 24/7 customer support. These added benefits alleviate the stress and uncertainties that can arise when planning and embarking on a journey, giving travelers peace of mind.

In recent years, travel agencies have also embraced technology to enhance their services. Many agencies have online platforms where travelers can research, compare, and book travel services. They utilize social media and content marketing strategies to inspire and engage potential clients, sharing travel tips, destination highlights, and special offers.

Overall, the travel agency sector plays a vital role in facilitating seamless and enjoyable travel experiences. Their expertise, personalized service, and access to exclusive deals make them valuable partners for travelers seeking professional assistance and guidance in planning their adventures.

Adventure and Recreation Sector

The adventure and recreation sector of the tourism industry caters to thrill-seekers and outdoor enthusiasts, offering a wide range of exciting activities and experiences. This sector is perfect for those looking to step out of their comfort zone, immerse themselves in nature, and create unforgettable memories.

Adventure tourism encompasses activities such as hiking, mountaineering, rock climbing, zip-lining, white-water rafting, and paragliding, among others. These activities provide a unique opportunity to explore natural landscapes, challenge oneself physically and mentally, and appreciate the beauty and wonders of the great outdoors.

Recreation tourism, on the other hand, focuses on leisure and relaxation. This sector includes activities such as beach vacations, golfing, spa retreats, wellness retreats, and wildlife safaris. Recreation tourism offers a chance to unwind, rejuvenate, and engage in activities that promote overall well-being and tranquility.

While adventure and recreation activities differ in their nature, both sectors contribute to sustainable tourism by raising awareness about environmental conservation and supporting local communities. Many adventure tourism operators and recreational facilities follow sustainable practices, ensuring the preservation of natural resources and the protection of delicate ecosystems.

Adventure and recreation tourism also provide economic opportunities for local communities. These activities often require specialized guides, equipment rental services, and accommodation facilities, creating employment and generating income for the host destinations.

Technology has played a significant role in the growth of the adventure and recreation sector. Online platforms and mobile applications make it easier for travelers to research and book activities, access trail maps, and connect with local guides. Adventure and recreation companies often leverage social media platforms to showcase their offerings and inspire potential travelers.

The adventure and recreation sector offers a diverse range of experiences, catering to a variety of interests and skill levels. Whether it’s summiting a mountain peak, scuba diving in a vibrant coral reef, or simply enjoying a peaceful yoga retreat, this sector ensures that travelers can find activities that align with their preferences and desired level of excitement.

It’s important to note that safety and responsible tourism practices are essential in the adventure and recreation sector. Travelers should choose licensed operators, follow guidelines provided by professionals, respect the environment, and prioritize their own safety and well-being while engaging in adventurous activities. This ensures a positive and sustainable experience for both travelers and the destinations they visit.

Events and Conferences Sector

The events and conferences sector of the tourism industry plays a pivotal role in bringing together professionals, enthusiasts, and like-minded individuals from various fields. This sector is responsible for organizing and hosting a wide range of events, conferences, trade shows, and exhibitions that contribute to knowledge-sharing, networking, and business growth.

Events and conferences serve as platforms for professionals to exchange ideas, showcase innovations, and discuss current trends in their respective industries. They provide opportunities for networking, collaboration, and learning, fostering professional development and driving innovation.

The sector encompasses a diverse range of events, including academic conferences, industry exhibitions, music festivals, sports competitions, cultural festivals, and trade shows, among many others. These events attract participants from different parts of the world, contributing to the economic growth of the host destination.

Events and conferences often require specialized infrastructure and facilities, such as convention centers, exhibition halls, and hotels with conference facilities. These venues provide the necessary space, technology, and amenities to accommodate large gatherings and ensure the smooth execution of events.

The events and conferences sector contributes to the tourism industry by boosting visitor numbers, filling hotel rooms, and driving revenue for local businesses such as restaurants, transportation services, and event vendors. Host destinations often see a surge in tourism during major events, as attendees explore the local attractions and contribute to the local economy.

Technology has played a significant role in enhancing the events and conferences sector. Virtual conferences and hybrid event formats have gained popularity, allowing participants to attend events remotely, reducing travel expenses and environmental impact. Event management software, mobile apps, and online registration systems have streamlined event organization, making it easier for attendees to access event information, sign up for sessions, and engage with other participants.

It’s important to note that the events and conferences sector is not limited to business-related gatherings. Cultural festivals, music concerts, and sporting events also fall under this sector, offering unique experiences that celebrate art, music, sports, and local traditions.

A well-executed event or conference can leave a lasting impact on participants, fostering professional connections, knowledge exchange, and inspiration. By bringing people together, this sector contributes to the growth and development of various industries and promotes cultural exchange and mutual understanding.

Tourism Services Sector

The tourism services sector is a vital component of the overall tourism industry, providing a wide range of support services to both travelers and businesses operating within the tourism sector. This sector encompasses various services that enhance the travel experience and contribute to the seamless operation of the industry.

One of the key services in this sector is tourism information and assistance. Tourism information centers, both physical and virtual, provide valuable resources and guidance to travelers, offering information about destinations, attractions, accommodation options, transportation, and activities. These centers play a crucial role in helping travelers plan their itineraries and make informed decisions.

Another important aspect of the tourism services sector is travel insurance. Travel insurance provides coverage for unexpected events such as trip cancellations, medical emergencies, lost baggage, and travel interruptions. It offers peace of mind to travelers, ensuring that they are protected from unforeseen circumstances that may disrupt their travel plans.

Visa assistance is another significant service within this sector. Many destinations require travelers to obtain visas before entry, and navigating the visa application process can be complex and time-consuming. Visa assistance services, whether provided by travel agencies or specialized companies, help travelers understand the requirements, gather the necessary documentation, and facilitate the visa application process.

Translation and interpretation services are also essential in the tourism services sector, particularly in destinations where the local language may be a barrier for some travelers. These services ensure effective communication between travelers and local residents, allowing for a smoother and more immersive experience.

Additionally, currency exchange services play a vital role in facilitating financial transactions for travelers. The ability to exchange currencies conveniently and at fair rates ensures that travelers have access to the local currency for their expenses during their trip.

Technology has transformed the tourism services sector, making these services more accessible and convenient. Mobile applications, online platforms, and virtual assistants provide travelers with instant access to information, assistance, and services. Many travel service providers offer online booking options and 24/7 customer support, allowing travelers to make reservations and address any queries or concerns at their convenience.

The tourism services sector acts as a backbone for the overall tourism industry, ensuring that travelers have access to the necessary support, information, and services they need throughout their journey. By providing valuable assistance and enhancing the travel experience, this sector plays a vital role in fostering customer satisfaction and driving the growth of the tourism industry as a whole.

The tourism industry is a complex and multifaceted sector, composed of various interconnected sectors that work together to provide unforgettable travel experiences. From accommodations and food to transportation and events, each sector plays a crucial role in shaping the overall travel experience and contributing to the success of the tourism industry.

The accommodation sector ensures that travelers have a comfortable and enjoyable place to stay, offering a wide range of options to suit every preference and budget. The food and beverage sector tantalizes taste buds with diverse cuisines and culinary experiences, reflecting the local culture and traditions of a destination.

The transportation sector connects travelers to their desired destinations, providing convenient and efficient modes of travel. Travel agencies serve as invaluable resources, offering expertise and assistance in planning and organizing trips, while the adventure and recreation sector caters to thrill-seekers and outdoor enthusiasts craving adrenaline-pumping experiences.

Events and conferences bring professionals together, fostering knowledge sharing, networking, and innovation. Finally, the tourism services sector provides essential support services such as information and assistance, travel insurance, visa facilitation, translation and interpretation, and currency exchange.

Technology has revolutionized the tourism industry, making information and services more accessible, convenient, and personalized. Online booking platforms, mobile apps, and virtual assistance have transformed the way travelers research, plan, and book their trips.

In conclusion, understanding the various sectors of the tourism industry allows us to appreciate the intricate web of services that work harmoniously to create remarkable travel experiences. Whether it’s relaxing in a luxurious hotel, savoring local delicacies, exploring beautiful landscapes, attending a conference, or receiving helpful assistance, each sector contributes to the success and enjoyment of a trip. By recognizing the importance of these sectors and embracing technology’s advancements, we can continue to enhance and evolve the tourism industry and provide unforgettable experiences for travelers around the world.

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Complete Overview of the 5 Sectors in the Tourism Industry

Overview of the sectors in tourism

The interplay of sectors in tourism, impact of each sector on the tourism industry, challenges and opportunities in each sector.

The tourism industry is one of the most dynamic landscapes . That’s primarily because it consists of several unique sectors. Each one of these sectors goes through comprehensive changes and is subject to many factors.

Nevertheless, understanding these sectors is quite essential! Why? Because it can help you make informed business decisions, identify valuable growth opportunities, future-proof your travel brand, and, ultimately, set it up for success.

Below you can find an in-depth analysis of the different sectors in tourism, how they affect each other, and the industry as a whole. Finally, you will discover unique challenges and opportunities for each sector.

The tourism vertical is quite extensive. It consists of six sectors, making it one of the most diverse industries. These sectors are transportation, accommodation, food and beverage, travel agencies, and attractions. Let’s take a closer look at the sectors, their sizes, and their economic impact.

Transportation in Tourism

Transportation in tourism is a big sector. It encompasses a wide range of forms of travel and enables tourists to reach their destinations safely and efficiently. The sub-sectors include air travel, land transportation, and maritime travel.

When it comes to inbound tourism, air travel comprises the largest share, 57% . Travelers trying to reach faraway destinations often choose from various travel options. One can actually gauge the momentum of the tourism sector recuperation after the COVID-19 pandemic by looking at air transportation trends. The latest report states that total air traffic is up by 52% compared to 2022 .

Land transportation for tourists has been increasing in recent years. A recent study reveals that car transportation makes up 77% of all journeys . The reasons that explain this trend are flexibility, price, and independence.

Maritime travel or cruise tourism is also experiencing steady growth. This subsector is estimated to continue to grow at a CAGR of 10.4% from 2022 to 2031 .

Transportation is one of the pillars of the tourism industry, and as such, it has a tremendous economic impact on the vertical – its efficient functioning is critical for not only attracting tourists to destinations but also enabling them to reach their desired locations . It allows companies to generate revenue through ticket sales. However, by enabling tourists to reach their destinations, it also drives economic activity in hospitality.

Accommodation in Tourism

All the lodging options tourists can choose from comprise the accommodation subsector of the tourism industry. It includes hotels, resorts, hostels, vacation rentals, Airbnb, and more.

The hotel occupancy rates metric is the best one to keep track of the developments in this subsector simply because there are almost 750,000 hotels and resorts worldwide . In April 2022, hotel occupancy rates were highest in the Americas, reaching 64% . Europe was in second place with the hotel occupancy rates at 63%, followed by the Middle East and Africa at 49% and the Asia Pacific at 48%.

When it comes to the economic impact, the best metric to track is revenue per available room or RevPAR. The RevPar reached $93.27 in 2022, an 8.1% increase compared to 2019 . The average daily rate is up by 13.6%, which makes $148.83 for the same period. Occupancy rates are still not at the pre-pandemic level, but with only a 4.9% difference, they are getting there.

The revenue this sector generates has a tremendous impact. The money is used toward creating new jobs, developing infrastructure, and boosting local economies. Local communities and governments also benefit from the taxes and fees collected from accommodation providers.

Food and Beverage in Tourism

The food and beverage tourism sector is quite diverse and doesn’t just include restaurants and cafes. It also encompasses various dining establishments where tourists can experience local culinary traditions and cuisine.

According to the National Restaurant Association research, the sales in the fine dining segment to travelers and visitors went down by 41% . However, total restaurant industry sales are projected to reach $.1.2 trillion by 2030 , and traveler purchases will significantly contribute to this positive development. The food tourism market is projected to reach $1,796.5 billion by 2027 in size, which is a 16.8% growth given that its size in 2022 is $1,116.7 billion.

One of the most extensive studies done recently encompassed the data from over 50,000 travelers to conclude that 64% of travelers base their traveling decisions on the food and drink options available at their destination.

There are two sides to the economic impact of food and beverage in tourism. First, it helps generate more direct revenue, and second, it fosters culinary entrepreneurship and can significantly boost agricultural and food production sectors. It can also help create more job opportunities.

Travel Agencies and Tour Operators

Travel agencies are travel brands that specialize as intermediaries. They provide tourists with access to accommodation and other tourism options. Travel agencies can also offer various services, such as tour packages, accommodation reservations, and transportation booking .

Online travel agencies or OTAs are currently dominating this space. In 2022, the online global travel market size reached $475 billion and is projected to reach over one trillion US dollars by 2030. OTAs, including the most significant players such as Booking.com, Trip.com, and Expedia, captured over 40% of the total market .

While travel agencies continue to generate revenue, it’s important to note that global travel agency revenue is growing at a CAGR of 2.5% .

Travel agencies, both offline and online, are vital parts of the entire travel ecosystem. They both contribute to the whole sector and facilitate tourism overall. Travel agencies stimulate economic activity through other sectors as they are responsible for actually funneling tourists to destinations. They also help create new jobs, improve travel satisfaction, and ensure repeat business.

Tour operators, the companies that create packages for travel agencies to sell, also make up a sizable sub-sector. The market size of the tour operators industry in the US in 2022 was $8.6 billion . The US market will continue to grow at a CAGR of 17% to reach $30 billion in size by 2023 . Across the ocean, we have Europe, with its tour operator market size projected to reach $74 billion by 2026 , with Germany as the leader in the field with a market size of $24 billion.

Tourism Attractions

Tourism attraction is a place of interest. Generally speaking, tourism attractions’ primary role is to attract tourists to a particular destination. It can be anything from natural wonders and historical sites to museums and cultural landmarks.

According to the latest data , the most visited attractions are spread across the globe. These include Nagashima Spa Land, Japan; Universal Studio, USA; Palace of Versailles, France; and Bourbon Street, USA.

Theme parks are also among the most popular tourist attractions. In 2022, these parks attracted almost 200 million visitors . The museums are right behind theme parks, with an attendance of 57 million.

Tourism attractions also have a significant economic impact. They support jobs in the vicinity, boost local economies, and positively impact the overall tourist experience. They are also the number one factor that often drives visitation.

The most important thing to understand about sectors in the tourism industry is that they are not separated from one another. In fact, the interplay of sectors in tourism is quite elaborate and happens on so many different levels.

Let’s start with transportation. The affordable, dependable, and reliable means of transportation can facilitate visitation. Transportation is also responsible for the tourist experience. It can improve access to tourism attractions, make tourism agencies more attractive, and drive sales in the accommodation and food and beverage sectors.

Accommodation in tourism often interplays with travel agencies. It can help improve the brand image of a travel agency by enhancing the stay experience. It can also lead to increased food and beverage sales if the hotel or a resort has its own facilities, such as a restaurant or bar. In return, the food and beverage sector can improve the standing of accommodations and destinations in the eyes of travelers.

Travel agencies interplay with all of the sectors. The services they offer have to live up to the descriptions found on the websites. They can help boost the average daily rates for accommodation providers, increase booking rates at transportation companies, and bring more people to attractions.

The best way to look for the interplay of sectors in tourism is to closely examine partnerships. The transportation, accommodation, and other various travel brands have recognized the value of the interplay and decided to partner up to reap even more benefits.

The most common are partnerships between airlines, hotels, and travel agencies. It enables airlines to remain competitive while helping hotels and travel agencies maintain high customer satisfaction and enhanced travel experience.

The real-world example that comes to mind is Wilderness Safaris’ partnership with Qatar Airways . The big hospitality brand wanted its guests to arrive well-fed & rested, ready to engage in adventures in the great outdoors. Given that Qatar Airways received high marks in the catering and business class areas, it was the perfect pick for Wilderness Safaris.

Another real-world example is AEGAN’s partnership with Booking.com. Here, we have a transportation company and OTA joining forces together to reap unique benefits. AEGAN, an airline brand, wanted its customers to be able to conveniently check hotel availability in real-time, book accommodation at competitive prices, and benefit from friendly cancellation policies.

To encourage travelers to choose AEGAN services through Booking.com, the company also launched the Frequent Flyer Program and awarded consumers extra miles with every hotel booking using AEGAN transportation services.

As one of the largest industries, the tourism vertical contributes 10% of all jobs or 333 million . All sectors contribute to job creation and the global tourism market size of $2.4 trillion .

Accommodation and food and beverage sectors have a significant impact on the tourism industry as well. In terms of GDP, these sectors contributed 3.3% , a significant growth, given that the US average is 2.87% .

In raw numbers, it looks like the following. Global accommodation in tourism generates $903 billion . Almost half of it, 49%, comes from the USA sector. Europe, APAC, Middle East, and Africa contribute with their shares of 25%, 22%, 3%, and 2%, respectively. The global hotel and resort industry currently employs approximately 10.5 million people .

The global travel agency services industry’s revenue has reached $475 in 2023 . Travel agencies in the US employ 402,835 people. Over the last 5 years, the number of people working in the travel agency sector went up by 12%. On a global scale, travel agencies employ approximately 2 million people .

While every industry and sub-sector is unique, they all share a few things in common. In each one of them, you can find a couple of opportunities and encounter a few challenges. Let’s see what challenges and opportunities there are in each sector.

Transportation in tourism

Challenges:

Ever-increasing prices of fuel – to remain profitable, airlines need to manage operational costs, and one of the enormous costs is fuel;
Becoming green – transportation companies need to reduce carbon emissions and adopt sustainable travel practices, which can be challenging and costly;
Infrastructure in remote destinations – building roads and developing infrastructure can be pretty challenging in remote destinations with tremendous tourism potential.

Opportunities:

Using technological advancements – transportation technologies can help improve customer experience and improve operational efficiencies;
Implementing sustainable practices – becoming eco-friendly can help brands attract environmentally conscious travelers;
Improving connectivity – with connectivity expansion, transportation brands can help local economies and create new tourism opportunities.

Accommodation in tourism

Online offer – as more and more competitors join online marketplaces, accommodation providers need to embrace a new paradigm;
Overtourism – limited accommodation capacity is a massive problem in destinations where over-tourism is a norm;
Guest safety and security – in some situations and locations, accommodation providers can struggle with ensuring guest safety and security.
Going digital – embracing cutting-edge technologies can help enhance guest experience and ensure longer and repeat stays;
Personalized accommodation – offering boutique and experiential lodging can help accommodation providers cater to modern travelers;
Partnerships – aligning with relevant companies and local brands can help providers attract more travelers.

Food and beverage in tourism

Quality and safety of food – upholding the highest food quality and safety standards can be challenging;
Fluctuating demand – seasonal destinations can struggle with handling fluctuating food and beverage demand;
Shifting dietary preferences – guests may have diverse dietary preferences, which require planning and management.
Innovation – innovative dishes and fusion cuisines can attract guests who feel more adventurous;
Farm-to-table – cooperating with local farmers can help bring fresh ingredients to restaurants;
Focus on local cuisine – bringing local dishes into the spotlight can help attract people interested in authentic cuisine.

Travel agencies

Harsh competition – travel agencies have to compete against hundreds of online travel booking platforms;
Tailored services – many travelers look for personalized experiences, which can prove hard to provide if you are a small agency;
Agility is required – getting ready for a wide range of disruptions is costly and hard to sustain at scale.
Customization – offering unique packages can help generate more bookings;
Multi-channel presence – being present across online and offline channels is paramount;
Focus on a niche market – staying focused on a specific travel niche can help you truly cater to the needs of your target customers.

Tourism attractions

Preservation – sustainable management of tourism attractions can be challenging;
Seasonality – if traction generates the majority of the revenue through seasonal visitors, it can be a problem;
Infrastructure demand – a growing number of visitors can cause infrastructure strain.
Collaboration – partnerships can help create a better ecosystem;
Interpretive guides and interactive displays – interpretive experiences can delight a wide range of visitors;
Expanding offer – You can offer new activities to make the offer more attractive.

As you can see, the tourism industry landscape is quite comprehensive, with a lot of moving pieces on the board, and the best way to understand the vertical is to take a look at its subsectors.

Hopefully, now you understand transportation, accommodation, food and beverage, travel agencies, and tourism attraction sectors better. They are all intertwined, with many interplay activities. While the tourism sector comes with its fair share of challenges, there are also many opportunities. The current stats and projections tell us that all subsectors are prosperous and expected to grow in the foreseeable future.

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Marc Truyols has a degree in Tourism from the University of the Balearic Islands. Marc has extensive experience in the leisure, travel and tourism industry. His skills in negotiation, hotel management, customer service, sales and hotel management make him a strong business development professional in the travel industry.

Mize is the leading hotel booking optimization solution in the world. With over 170 partners using our fintech products, Mize creates new extra profit for the hotel booking industry using its fully automated proprietary technology and has generated hundreds of millions of dollars in revenue across its suite of products for its partners. Mize was founded in 2016 with its headquarters in Tel Aviv and offices worldwide.

Empowering Equality: Mize Leads the Way in Travel Technology

7 min. Are we all equal? Are we all equally represented in the business world? In some professional sectors, there might still be some under-representation of women, minorities, and the LGBTQIA+ community. The tech sphere is no different, but is the travel tech sector a spark of hope? As the business world becomes more diverse, […]

Slow Tourism Case Studies: Examples to Truly Understand Slow Tourism

14 min. The tourism industry is moving at an ever-accelerating pace. That’s because the tourism industry is perhaps one of the verticals that depend on the most factors. One of the main factors that affect it is social movements, given that tourism brands of all sizes always cater to the needs of consumers. One of […]

All About the 5 Top Travel Agencies in China

20 min. One of today’s largest travel markets was practically nonexistent between 1949 and the 1970s. Yes, the Chinese travel market didn’t exist because the People’s Republic was entirely closed to travelers until the late 1970s. However, it’s not the only thing that makes this market exciting and inviting for a closer look. In 2012, […]

ORIGINAL RESEARCH article

Perceived service quality and visitors' sustainable visit intentions in theme parks: empirical analysis on the themequal scale provisionally accepted.

1 Guangdong Peizheng College, China

The final, formatted version of the article will be published soon.

Theme parks, as indispensable commodities within the tourism industry, wield significant influence in fostering local and national economic development. However, despite their crucial role, there remains a dearth of comprehensive research concerning the determinants of theme park visits. Employing the THEMEQUAL scale, this study uses an ordered logit model and in-depth interview method to investigate the effects of service quality on visitors' sustainable visit intentions (SVIs). Results show service quality is the most pivotal determinant shaping SVIs, and effects are moderated by COVID19, i.e., a reduced emphasis on service quality in bolstering visitors' sustainable visit inclinations during this pandemic. Specially, assurance and courtesy of staff delivering their confidence markedly influence visitors' perceptions. This research contributes to a comprehensive interplay between service quality, COVID19 and visitors' SVIs, providing reference for policy makers and managers to develop theme park recovery policies in the post pandemic era.

Keywords: Theme Park Service Quality, logit model, SVIS, THEMEQUAL scale, Post-pandemic

Received: 16 Feb 2024; Accepted: 08 Apr 2024.

Copyright: © 2024 LUO and Li. This is an open-access article distributed under the terms of the Creative Commons Attribution License (CC BY) . The use, distribution or reproduction in other forums is permitted, provided the original author(s) or licensor are credited and that the original publication in this journal is cited, in accordance with accepted academic practice. No use, distribution or reproduction is permitted which does not comply with these terms.

* Correspondence: Dr. JINGJING LUO, Guangdong Peizheng College, Guangzhou, China

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Tourism Services Meaning, Nature and Marketing Strategies

Table of content:-, tourism services meaning, nature of tourism services, tourism service marketing strategies.

Tourism services play an important role in the global travel industry. It caters to the various needs and wants of travellers worldwide.

Tourism is currently one of the fastest-growing industries worldwide. It is primarily a service Industry as it does not produce goods but it focuses on providing services to a wide range of individuals across different social classes. Tourism encompasses a blend of interconnected industries and trades, including the hotel and transport sectors.

It is a complicated business as it involves multiple socio-economic activities like attracting people to a destination, transporting them, housing, feeding and entertaining them, etc. In the process, it brings about tremendous infrastructural improvements and contributes to the overall development of the region. Tourism is one of the few industries that generate foreign exchange without exporting national wealth.

Tourism encompasses the activity of travelling between places for leisure, business, or other purposes. From one country to another for performing a specific task or it is a visit to a place or several places for entertainment which leads to an awareness of other civilisations and cultures, also increasing the knowledge of cultures, countries, cultures and history.

The tourism industry comprises the activities of individuals who travel to and reside in locations different from their regular surroundings, typically for a duration of up to six consecutive months but not less than 24 hours. This travel can be undertaken for leisure, business, or various other reasons unrelated to performing a paid activity within the destination. In simple terms, tourism is the act of travel for pleasure, leisure, or business and the provision of services for this act.

nature of business meaning
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The nature of tourism services is as follows:

1) Heterogeneous

The tourism product is not homogeneous. We cannot standardise a service. Hotels attempt to standardise their room and service delivery as efficiently as possible through staff training and quality control procedures, but the human ingredient complicates the equation. Due to the nature of services that involve interactions between producers and consumers, each with their unique expectations, the perception of any product by all customers remains unlikely. External factors can also affect the overall tourist experience. A bumpy flight can spoil a delightful overseas journey.

2) Intangible

Tourism products, like all services, are intangible. They cannot be seen, felt, touched, or sampled before purchase.

3) Private-Sector Driven

Governments provide relatively little assistance to the tourism industry. The hotel industry has staged a long, hard battle to gain recognition as a service exporter such that it can be deserving of export grants. In most instances, the entrepreneur is responsible for their survival. Having said that, it is governments that shape the environment in which the industry operates. They provide much of the infrastructure and services used by tourists and the industry generally includes promotion and information technology services , the provision of roads, airports, railways and harbours, the management of national parks, visas and customs services, research and statistical data, education and training programmes and various public amenities.

4) Perishable

Tourism products are perishable. They cannot be stored for later use, unlike intangible products. Hence the prevalence of discounting in services. This leads to the major problem confronting the tourism operator-namely, demand fluctuation.

5) Vulnerable

Tourism is more vulnerable than any other industry to seasonal changes in demand. Demand fluctuation can be unseen, sometimes due to natural causes, others artificial. Acts of God include natural disasters and climate. Acts of Man include strikes (domestic pilots’ strike) international events (Gulf War) and murders (tourist murders in Florida).

6) Seasonality and Demand Fluctuations

In the realm of leisure tourism, it is a common trait for demand to experience significant fluctuations throughout the different seasons of the year. As a result, the occupancy rates of many tourism businesses increase to 90 to 100 per cent during the peak season but drop to 30 per cent or less during the off-peak season. In addition, it is quite common for many leisure tourism businesses to undergo seasonal closures. These demand variations in tourism are more important because of perishability. That is why, generating demand when there is less demand, is a primary concern for marketing managers.

7) High Interdependency among Sectors

A feature of tourism is its high degree of interrelatedness. For example, resort or hotel development cannot begin without adequate airports and roads to bring tourists to those properties.

8) High Fixed Costs of Service Operations

In the travel and tourism industry, it is generally the case that the operations have high fixed costs and comparatively lower variable costs. This fact focuses all service operators’ on the imperative of generating additional demand. Most large-scale businesses are obliged to function within a very narrow margin between total cost and total revenue. Therefore, even a slight variation of one percentage point in average load factors can determine whether a company may achieve profit or loss.

9) Interdependence of Tourism Products

To ensure a seamless vacation experience for a vacationer, all organizations involved in the tourism industry need to operate in perfect coordination. All organisations should function in coordination. The fortunes of tourist attractions in a destination are linked. Since a vacationer chooses attractions at a destination together with the products of transport, accommodation, catering, etc.,

Travel and tourism have become a global industry and are widely considered one of the fastest-growing, if not the fastest-growing, sectors globally. It ranks as the largest industry in the world in terms of employment (one out of every 16 employees worldwide) and ranks in the top two or three drives in almost every nation on nearly every measure.

Thus the travel and tourism industry has become a major contributor to the gross national product of many nations, with marketing tourist destinations and their products becoming a widely recognised practice for both private and public sector organisations. The marketing concept is based on a “long-term commitment” to the satisfaction of travellers’ needs and motives and for a more strategic marketing approach instead of relying on operational measures such as marketing communication .

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With more businesses striving for sustainability in line with the United Nations' Sustainable Development Goals (SDGs), businesses need to evolve beyond profit. But there must be a perspective on developing the organization in all 3 dimensions, whether it's the environment. (Environment), Society (Social) and Economy (Economic) To meet the expectations of customers who respect sustainable practices. The tourism industry must also provide opportunities for organizational growth. International standards are adopted and certified. It will help answer the problem of creating a good image for the company. Create a core driver of the community economy It may also contribute to making our world better.

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Information Services Industry in Tourism

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First Online: 29 July 2018
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Tagir Saifullin 2 &
Maria Lomovtseva 2

Part of the book series: Springer Proceedings in Business and Economics ((SPBE))

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Information appears as a commodity in modern society and the sphere of tourism is defined as an information-rich service that speaks of a direct information connection from tourist activity. Tourism in the modern interpretation cannot exist without the transfer of information. It acts as an information-rich service that shows once again the important role of information in the field of tourism. In this context, there is the phenomenon of tourism as an industry of information service. The paper deals with the information services industry and information technologies and focuses on its implementation in tourism industry. The researchers try to find a solution on how information technologies could increase the effectiveness of tourism business, so they introduce a model that consists of eight components (information, users, information resources, suppliers, information system, information processes, etc.). Then, the model is tested in hospitality and tourism industry companies. As a result of the test, the authors highlight some points to be improved in the model. To sum up, the model in its final version can assist and allow increasing the competitiveness of the tourism business. The authors conclude that the performance of the company also can be improved through computerization and informatization processes, especially in such an information-rich industry as tourism.

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Absalyamov, T., Absalyamova, S., & Absalyamova, A. (2014 May 14) Private museums as a form of preservation of cultural heritage. Procedia—Social and Behavioral Sciences, 188 , 218–221.

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Acknowledgements

This research was partially supported by Timur Absalyamov. We thank our colleagues from Kazan Federal University who provided insight and expertise that greatly assisted the research, although they may not agree with all of the conclusions of this paper. We thank Islam Fayzullin for assistance with particular methodology and Edward Madirov for comments that greatly improved the paper. We are also immensely grateful to Vladislav Zenin and Stanislav Zenin for their comments on an earlier version of the manuscript, although any errors are our own and should not tarnish the reputations of these esteemed persons.

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Saifullin, T., Lomovtseva, M. (2019). Information Services Industry in Tourism. In: Vasile, V. (eds) Caring and Sharing: The Cultural Heritage Environment as an Agent for Change. Springer Proceedings in Business and Economics. Springer, Cham. https://doi.org/10.1007/978-3-319-89468-3_4

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Business bulletin: 14 April 2024

Circular economy project rises to top at rural women’s award.

Territory entrepreneur, Tanya Egerton has been named the 2024 Northern Territory AgriFutures Rural Women’s winner for her sustainable, ethical and culturally-focused Indigenous enterprise, the Remote OpShop Project.

The AgriFutures Rural Women’s Award acknowledges and supports the critical role women play in rural and regional businesses, industries and communities.

It is an opportunity to celebrate the forward-thinking, courageous leaders who come from industries that represent some of the most vast and remote areas of the Northern Territory.

Ms Egerton, founder and CEO of Circulanation and the Remote OpShop Project, supports the establishment of opshops in remote First Nations communities, providing access to affordable items, while generating independent funding that supports culturally focused projects.

'My goal is to empower more local people to lead these community-owned and operated opshops, so they can drive better outcomes for their communities and the environment by participating in the circular economy,' Ms Egerton said.

'The Remote OpShop Project is developing a reuse and recycling hub ensuring high-quality, affordable goods are redirected from landfill and redistributed to remote First Nations communities, and thanks to the AgriFutures Rural Women’s Award, we will be able to scale with the development of a First Nations Leadership Council that will oversee this game-changing project.'

Ms Egerton received $15,000 from Wespact to further support her project as well as the opportunity to undertake a professional development course of her choosing.

Ms Egerton will go on to represent the Northern Territory at the Agrifutures Rural Women’s Award Gala dinner later this year.

The 2024 Northern Territory AgriFutures Rural Women’s Award finalist’s projects also included:

Rayleen Brown: for her project which focuses on skill and micro-enterprise development on-country with Central Australian women in the Indigenous bushfoods industry.
Rashida Khan: for her project ‘Spilling the Tea’ which is aimed at creating new ways for remote and rural Territorians to access mental health and wellbeing programs.
Rebecca Forrest: her project ‘Youth on Boards’ which focuses on increasing participation of young Territorians on boards and decision making forums.

For more information, visit the AgriFutures Australia website .

Enhancing the Aboriginal tourism industry

NT owned Aboriginal businesses and organisations can now access funding to develop or enhance tourism experiences and product that will encourage visitors to travel to and, stay longer in the Territory.

Aboriginal tourism is a significant drawcard for visitors to the Northern Territory with 80 per cent of visitors to the Territory seeking an Aboriginal tourism experience as part of their itinerary.

Round 7 of the Aboriginal Tourism Grant Program sees $1 million in funding available.

Under the program, eligible business and organisations can apply for grants between $30,000 and $100,000 to upgrade or build new infrastructure or develop a new tourism product which may include on country accommodation, cultural tours and bush tucker experiences.

Aboriginal cultural tourism has been identified by industry as a key priority for the tourism industry, which is reflected in the NT Tourism Industry Strategy 2030. The strategy sets the goal to build capacity and diversity in Aboriginal tourism and increase the offerings.

The Aboriginal Tourism Grant Program supports this goal by helping Aboriginal owned business and organisations develop their tourism products and continue to build stronger visitor experiences.

To date, the grant program has supported 52 Aboriginal tourism businesses with grants worth over $2.3 million.

This program is an initiative under the Northern Territory and Australian Governments $6 million Strategic Indigenous Tourism Projects. This investment is designed to strengthen Aboriginal Territorians participation in Australia’s tourism industry and deliver strong economic outcomes for the Northern Territory.

To find out more and to apply for Round 7 of the Aboriginal Tourism Grant Program visit the Northern Territory Government's GrantsNT website .

To learn more about the NT Tourism Industry Strategy 2030 visit the Tourism NT website .

NT Racing and Wagering Commission nominations now open

Nominations are now being sought for appointment to the NT Racing and Wagering Commission.

The Northern Territory Racing and Wagering Commission (NTRWC) was created under the Racing and Wagering Act 2024 (Act).

The NTRWC will replace the old Northern Territory Racing Commission and will come into effect on 1 July 2024.

The positions include:

Chairperson
Deputy Chairperson
legal member
2 other members.

Under the new Act the NTRWC have additional powers to oversee monitoring, complaints, disputes and disciplinary matters of licensed bookmakers.

The NTRWC will be responsible for:

licensing and regulating bookmakers
determining betting disputes
overseeing greyhound racing
investigating matters relating to racing in the Northern Territory.

All candidates must be residents of the Northern Territory, be fit and proper, and have a demonstrable knowledge or experience of thoroughbreds, harness or greyhound racing industries, the online wagering industry or broader online gambling industry.

Nominations are open until Wednesday, 1 May.

For more information or to submit a nomination, email [email protected] or contact 8999 1312 .

Skills development exchange program

The Indonesia-Australia Skills Development Exchange Pilot (the SDE Pilot) offers a dedicated pathway for skilled workers in Australia and Indonesia to undertake workplace placements in host organisations in the other country for up to 12 months.

The SDE Pilot was established under the Indonesia Australia Comprehensive Economic Partnership Agreement (IA-CEPA).

The SDE Pilot aims to build the workplace skills and cross-cultural competency of the pilot’s participants, while strengthening cooperation and cultural understanding between Australia and Indonesia.

The SDE Pilot is open to the following sectors:

agribusiness and food processing
the creative economy
financial and insurances services
the green economy
information media and telecommunications services
mining, engineering, and related technical services
tourism and travel related services.

Other sectors may be considered on a case-by-case basis, as agreed by Australia and Indonesia and subject to the views of industry stakeholders.

Key features of the SDE Pilot:

Indonesians coming to Australia can take placements in occupations defined at the ANZSCO Skill Levels 1-3 .
All participants can complement their work experience with relevant study or training, as agreed between the participant, their employer, and the hosting organisation.
Indonesian participants do not need to be sponsored by the Australian host organisation and labour market testing is not required.

All participants must hold relevant licensing or meet related requirements where required by the role and have adequate language proficiency. Placements need to comply with the workplace law in the jurisdiction in which the placement is hosted.

For more information about participating in the SDE Pilot contact DFAT at [email protected] or visit the Australian Government's Department of Foreign Affairs and Trade website .

Growing Central Australia’s care sector workforce

Territorians from diverse cultural and remote locations have come together to undertake training and professional development which will provide a boost to the care sector in Central Australia.

Response Employment and Training are delivering CHC42015 Certificate IV in Community Services to 22 participants at Desert Knowledge in Alice Springs. The course is funded by the Australian Government and Northern Territory Government’s Fee-Free TAFE program.

Central Australians undertaking this qualification are building valuable soft skills in communication, collaboration, technical skills in project management and the ability to proactively manage difficult situations

Kerry Rock, Senior Aged Care and Disability Trainer from Response RTO, has seen substantial professional growth in students during the program.

She said 'The course has seen students successfully develop essential skills, such as building confidence in public speaking, giving and receiving feedback, networking, and respecting cultural diversity.'

'Students have shown a genuine understanding of the importance of collaboration in improving outcomes for their clients in aged and disability support.'

Completing this nationally accredited course leads to more skilled professionals entering the local care workforce and enables career progression for those already in the sector. These skills are transferrable across a broad range of care sector roles, including aged care, disability support services, social work, and health, addressing skills shortages in regional and remote parts of the Northern Territory.

Kerry adds, 'The training has helped participants develop personal and professional confidence, preparing them for career growth and progression as team leaders, coordinators, and supervisors. It also provides skills and knowledge they can apply to potentially open and operate a small disability business.'

The students graduate in June, ready to boost the care sector workforce in Central Australia.

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40 facts about elektrostal.

Written by Lanette Mayes

Modified & Updated: 02 Mar 2024

Reviewed by Jessica Corbett

Elektrostal is a vibrant city located in the Moscow Oblast region of Russia. With a rich history, stunning architecture, and a thriving community, Elektrostal is a city that has much to offer. Whether you are a history buff, nature enthusiast, or simply curious about different cultures, Elektrostal is sure to captivate you.

This article will provide you with 40 fascinating facts about Elektrostal, giving you a better understanding of why this city is worth exploring. From its origins as an industrial hub to its modern-day charm, we will delve into the various aspects that make Elektrostal a unique and must-visit destination.

So, join us as we uncover the hidden treasures of Elektrostal and discover what makes this city a true gem in the heart of Russia.

Key Takeaways:

Elektrostal, known as the “Motor City of Russia,” is a vibrant and growing city with a rich industrial history, offering diverse cultural experiences and a strong commitment to environmental sustainability.
With its convenient location near Moscow, Elektrostal provides a picturesque landscape, vibrant nightlife, and a range of recreational activities, making it an ideal destination for residents and visitors alike.

Known as the “Motor City of Russia.”

Elektrostal, a city located in the Moscow Oblast region of Russia, earned the nickname “Motor City” due to its significant involvement in the automotive industry.

Home to the Elektrostal Metallurgical Plant.

Elektrostal is renowned for its metallurgical plant, which has been producing high-quality steel and alloys since its establishment in 1916.

Boasts a rich industrial heritage.

Elektrostal has a long history of industrial development, contributing to the growth and progress of the region.

Founded in 1916.

The city of Elektrostal was founded in 1916 as a result of the construction of the Elektrostal Metallurgical Plant.

Located approximately 50 kilometers east of Moscow.

Elektrostal is situated in close proximity to the Russian capital, making it easily accessible for both residents and visitors.

Known for its vibrant cultural scene.

Elektrostal is home to several cultural institutions, including museums, theaters, and art galleries that showcase the city’s rich artistic heritage.

A popular destination for nature lovers.

Surrounded by picturesque landscapes and forests, Elektrostal offers ample opportunities for outdoor activities such as hiking, camping, and birdwatching.

Hosts the annual Elektrostal City Day celebrations.

Every year, Elektrostal organizes festive events and activities to celebrate its founding, bringing together residents and visitors in a spirit of unity and joy.

Has a population of approximately 160,000 people.

Elektrostal is home to a diverse and vibrant community of around 160,000 residents, contributing to its dynamic atmosphere.

Boasts excellent education facilities.

The city is known for its well-established educational institutions, providing quality education to students of all ages.

A center for scientific research and innovation.

Elektrostal serves as an important hub for scientific research, particularly in the fields of metallurgy, materials science, and engineering.

Surrounded by picturesque lakes.

The city is blessed with numerous beautiful lakes, offering scenic views and recreational opportunities for locals and visitors alike.

Well-connected transportation system.

Elektrostal benefits from an efficient transportation network, including highways, railways, and public transportation options, ensuring convenient travel within and beyond the city.

Famous for its traditional Russian cuisine.

Food enthusiasts can indulge in authentic Russian dishes at numerous restaurants and cafes scattered throughout Elektrostal.

Home to notable architectural landmarks.

Elektrostal boasts impressive architecture, including the Church of the Transfiguration of the Lord and the Elektrostal Palace of Culture.

Offers a wide range of recreational facilities.

Residents and visitors can enjoy various recreational activities, such as sports complexes, swimming pools, and fitness centers, enhancing the overall quality of life.

Provides a high standard of healthcare.

Elektrostal is equipped with modern medical facilities, ensuring residents have access to quality healthcare services.

Home to the Elektrostal History Museum.

The Elektrostal History Museum showcases the city’s fascinating past through exhibitions and displays.

A hub for sports enthusiasts.

Elektrostal is passionate about sports, with numerous stadiums, arenas, and sports clubs offering opportunities for athletes and spectators.

Celebrates diverse cultural festivals.

Throughout the year, Elektrostal hosts a variety of cultural festivals, celebrating different ethnicities, traditions, and art forms.

Electric power played a significant role in its early development.

Elektrostal owes its name and initial growth to the establishment of electric power stations and the utilization of electricity in the industrial sector.

Boasts a thriving economy.

The city’s strong industrial base, coupled with its strategic location near Moscow, has contributed to Elektrostal’s prosperous economic status.

Houses the Elektrostal Drama Theater.

The Elektrostal Drama Theater is a cultural centerpiece, attracting theater enthusiasts from far and wide.

Popular destination for winter sports.

Elektrostal’s proximity to ski resorts and winter sport facilities makes it a favorite destination for skiing, snowboarding, and other winter activities.

Promotes environmental sustainability.

Elektrostal prioritizes environmental protection and sustainability, implementing initiatives to reduce pollution and preserve natural resources.

Home to renowned educational institutions.

Elektrostal is known for its prestigious schools and universities, offering a wide range of academic programs to students.

Committed to cultural preservation.

The city values its cultural heritage and takes active steps to preserve and promote traditional customs, crafts, and arts.

Hosts an annual International Film Festival.

The Elektrostal International Film Festival attracts filmmakers and cinema enthusiasts from around the world, showcasing a diverse range of films.

Encourages entrepreneurship and innovation.

Elektrostal supports aspiring entrepreneurs and fosters a culture of innovation, providing opportunities for startups and business development.

Offers a range of housing options.

Elektrostal provides diverse housing options, including apartments, houses, and residential complexes, catering to different lifestyles and budgets.

Home to notable sports teams.

Elektrostal is proud of its sports legacy, with several successful sports teams competing at regional and national levels.

Boasts a vibrant nightlife scene.

Residents and visitors can enjoy a lively nightlife in Elektrostal, with numerous bars, clubs, and entertainment venues.

Promotes cultural exchange and international relations.

Elektrostal actively engages in international partnerships, cultural exchanges, and diplomatic collaborations to foster global connections.

Surrounded by beautiful nature reserves.

Nearby nature reserves, such as the Barybino Forest and Luchinskoye Lake, offer opportunities for nature enthusiasts to explore and appreciate the region’s biodiversity.

Commemorates historical events.

The city pays tribute to significant historical events through memorials, monuments, and exhibitions, ensuring the preservation of collective memory.

Promotes sports and youth development.

Elektrostal invests in sports infrastructure and programs to encourage youth participation, health, and physical fitness.

Hosts annual cultural and artistic festivals.

Throughout the year, Elektrostal celebrates its cultural diversity through festivals dedicated to music, dance, art, and theater.

Provides a picturesque landscape for photography enthusiasts.

The city’s scenic beauty, architectural landmarks, and natural surroundings make it a paradise for photographers.

Connects to Moscow via a direct train line.

The convenient train connection between Elektrostal and Moscow makes commuting between the two cities effortless.

A city with a bright future.

Elektrostal continues to grow and develop, aiming to become a model city in terms of infrastructure, sustainability, and quality of life for its residents.

In conclusion, Elektrostal is a fascinating city with a rich history and a vibrant present. From its origins as a center of steel production to its modern-day status as a hub for education and industry, Elektrostal has plenty to offer both residents and visitors. With its beautiful parks, cultural attractions, and proximity to Moscow, there is no shortage of things to see and do in this dynamic city. Whether you’re interested in exploring its historical landmarks, enjoying outdoor activities, or immersing yourself in the local culture, Elektrostal has something for everyone. So, next time you find yourself in the Moscow region, don’t miss the opportunity to discover the hidden gems of Elektrostal.

Q: What is the population of Elektrostal?

A: As of the latest data, the population of Elektrostal is approximately XXXX.

Q: How far is Elektrostal from Moscow?

A: Elektrostal is located approximately XX kilometers away from Moscow.

Q: Are there any famous landmarks in Elektrostal?

A: Yes, Elektrostal is home to several notable landmarks, including XXXX and XXXX.

Q: What industries are prominent in Elektrostal?

A: Elektrostal is known for its steel production industry and is also a center for engineering and manufacturing.

Q: Are there any universities or educational institutions in Elektrostal?

A: Yes, Elektrostal is home to XXXX University and several other educational institutions.

Q: What are some popular outdoor activities in Elektrostal?

A: Elektrostal offers several outdoor activities, such as hiking, cycling, and picnicking in its beautiful parks.

Q: Is Elektrostal well-connected in terms of transportation?

A: Yes, Elektrostal has good transportation links, including trains and buses, making it easily accessible from nearby cities.

Q: Are there any annual events or festivals in Elektrostal?

A: Yes, Elektrostal hosts various events and festivals throughout the year, including XXXX and XXXX.

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Metallurgicheskii Zavod Electrostal AO (Russia)

In 1993 "Elektrostal" was transformed into an open joint stock company. The factory occupies a leading position among the manufacturers of high quality steel. The plant is a producer of high-temperature nickel alloys in a wide variety. It has a unique set of metallurgical equipment: open induction and arc furnaces, furnace steel processing unit, vacuum induction, vacuum- arc furnaces and others. The factory has implemented and certified quality management system ISO 9000, received international certificates for all products. Elektrostal today is a major supplier in Russia starting blanks for the production of blades, discs and rolls for gas turbine engines. Among them are companies in the aerospace industry, defense plants, and energy complex, automotive, mechanical engineering and instrument-making plants.

Headquarters Ulitsa Zheleznodorozhnaya, 1 Elektrostal; Moscow Oblast; Postal Code: 144002

Contact Details: Purchase the Metallurgicheskii Zavod Electrostal AO report to view the information.

Website: http://elsteel.ru

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