tourism sub sectors

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.

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• Travel Tips

What Is The Hospitality And Tourism Industry

Published: December 12, 2023

Modified: December 28, 2023

by Ingunna Whipple

• Hotel Reviews
• Sustainability

Introduction

Welcome to the exciting world of the hospitality and tourism industry! This dynamic and ever-growing sector offers an array of opportunities for those with a passion for travel, leisure, and providing exceptional customer experiences. In this article, we will explore the ins and outs of the hospitality and tourism industry, its definition, scope, key players, employment opportunities, challenges, and trends.

The hospitality and tourism industry encompasses a wide range of businesses and services that cater to the needs of travelers, tourists, and individuals seeking leisure activities. It includes establishments such as hotels, resorts, restaurants, airlines, cruise lines, travel agencies, theme parks, and more. These diverse entities all work together to create memorable experiences for guests and visitors.

As global travel continues to increase year after year, the hospitality and tourism industry plays a crucial role in the global economy. Not only does it provide employment opportunities to millions of people worldwide, but it also contributes to the growth of local economies and promotes cultural exchanges between different regions and countries.

Nowadays, people’s expectations for travel and hospitality experiences have evolved. It’s no longer just about offering a comfortable stay or a delicious meal; guests seek unique and personalized experiences that resonate with them. This shift has led to the rise of experiential travel, where travelers immerse themselves in the local culture, try authentic cuisines, and engage in activities that give them a deeper understanding of a destination.

The hospitality and tourism industry is driven by the concept of hospitality, which entails providing an exceptional level of service and attention to guests. Whether it’s warmly welcoming guests at a hotel, anticipating their needs at a restaurant, or ensuring smooth travel arrangements, hospitality professionals strive to create a positive and memorable experience for every visitor.

Furthermore, the industry’s success relies heavily on effective customer service and customer relationship management. Building strong relationships with guests and fostering loyalty are essential for businesses to thrive in this competitive landscape. Word-of-mouth recommendations and positive online reviews have a significant impact on a company’s reputation and customer acquisition.

As we delve deeper into the hospitality and tourism industry, we will uncover the various sub-sectors, discuss the employment opportunities they offer, explore the challenges faced by professionals in the field, and highlight the latest trends shaping the industry’s future. So, let’s embark on this journey together and discover the countless possibilities that await in the vast world of hospitality and tourism.

Definition of Hospitality and Tourism Industry

The hospitality and tourism industry is a dynamic and ever-evolving sector that encompasses a wide range of businesses and services. It revolves around providing exceptional customer experiences to individuals who are seeking leisure activities, travel, and accommodation. This industry plays a crucial role in the global economy, offering employment opportunities to millions of people worldwide and contributing to the growth of local economies.

At its core, the hospitality and tourism industry is defined by its focus on hospitality, which involves delivering outstanding service and creating memorable experiences for guests. Whether it’s a luxury hotel, a quaint bed and breakfast, a fine dining restaurant, or an adventurous travel agency, the industry is united by its commitment to catering to the needs and desires of travelers and tourists.

Tourism, a significant component of the industry, refers to the activities individuals engage in when visiting different destinations. These activities can include sightseeing, exploring cultural landmarks, participating in outdoor adventures, and immersing oneself in the local culture. The tourism sector relies on various services within the hospitality industry to provide comfortable accommodation, dining options, transportation, and entertainment.

The hospitality and tourism industry includes a wide array of businesses and services:

• Hotels and resorts: These establishments provide accommodation for travelers, ranging from budget-friendly options to luxury experiences.
• Restaurants and food services: From casual dining to Michelin-starred restaurants, these establishments offer a variety of culinary experiences.
• Travel agencies and tour operators: These organizations assist individuals in planning and booking their travel arrangements, including flights, accommodations, and itinerary.
• Airlines, cruise lines, and transportation services: These companies facilitate the movement of travelers, providing air, sea, and land transportation options.
• Entertainment and attractions: Theme parks, museums, historical sites, and other attractions offer leisure activities and entertainment for tourists.
• Event planning and management: This sector handles the organization and execution of various events, such as conferences, weddings, and corporate functions.

The hospitality and tourism industry is highly customer-oriented and focuses on creating positive experiences that meet and exceed the expectations of guests. It requires individuals with excellent communication skills, attentiveness, problem-solving abilities, and a genuine passion for providing top-notch service.

As the industry continues to evolve, the definition of hospitality and tourism has expanded beyond traditional boundaries. It now encompasses new trends such as eco-tourism, wellness tourism, experiential travel, and the integration of technology in enhancing guest experiences. This adaptability ensures that the industry remains relevant and responsive to the changing preferences and demands of travelers worldwide.

Scope and Importance of the Hospitality and Tourism Industry

The scope of the hospitality and tourism industry is vast and encompasses a wide range of activities, businesses, and services. From providing accommodation and dining options to organizing travel arrangements and offering entertainment, this industry plays a crucial role in shaping the experiences of travelers and tourists worldwide.

One of the primary purposes of the hospitality and tourism industry is to cater to the needs and desires of individuals seeking leisure activities and travel experiences. It offers a diverse range of services that provide comfort, convenience, and entertainment to guests, ensuring their satisfaction and enjoyment.

One of the key aspects of the industry’s scope is the provision of accommodation options. Hotels, resorts, bed and breakfasts, and other lodging establishments offer visitors a place to stay while exploring a destination. These accommodations can range from budget-friendly options to luxury suites, catering to the preferences and budgets of various travelers.

In addition to accommodation, the industry also encompasses an array of dining options. Restaurants, cafes, food trucks, and other establishments provide visitors with the opportunity to sample local cuisine, indulge in gourmet experiences, or simply grab a quick bite to eat. These dining experiences often add a cultural element to travelers’ journeys, allowing them to savor the flavors of a particular region or country.

The transportation sector is another critical component of the industry’s scope. Airlines, cruise lines, car rental services, and other transportation providers ensure that individuals can reach their desired destinations conveniently and safely. This seamless connectivity helps facilitate travel and allows visitors to explore multiple locations during their trips.

Entertainment and attractions are also significant contributors to the industry’s scope. Theme parks, museums, historical sites, natural landmarks, and other attractions offer leisure activities and unique experiences for tourists. These destinations play a vital role in attracting visitors, increasing local tourism, and promoting cultural exchanges.

The importance of the hospitality and tourism industry cannot be overstated. Economically, it generates substantial revenue for destinations, stimulates local businesses, and creates employment opportunities for millions of people worldwide. It supports a wide range of industries, including hospitality, transportation, food and beverage, and retail.

Socially, the industry encourages cultural exchange, promoting understanding and appreciation of different cultures and traditions. It fosters connections between people from diverse backgrounds, enabling the exchange of ideas, customs, and perspectives.

Furthermore, the hospitality and tourism industry contributes to the preservation and promotion of natural and cultural heritage. By highlighting and showcasing these assets, it raises awareness about the importance of conservation and sustains the value of unique landmarks and ecosystems.

Key Players in the Hospitality and Tourism Industry

The hospitality and tourism industry consists of numerous key players, each playing a crucial role in delivering exceptional experiences to travelers and tourists. These players include a diverse range of businesses and organizations that contribute to the overall success and growth of the industry.

Hotels and resorts are major players in the industry, offering accommodation options to guests. This includes luxury chains, boutique hotels, budget-friendly establishments, and everything in between. These properties provide a variety of amenities and services to ensure a comfortable and enjoyable stay for visitors.

Restaurants and food services are also significant players in the hospitality and tourism industry. From high-end fine dining establishments to casual cafes and street food vendors, these businesses cater to the culinary needs of travelers and locals alike. They offer a wide range of cuisines, flavors, and dining experiences to satisfy diverse palates.

Travel agencies and tour operators play a vital role in planning and organizing travel arrangements. These players assist individuals and groups in booking flights, accommodations, transportation, and activities. They curate itineraries, provide expert guidance, and offer personalized recommendations to create unforgettable travel experiences.

Airlines and cruise lines are essential players in the transportation sector of the industry. They facilitate travel by air and sea, connecting travelers to various destinations around the world. These players focus on providing safe, efficient, and comfortable travel options for guests, ensuring a seamless journey from start to finish.

Attractions and entertainment providers contribute to the industry’s vibrancy and appeal. Theme parks, museums, zoos, national parks, and cultural heritage sites offer unique and engaging experiences for visitors. They showcase local history, art, nature, and provide opportunities for entertainment and adventure.

Event planning and management companies are important players in the industry, organizing conferences, conventions, weddings, and other events. They ensure that every aspect of an event, from venue selection to logistics and execution, meets the highest standards and exceeds the expectations of attendees.

Tourist boards and destination marketing organizations (DMOs) play a critical role in promoting tourism and attracting visitors to specific destinations. They collaborate with businesses, governments, and local communities to develop marketing campaigns, initiatives, and strategies aimed at showcasing the unique offerings and attractions of a place.

In addition to these key players, technology companies have also become increasingly important in the hospitality and tourism industry. Online travel agencies (OTAs), hotel booking platforms, and travel review websites have transformed the way travelers search, book, and review accommodations and experiences. The integration of technology has revolutionized the industry, providing greater convenience and options for travelers.

Collaboration and synergy between these key players are essential for the industry’s success. By working together, they can create seamless, memorable experiences for travelers, enhance destination offerings, and drive the growth and sustainability of the hospitality and tourism industry as a whole.

Sub-Sectors of the Hospitality and Tourism Industry

The hospitality and tourism industry is vast and comprises several sub-sectors that cater to the diverse needs and preferences of travelers and tourists. These sub-sectors offer specialized services and experiences, contributing to the overall richness and appeal of the industry. Let’s explore some of the key sub-sectors:

Hotels and Accommodation: This sub-sector includes various types of lodging options, ranging from luxury hotels and resorts to budget-friendly motels and hostels. It encompasses full-service hotels, boutique properties, bed and breakfasts, serviced apartments, and vacation rentals. Each lodging category provides different amenities, styles, and experiences to cater to the needs of travelers.

Food and Beverage: Restaurants, cafes, bars, and food services form an integral part of the hospitality industry. This sub-sector caters to both locals and tourists, offering a wide array of culinary delights that showcase local and international cuisines. From fine dining establishments to street food vendors, the food and beverage sub-sector delivers diverse and memorable dining experiences.

Travel and Tourism Agencies: This sub-sector encompasses travel agencies, tour operators, and online travel agencies (OTAs). These entities specialize in organizing and facilitating travel arrangements for individuals and groups. Whether it’s booking flights, accommodations, transportation, or activities, travel agencies play a pivotal role in creating seamless and hassle-free travel experiences for customers.

Transportation: Airlines, cruise lines, car rental services, and transportation companies fall under this sub-sector. They ensure the smooth movement of travelers from one destination to another. Airlines connect cities and countries through air travel, while cruise lines offer leisurely journeys by sea. Car rental services and transportation companies provide options for convenient and efficient travel within destinations.

Entertainment and Attractions: This sub-sector comprises a variety of attractions and entertainment venues that enhance the overall travel experience. Theme parks, museums, art galleries, amusement parks, zoos, botanical gardens, and cultural heritage sites all fall under this category. These attractions offer visitors the opportunity to explore local history, culture, and natural beauty, providing unique and engaging experiences.

Event Planning and Management: This sub-sector specializes in organizing and managing various events, such as conferences, conventions, weddings, and exhibitions. Event planning companies coordinate every aspect of an event, including venue selection, logistics, catering, and audiovisual arrangements. They ensure that events run smoothly and leave a lasting impression on attendees.

Destination Marketing: Tourist boards and destination marketing organizations (DMOs) play a crucial role in this sub-sector. They promote specific destinations, highlighting their unique attractions, cultural heritage, and activities to attract visitors. DMOs collaborate with local businesses, governments, and communities to develop marketing campaigns and initiatives that boost tourism and drive economic growth.

Technology and Online Platforms: This emerging sub-sector encompasses technology companies that provide online booking platforms, travel review websites, and other travel-related services. These platforms have revolutionized the way travelers plan, book, and review accommodations and experiences. Through the integration of technology, travelers have access to a vast array of choices and can personalize their travel experiences.

Each sub-sector of the hospitality and tourism industry plays a vital role in creating a comprehensive and enjoyable travel experience. By working together, these sub-sectors contribute to the overall success and growth of the industry, ensuring that travelers have a plethora of options and experiences to choose from.

Employment Opportunities in the Hospitality and Tourism Industry

The hospitality and tourism industry offers a vast array of employment opportunities for individuals with a passion for customer service, travel, and creating memorable experiences. From entry-level positions to managerial roles, this diverse industry provides a wide range of careers that cater to different skills, interests, and qualifications.

Overall, the hospitality and tourism industry is a dynamic and promising field for employment. It offers a wide range of opportunities for individuals seeking a career that combines their passion for travel, customer service, and creating unforgettable experiences. Whether it’s in hotels, restaurants, travel agencies, attractions, or event planning, there is a career path for individuals with diverse backgrounds and interests in this ever-evolving industry.

Challenges and Trends in the Hospitality and Tourism Industry

The hospitality and tourism industry operates in a dynamic and highly competitive environment, continuously evolving to meet the changing needs and expectations of travelers. While the industry offers numerous opportunities, it also faces various challenges. Let’s explore some of the key challenges and trends shaping the industry today.

Challenges:

1. Economic Factors: Economic instability, fluctuating currency rates, and geopolitical issues can significantly impact the industry. Economic downturns can lead to reduced travel budgets and lower consumer spending, affecting businesses’ profitability and sustainability.

2. Seasonality and Demand Variability: Many tourist destinations experience peaks and troughs in visitor numbers due to seasonality. Managing staffing levels, inventory, and operations to meet fluctuating demand can be a complex challenge for businesses.

3. Competition: The industry is highly competitive, with businesses constantly vying for customers. From large hotel chains to online travel agencies and local establishments, businesses must differentiate themselves and offer unique experiences to attract and retain guests.

4. Changing Consumer Behavior: Consumers’ preferences and expectations are continually evolving. Travelers now seek experiential travel, personalized recommendations, sustainable practices, and seamless digital experiences. Adapting to these changing demands requires continual innovation and investment in technology.

5. Technological Advancements: While technology presents opportunities for growth, it also poses challenges. Online booking platforms, review websites, and social media influence consumer decisions and can impact a business’s reputation. Staying up-to-date with technological advancements and leveraging them strategically is key to staying competitive.

1. Sustainable and Responsible Tourism: In response to growing environmental concerns, travelers are embracing sustainable and responsible tourism practices. Businesses are implementing eco-friendly policies, reducing waste, and supporting local communities to meet the rising demand for environmentally conscious travel experiences.

2. Experiential Travel: Travelers are seeking immersive and authentic experiences. They want to connect with local cultures, participate in unique activities, and explore off-the-beaten-path destinations. Businesses are catering to these desires by offering curated experiences, cultural immersion programs, and adventure tourism options.

3. Personalization and Customization: Personalization is a key trend in the industry. Travelers appreciate tailored recommendations and experiences that cater to their specific preferences and interests. Businesses are utilizing technology and data analytics to understand customer preferences and provide personalized offers and services.

4. Technology Integration: Technology continues to transform the industry, with advancements such as artificial intelligence, virtual reality, and mobile apps enhancing customer experiences. Key trends include mobile check-ins, contactless payments, chatbots for customer service, and personalized digital concierge services.

5. Rise of Sharing Economy: The sharing economy, represented by platforms such as Airbnb and Uber, has disrupted traditional hospitality and transportation sectors. It has provided travelers with alternative accommodation options and transportation choices, forcing businesses to adapt and find innovative ways to compete.

By staying informed about these challenges and trends, businesses in the hospitality and tourism industry can adapt their strategies, invest in technology, and provide exceptional experiences that meet the evolving needs and expectations of travelers. The industry’s ability to navigate these challenges and embrace trends will determine its success and resilience in the ever-evolving global marketplace.

The hospitality and tourism industry holds immense potential as a thriving and vibrant sector that caters to the needs of travelers and tourists worldwide. Throughout this article, we have explored the definition, scope, key players, employment opportunities, challenges, and trends of this dynamic industry.

The industry’s definition is centered around providing exceptional service and creating memorable experiences for guests. It encompasses a wide range of businesses and services, including hotels, restaurants, travel agencies, airlines, attractions, and event planning organizations.

The scope and importance of the hospitality and tourism industry cannot be understated. It drives economic growth, generates employment opportunities, fosters cultural exchange, and promotes the preservation of natural and cultural heritage.

The key players in the industry each play a significant role in delivering outstanding experiences to travelers, ensuring their comfort, satisfaction, and enjoyment during their journeys.

The numerous sub-sectors within the industry, such as hotels, food and beverage, travel agencies, attractions, event planning, and technology, offer diverse employment opportunities for individuals with a range of skills and interests.

While the industry presents exciting opportunities, it also faces challenges, including economic factors, competition, changing consumer behavior, and technological advancements. Businesses must embrace these challenges and stay attuned to the latest trends in order to provide exceptional experiences and stay competitive.

The trends shaping the industry, including sustainable and responsible tourism, experiential travel, personalization, technology integration, and the rise of the sharing economy, offer new avenues for growth and innovation for businesses in the industry.

In conclusion, the hospitality and tourism industry is a dynamic and ever-evolving sector that offers a wide range of opportunities for individuals seeking a career that combines their passion for travel, customer service, and creating unforgettable experiences. By adapting to changing consumer preferences, embracing technology, and providing exceptional service, businesses in the industry can continue to thrive and contribute to the growth and success of this exciting and vital industry.

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• Hospitality Industry

8 lucrative career paths in the hospitality and tourism industry

March 08, 2024 •

8 min reading

The hospitality field is one of the most encompassing industries in the world. It can include every element of vacation, tourism and recreation experiences. This is something our EHL graduates quickly learn as the hospitality industry red carpet rolls out in every possible direction after graduation. When you have hospitality training and experience on your resume, your career potential becomes boundless.

While hospitality may be defined by the hotel industry, the true options are far more vast than you may have imagined. Your skills can take you anywhere in the world, working with any aspect of travel and leisure, from management to experience coordination to supply chain. If you are considering your next step in an illustrious hospitality career , we would like to spotlight eight different career paths that you might take, each encompassing a large sector of the hospitality industry.

Here are eight common sectors where our students find success after graduation.

• Accommodation
• Food & Beverage
• Event Planning
• Sports & Recreation
• Entertainment
• Wellness & Leisure

Careers in accommodation

The accommodation sector has never been more diverse. While there are millions of hotels and resorts around the world, there are also many other types of accommodation you might coordinate, creating perfect vacation experiences of every size and style. There are vacation rentals and, luxury accomodation from palaces and 5-star hotels to luxury rentals. There are cabins, cottages, and destination lodges as well as campgrounds and RV parks. You can help hotels expand their accommodation offerings beyond interior rooms or cultivate unique properties and accommodation experiences.

In another branch, you can take your hospitality experience into the corporate world, helping to facilitate corporate housing which fulfills the needs of traveling, temporary, and relocated professionals who are working away from home. According to the Bureau of Labor Statistics (BLS), 2023 featured nearly 2 million jobs in Accommodation in the US alone.

Each branching accommodation path provides the opportunity to create exquisite stays with the perfect balance of comfort, convenience, and logistics.

Traversing the travel industry

The travel industry often scoops up a percentage of hospitality professionals. 2023 saw over 320 million travel jobs worldwide. Airports and airline hosts rely on hospitality to make air travel more comfortable for their passengers.

Cruise ships make up an enormous global industry and specialize in diverse hospitality experiences from prow to stern. Royal Caribbean Cruises, Carnival, and Norwegian offer the greatest number of cruise ship jobs, but you may have just as much fun with a smaller cruise line that travels coasts that you love.

You can step into the specialized world of chartered travel including chartered planes , boats, helicopters. Or you can join a large travel company providing your hospitality expertise wherever it is needed most. If you love trains, rail travel offers a truly unique opportunity to create on-train hospitality experiences, especially those few great trans-continental train lines still in operation for both tourism and long-distance travel.

Immerse in food & beverage

Our foodie graduates often dive into the experience-rich world of the food and beverage industry. There is simply no end to the food-oriented job opportunities , and these take every possible shape and form.

You could be coordinating banquets for hotel-hosted events or managing a gourmet restaurant anywhere in the world. You can become a caterer or coordinate for a large catering company or you can open your own food establishment somewhere with plenty of demand and tourism to fill your seats.

Food and beverage professionals can join any venue, including theaters, stadiums, event halls, grand hotels, cruise ships, restaurants and restaurant chains - you can even coordinate food for museums, schools, large business facilities, or food truck empires . The possibilities are literally endless, as the food and beverage industry touches every aspect of modern life. 

Become an event planning expert

Events are the spice of life. Weddings, conferences, festivals, fashion shows, concerts, theater productions; the list is endless. The BLS predicts 7.5% employment growth for events planning from 2022 to 2032.

You can choose a venue, a favorite event type, or work for an organization that puts on one spectacular event each year. A skilled events coordinator is someone who makes unforgettable moments and large gatherings into a guaranteed success.

Skills that hospitality graduates learn through education and internship are critical for event planning. Highly organized people who thrive in chaos and love adapting to unexpected challenges will typically do well in the events industry. You will also get a chance to work with celebrities of every possible type, from Ted Talk tech leaders to pop stars and Michelin star chefs.

You will build your name making magical events possible, creating impossibly entertaining environments that are also expertly designed to provide everything event-goers and vendors need to bring the experience together.

Creating tourism experiences

Tourism is the art of putting together full-scope travel experiences. There are many areas of tourism, professional in this field arranges tour packages, plans whole trips, or coordinates or hosts excursions for traveling clients.

As people embrace the idea of travel experiences over more chaotic destination immersion, the tourism sector only continues to grow. According to ILO, over 230 million people work in tourism worldwide. This is more than just being a travel agent or a tour guide. Venues, destinations, and even whole cities hire tourism professionals to coordinate desirable tourism packages that will entice visitors to take specific journeys through the available experiences at each destination.

Tourism jobs include destination management, tour package design, personal travel planning, tour coordination, and a certain amount of special event planning. In fact, the tourism industry becomes complex as coordinated events are further integrated into hospitality and travel packages.

If you enjoy many aspects of the hospitality world, enjoying things like wedding planning, travel planning, museum experiences, foodie tours , and personally ensuring that travelers have a wonderful time; tourism might be the perfect career path.

The world of sports & recreation

There is no denying that sports plays a profound role in the travel and hospitality industry. People will cross the world to see their favorite sports team play in an big game - or to experience legendary golf courses in breathtaking global destinations. Some chase the waves for surf and high-adrenaline water sports, some want to swim over every magnificent coral reef that the world's oceans have to offer.

Sports and recreation is a vast sector of the hospitality industry, and one you could become a master of - connecting travelers with the thrilling experiences they have been dreaming about. A sports and recreation professional will specialize in exciting experiences, and you can operate from either end of the process.

You can become a destination coordinator, finding tourists who want to experience the locations and activities of your organization, or you can approach from the travel direction - directing travelers toward the venues and activities they desire. If you understand that need for thrills, personal challenge, and unforgettable moments, you will be able to bond with your clients and help them truly capture the destination sports and recreation experiences they are looking for.

To learn more about what to expect in a hospitality education, chat today with real EHL students about their experience .

The glamorous entertainment industry

Hospitality has always been a gateway into the world of fame and entertainment . Legendary hotels, resorts, and destination venues are often the location of major shows, hosting concerts, after-parties, and other events that become part of celebrity tours. Other venues are popular locations for charity galas and fundraiser events where the rich and famous gather to do their philanthropic work and rub elbows with those who share a different kind of wealth and power.

The BLS predicts jobs in entertainment and recreation management are growing by 8% , which is well above the occupational average.

If you have always wanted to make these glamorous moments into reality with a chance to meet and endless parade of people whose faces are known across the globe, entertainment hospitality is the path for you.

Luxurious wellness and leisure

Perhaps the fastest-growing sector of the hospitality industry, however, is wellness and leisure . It has seen 40% growth through 2023 and is one of the leading growth sectors in the US alone. "Wellness" has become a concept that you see everywhere. It is something we are all focusing on, and in every aspect of life. Mental wellness, workplace wellness, physical wellness, and luxurious wellness are at the top of everyone's mind. It's no surprise that spas, massage studios, salons, and leisure facilities are rapidly growing in ever aspect of hospitality.

Today, when people travel, they want to experience more wellness and luxuriant relaxation than ever before. Every business trip should include at least one day at the spa . Every family vacation will likely include a girl's day out getting pampered. Even eco-tourists are seeking out secluded hot springs and organic facials. Some seek out yoga, pilates, and fitness classes. Some go on retreats or try a guided meditation course. The possibilities are endless.

This vast and growing sector can be found anywhere people travel or vacation. If you specialize in wellness and leisure, you'll find work in every corner of the industry and the world.

The limitless career options of EHL Hospitality Graduates

At EHL, we proudly prepare our students for an illustrious career in the hospitality industry. Your options are not limited just to the traditional roles surrounding hotels or tourism, however. Hospitality is a truly vast industry that encompasses every aspect of travel, events, and experiences. From the many styles of booked accommodation to unique destinations and leisure experiences all over the world - once you are equipped with the hospitality skills and intern experiences learned through EHL education, your potential career paths become truly limitless.

Let your passion and natural talents guide you toward the best path for you. Do you love organizing chaos and seeing events come together? Go into event and venue coordination. Do you love all things food and gourmet? Find your place in the food and beverage world. If you are enchanted by unique experiences, help others find their bliss in tourism or sports recreation. Or, if bliss is your specialty, guide others to the wellness treatments they need to return home feeling refreshed and energized.

Best of all, hospitality skills allow you to pivot at any moment, trying a new branch of the hospitality industry wherever your desire and job opportunities may take you. It all starts here, at EHL hospitality education.

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Travel, Tourism & Hospitality

Global tourism industry - statistics & facts

What are the leading global tourism destinations, digitalization of the global tourism industry, how important is sustainable tourism, key insights.

Detailed statistics

Total contribution of travel and tourism to GDP worldwide 2019-2033

Number of international tourist arrivals worldwide 1950-2023

Global leisure travel spend 2019-2022

Editor’s Picks Current statistics on this topic

Current statistics on this topic.

Leading global travel markets by travel and tourism contribution to GDP 2019-2022

Travel and tourism employment worldwide 2019-2033

Related topics

Recommended.

• Hotel industry worldwide
• Travel agency industry
• Sustainable tourism worldwide
• Travel and tourism in the U.S.
• Travel and tourism in Europe

Recommended statistics

• Basic Statistic Total contribution of travel and tourism to GDP worldwide 2019-2033
• Basic Statistic Travel and tourism: share of global GDP 2019-2033
• Basic Statistic Leading global travel markets by travel and tourism contribution to GDP 2019-2022
• Basic Statistic Global leisure travel spend 2019-2022
• Premium Statistic Global business travel spending 2001-2022
• Premium Statistic Number of international tourist arrivals worldwide 1950-2023
• Basic Statistic Number of international tourist arrivals worldwide 2005-2023, by region
• Basic Statistic Travel and tourism employment worldwide 2019-2033

Total contribution of travel and tourism to gross domestic product (GDP) worldwide in 2019 and 2022, with a forecast for 2023 and 2033 (in trillion U.S. dollars)

Travel and tourism: share of global GDP 2019-2033

Share of travel and tourism's total contribution to GDP worldwide in 2019 and 2022, with a forecast for 2023 and 2033

Total contribution of travel and tourism to GDP in leading travel markets worldwide in 2019 and 2022 (in billion U.S. dollars)

Leisure tourism spending worldwide from 2019 to 2022 (in billion U.S. dollars)

Global business travel spending 2001-2022

Expenditure of business tourists worldwide from 2001 to 2022 (in billion U.S. dollars)

Number of international tourist arrivals worldwide from 1950 to 2023 (in millions)

Number of international tourist arrivals worldwide 2005-2023, by region

Number of international tourist arrivals worldwide from 2005 to 2023, by region (in millions)

Number of travel and tourism jobs worldwide from 2019 to 2022, with a forecast for 2023 and 2033 (in millions)

• Premium Statistic Global hotel and resort industry market size worldwide 2013-2023
• Premium Statistic Most valuable hotel brands worldwide 2023, by brand value
• Basic Statistic Leading hotel companies worldwide 2023, by number of properties
• Premium Statistic Hotel openings worldwide 2021-2024
• Premium Statistic Hotel room openings worldwide 2021-2024
• Premium Statistic Countries with the most hotel construction projects in the pipeline worldwide 2022

Global hotel and resort industry market size worldwide 2013-2023

Market size of the hotel and resort industry worldwide from 2013 to 2022, with a forecast for 2023 (in trillion U.S. dollars)

Most valuable hotel brands worldwide 2023, by brand value

Leading hotel brands based on brand value worldwide in 2023 (in billion U.S. dollars)

Leading hotel companies worldwide 2023, by number of properties

Leading hotel companies worldwide as of June 2023, by number of properties

Hotel openings worldwide 2021-2024

Number of hotels opened worldwide from 2021 to 2022, with a forecast for 2023 and 2024

Hotel room openings worldwide 2021-2024

Number of hotel rooms opened worldwide from 2021 to 2022, with a forecast for 2023 and 2024

Countries with the most hotel construction projects in the pipeline worldwide 2022

Countries with the highest number of hotel construction projects in the pipeline worldwide as of Q4 2022

• Premium Statistic Airports with the most international air passenger traffic worldwide 2022
• Premium Statistic Market value of selected airlines worldwide 2023
• Premium Statistic Global passenger rail users forecast 2017-2027
• Premium Statistic Daily ridership of bus rapid transit systems worldwide by region 2023
• Premium Statistic Number of users of car rentals worldwide 2019-2028
• Premium Statistic Number of users in selected countries in the Car Rentals market in 2023
• Premium Statistic Carbon footprint of international tourism transport worldwide 2005-2030, by type

Airports with the most international air passenger traffic worldwide 2022

Leading airports for international air passenger traffic in 2022 (in million international passengers)

Market value of selected airlines worldwide 2023

Market value of selected airlines worldwide as of May 2023 (in billion U.S. dollars)

Global passenger rail users forecast 2017-2027

Worldwide number of passenger rail users from 2017 to 2022, with a forecast through 2027 (in billion users)

Daily ridership of bus rapid transit systems worldwide by region 2023

Number of daily passengers using bus rapid transit (BRT) systems as of April 2023, by region

Number of users of car rentals worldwide 2019-2028

Number of users of car rentals worldwide from 2019 to 2028 (in millions)

Number of users in selected countries in the Car Rentals market in 2023

Number of users in selected countries in the Car Rentals market in 2023 (in million)

Carbon footprint of international tourism transport worldwide 2005-2030, by type

Transport-related emissions from international tourist arrivals worldwide in 2005 and 2016, with a forecast for 2030, by mode of transport (in million metric tons of carbon dioxide)

Attractions

• Premium Statistic Leading museums by highest attendance worldwide 2019-2022
• Basic Statistic Most visited amusement and theme parks worldwide 2019-2022
• Basic Statistic Monuments on the UNESCO world heritage list 2023, by type
• Basic Statistic Selected countries with the most Michelin-starred restaurants worldwide 2023

Leading museums by highest attendance worldwide 2019-2022

Most visited museums worldwide from 2019 to 2022 (in millions)

Most visited amusement and theme parks worldwide 2019-2022

Leading amusement and theme parks worldwide from 2019 to 2022, by attendance (in millions)

Monuments on the UNESCO world heritage list 2023, by type

Number of monuments on the UNESCO world heritage list as of September 2023, by type

Selected countries with the most Michelin-starred restaurants worldwide 2023

Number of Michelin-starred restaurants in selected countries and territories worldwide as of July 2023

Online travel market

• Premium Statistic Online travel market size worldwide 2017-2028
• Premium Statistic Estimated desktop vs. mobile revenue of leading OTAs worldwide 2023
• Premium Statistic Number of aggregated downloads of leading online travel agency apps worldwide 2023
• Basic Statistic Market cap of leading online travel companies worldwide 2023
• Premium Statistic Estimated EV/Revenue ratio in the online travel market 2024, by segment
• Premium Statistic Estimated EV/EBITDA ratio in the online travel market 2024, by segment

Online travel market size worldwide 2017-2028

Online travel market size worldwide from 2017 to 2023, with a forecast until 2028 (in billion U.S. dollars)

Estimated desktop vs. mobile revenue of leading OTAs worldwide 2023

Estimated desktop vs. mobile revenue of leading online travel agencies (OTAs) worldwide in 2023 (in billion U.S. dollars)

Number of aggregated downloads of leading online travel agency apps worldwide 2023

Number of aggregated downloads of selected leading online travel agency apps worldwide in 2023 (in millions)

Market cap of leading online travel companies worldwide 2023

Market cap of leading online travel companies worldwide as of September 2023 (in million U.S. dollars)

Estimated EV/Revenue ratio in the online travel market 2024, by segment

Estimated enterprise value to revenue (EV/Revenue) ratio in the online travel market worldwide as of April 2024, by segment

Estimated EV/EBITDA ratio in the online travel market 2024, by segment

Estimated enterprise value to EBITDA (EV/EBITDA) ratio in the online travel market worldwide as of April 2024, by segment

Selected trends

• Premium Statistic Global travelers who believe in the importance of green travel 2023
• Premium Statistic Sustainable initiatives travelers would adopt worldwide 2022, by region
• Premium Statistic Airbnb revenue worldwide 2017-2023
• Premium Statistic Airbnb nights and experiences booked worldwide 2017-2023
• Premium Statistic Technologies global hotels plan to implement in the next three years 2022
• Premium Statistic Hotel technologies global consumers think would improve their future stay 2022

Global travelers who believe in the importance of green travel 2023

Share of travelers that believe sustainable travel is important worldwide in 2023

Sustainable initiatives travelers would adopt worldwide 2022, by region

Main sustainable initiatives travelers are willing to adopt worldwide in 2022, by region

Airbnb revenue worldwide 2017-2023

Revenue of Airbnb worldwide from 2017 to 2023 (in billion U.S. dollars)

Airbnb nights and experiences booked worldwide 2017-2023

Nights and experiences booked with Airbnb from 2017 to 2023 (in millions)

Technologies global hotels plan to implement in the next three years 2022

Technologies hotels are most likely to implement in the next three years worldwide as of 2022

Hotel technologies global consumers think would improve their future stay 2022

Must-have hotel technologies to create a more amazing stay in the future among travelers worldwide as of 2022

• Premium Statistic Travel and tourism revenue worldwide 2019-2028, by segment
• Premium Statistic Distribution of sales channels in the travel and tourism market worldwide 2018-2028
• Premium Statistic Inbound tourism visitor growth worldwide 2020-2025, by region
• Premium Statistic Outbound tourism visitor growth worldwide 2020-2025, by region

Travel and tourism revenue worldwide 2019-2028, by segment

Revenue of the global travel and tourism market from 2019 to 2028, by segment (in billion U.S. dollars)

Distribution of sales channels in the travel and tourism market worldwide 2018-2028

Revenue share of sales channels of the travel and tourism market worldwide from 2018 to 2028

Inbound tourism visitor growth worldwide 2020-2025, by region

Inbound tourism visitor growth worldwide from 2020 to 2022, with a forecast until 2025, by region

Outbound tourism visitor growth worldwide 2020-2025, by region

Outbound tourism visitor growth worldwide from 2020 to 2022, with a forecast until 2025, by region

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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.

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.

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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 tourism sector provides opportunities for developing countries to create productive and inclusive jobs, grow innovative firms, finance the conservation of natural and cultural assets, and increase economic empowerment, especially for women, who comprise the majority of the tourism sector’s workforce. Before the COVID-19 pandemic, tourism was the world’s largest service sector—providing one in ten jobs worldwide,  almost seven percent of all international trade and  25 percent of the world’s service exports —a critical foreign exchange generator.  In 2019 the sector was valued at more than US$9 trillion and accounted for 10.4 percent of global GDP.

Tourism offers opportunities for economic diversification and market-creation. When effectively managed, its deep local value chains can expand demand for existing and new products and services that directly and positively impact the poor and rural/isolated communities. The sector can also be a force for biodiversity conservation, heritage protection, and climate-friendly livelihoods, making up a key pillar of the blue/green economy. This potential is also associated with social and environmental risks, which need to be managed and mitigated to maximize the sector’s net-positive benefits.

The impact of the COVID-19 pandemic has been devastating for tourism service providers, with a loss of 20 percent of all tourism jobs (62 million), and US$1.3 trillion in export revenue, leading to a reduction of 50 percent of its  contribution to GDP  in 2020 alone. The collapse of demand has severely impacted the livelihoods of tourism-dependent communities, small businesses and women-run enterprises. It has also reduced government tax revenues and constrained the availability of resources for destination management and site conservation.

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Tourism and Competitiveness Strategic Pillars

Our solutions are integrated across the following areas:

• Competitive and Productive Tourism Markets. We work with government and private sector stakeholders to foster competitive tourism markets that create productive jobs, improve visitor expenditure and impact, and are supportive of high-growth, innovative firms. To do so we offer guidance on firm and destination level recovery, policy and regulatory reforms, demand diversification, investment promotion and market access. 
• Blue, Green and Resilient Tourism Economies. We support economic diversification to sustain natural capital and tourism assets, prepare for external and climate-related shocks, and be sustainably managed through strong policy, coordination, and governance improvements. To do so we offer support to align the tourism enabling and policy environment towards sustainability, while improving tourism destination and site planning, development, and management. We work with governments to enhance the sector’s resilience and to foster the development of innovative sustainable financing instruments.
• Inclusive Value Chains. We work with client governments and intermediaries to support Small and Medium sized Enterprises (SMEs), and strengthen value chains that provide equitable livelihoods for communities, women, youth, minorities, and local businesses. 

The successful design and implementation of reforms in the tourism space requires the combined effort of diverse line ministries and agencies, and an understanding of the impact of digital technologies in the industry. Accordingly, our teams support cross-cutting issues of tourism governance and coordination, digital innovation and the use and application of data throughout the three focus areas of work.

Tourism and Competitiveness Theory of Change 

Examples of our projects:

• In Indonesia , a US$955m loan is supporting the Government’s Integrated Infrastructure Development for National Tourism Strategic Areas Project. This project is designed to improve the quality of, and access to, tourism-relevant basic infrastructure and services, strengthen local economy linkages to tourism, and attract private investment in selected tourism destinations. In its initial phases, the project has supported detailed market and demand analyses needed to justify significant public investment, mobilized integrated tourism destination masterplans for each new destination and established essential coordination mechanisms at the national level and at all seventeen of the Project’s participating districts and cities.
• In Madagascar , a series of projects totaling US$450m in lending and IFC Technical Assistance have contributed to the sustainable growth of the tourism sector by enhancing access to enabling infrastructure and services in target regions. Activities under the project focused on providing support to SMEs, capacity building to institutions, and promoting investment and enabling environment reforms. They resulted in the creation of more than 10,000 jobs and the registration of more than 30,000 businesses. As a result of COVID-19, the project provided emergency support both to government institutions (i.e., Ministry of Tourism) and other organizations such as the National Tourism Promotion Board to plan, strategize and implement initiatives to address effects of the pandemic and support the sector’s gradual relaunch, as well as to directly support tourism companies and workers groups most affected by the crisis. 
• In Sierra Leone , an Economic Diversification Project has a strong focus on sustainable tourism development.  The project is contributing significantly to the COVID-19 recovery, with its focus on the creation of six new tourism destinations, attracting new private investment, and building the capacity of government ministries to successfully manage and market their tourism assets.  This project aims to contribute to the development of more circular economy tourism business models, and support the growth of women- run tourism businesses.  
• Through the Rebuilding Tourism Competitiveness: Tourism Response, Recovery and Resilience to the COVID-19 Crisis initiative and the Tourism for Development Learning Series , we held webinars, published insights and guidance notes as well as formed new partnerships with Organization of Eastern Caribbean States, United Nations Environment Program, United Nations World Tourism Organization, and World Travel and Tourism Council to exchange knowledge on managing tourism throughout the pandemic, planning for recovery and building back better. The initiative’s key Policy Note has been downloaded more than 20,000 times and has been used to inform recovery initiatives in over 30 countries across 6 regions.
• The Global Aviation Dashboard  is a platform that visualizes real-time changes in global flight movements, allowing users to generate 2D & 3D visualizations, charts, graphs, and tables; and ranking animations for: flight volume, seat volume, and available seat kilometers.  Data is available for domestic, intra-regional, and inter-regional routes across all regions, countries, airports, and airlines on a daily, weekly, or monthly basis from January 2020 until today. The dashboard has been used to track the status and recovery of global travel and inform policy and operational actions.

Traditional Samburu women in Kenya. Photo: hecke61/Shutterstock.

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• Destination Management Handbook: A Guide to the Planning and Implementation of Destination Management  (2023)
• Blue Tourism in Islands and Small Tourism-Dependent Coastal States : Tools and Recovery Strategies (2022)
• Resilient Tourism: Competitiveness in the Face of Disasters  (2020)
• Tourism and the Sharing Economy: Policy and Potential of Sustainable Peer-to-Peer Accommodation  (2018)
• Supporting Sustainable Livelihoods through Wildlife Tourism  (2018)
• The Voice of Travelers: Leveraging User-Generated Content for Tourism Development  (2018)
• Women and Tourism: Designing for Inclusion  (2017)
• Twenty Reasons Sustainable Tourism Counts for Development  (2017)
• An introduction to tourism concessioning:14 characteristics of successful programs.  The World Bank, 2016)
• Getting financed: 9 tips for community joint ventures in tourism . World Wildlife Fund (WWF) and World Bank, (2015)
• Global investment promotion best practices: Winning tourism investment” Investment Climate  (2013)

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• COVID-19 and Tourism in South Asia: Opportunities for Sustainable Regional Outcomes  (2020)
• Demand Analysis for Tourism in African Local Communities  (2018)
• Tourism in Africa: Harnessing Tourism for Growth and Improved Livelihoods . Africa Development Forum (2014)

COVID-19 Response

• Expecting the Unexpected : Tools and Policy Considerations to Support the Recovery and Resilience of the Tourism Sector (2022)
• Rebuilding Tourism Competitiveness. Tourism response, recovery and resilience to the COVID-19 crisis  (2020)
• COVID-19 and Tourism in South Asia Opportunities for Sustainable Regional Outcomes  (2020)  
• WBG support for tourism clients and destinations during the COVID-19 crisis  (2020)
• Tourism for Development: Tourism Diagnostic Toolkit  (2019)
• Tourism Theory of Change  (2018)

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• COVID Impact Mitigation Survey Results  (South Africa) (2020)
• COVID Preparedness for Reopening Survey Results  (South Africa) (2020)
• COVID Study  (Fiji) (2020) with   IFC

Featured Blogs

• Fiona Stewart, Samantha Power & Shaun Mann ,  Harnessing the power of capital markets to conserve and restore global biodiversity through “Natural Asset Companies”   | October 12 th  2021
• Mari Elka Pangestu ,  Tourism in the post-COVID world: Three steps to build better forward  | April 30 th  2021
• Hartwig Schafer ,  Regional collaboration can help South Asian nations rebuild and strengthen tourism industry  | July 23 rd  2020
• Caroline Freund ,  We can’t travel, but we can take measures to preserve jobs in the tourism industry  | March 20 th  2020

Featured Webinars

• Destination Management for Resilient Growth . This webinar looks at emerging destinations at the local level to examine the opportunities, examples, and best tools available. Destination Management Handbook
• Launch of the Future of Pacific Tourism. This webinar goes through the results of the new Future of Pacific Tourism report. It was launched by FCI Regional and Global Managers with Discussants from the Asian Development Bank and Intrepid Group.
• Circular Economy and Tourism . This webinar discusses how new and circular business models are needed to change the way tourism operates and enable businesses and destinations to be sustainable.
• Closing the Gap: Gender in Projects and Analytics .  The purpose of this webinar is to raise awareness on integrating gender considerations into projects and provide guidelines for future project design in various sectoral areas.
• WTO Tourism Resilience: Building forward Better. High-level panelists from Sri Lanka, Costa Rica, Jordan and Kenya discuss how donors, governments and the private sector can work together most effectively to rebuild the tourism industry and improve its resilience for the future.
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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.

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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International travel plays a critical role in the US economy. Prior to the COVID-19 pandemic, in 2019, international visitors spent $233.5 billion experiencing the United States; injecting nearly $640 million a day into the U.S. economy. The U.S. travel and tourism industry generated $1.9 trillion in economic output; supporting 9.5 million American jobs and accounted for 2.9% of U.S. GDP. At 14.5% of international travel spending globally, international travelers spend more in the United States than any other country. As recovery efforts continue, the International Trade Administration actively supports the industry via the twin pillars of the National Travel and Tourism Office (NTTO) and the U.S. Commercial Service . Working together, we provide a range of data and related products to support the international outreach and promotion efforts of U.S. destinations and attractions. With over 100 offices throughout the United States and in 75 countries around the world, we are where you are and where you want to be.

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Challenges and the importance of skills in tourism sub-sectors during and after Covid-19

In this two series blog, the Next Tourism Generation (NTG) Consortium present the communication of Impact of Covid-19 on skills development and employability in the tourism sector  in terms of challenges related to skills development, how such challenges may change and what the impacts may be on tourism sub-sectors during and after the crisis. In this blog, NTG focuses on the importance of the development of skills and potential impacts on the sub-sectors during and after the Covid-19 crisis.

Covid-19 has had a major impact on the tourism and hospitality industry in Europe. NTG, therefore, consulted Consortium partners on the impact of Covid-19 on digital, green and social skills development and employability skills, including the challenges that the sub-sectors in tourism and hospitality are facing.

Attractiveness of tourism and hospitality education and an industry career

In tourism education, the biggest challenge is to persuade students not to neglect the importance of tourism education. Many students may prefer to change their future career pathway because of the high risk and additional regulations in the hospitality and tourism industries. Another dilemma is how students can get practical work experience e.g. internships at tourism and hospitality companies if there are restrictions that make it almost impossible to work at the location itself?

However, the Covid-19 situation also leads to the fact that businesses have to let go of their comfort zone, this is the time to upskill the digital skills of staff. For example, by providing training on the right digital tools and programs that can make their work more efficient once tourists and visitors are allowed to return to the tourist sites, accommodations and visitor attractions. Nevertheless, it is also a big challenge for businesses in these uncertain times to keep talented staff in-house.

Challenges and opportunities for sub-sectors in tourism and hospitality

The Next Tourism Generation Alliance focuses on five sub-sectors in tourism and hospitality and the Consortium gave their views on how the Covid-19 crisis has impacted on each of these sectors.

Destination management organizations (DMOs )

Due to visitor attractions being closed, residents are longing for nature-based activities resulting in a high peak in visitors in nature such as hiking trails. However, destinations that featured overtourism such as Barcelona and Venice are currently seeing the positive outcomes of the minimization of tourist arrivals: dolphins in the waters of Venice and crystal-clear waters. Therefore, DMOs are currently being forced to think about rebuilding their destinations for post-Covid-19 times. Visitor management has always been a relevant and important skill for employers and employees in DMOs, but knowledge and experience of such strategies are becoming crucial in these times.

Accommodation

This sub-sector is facing a major challenge: opening hotels again requires effective communication between employers, employees and customers to ensure staff and guests follow the hygienic-sanitary rules and recommendations to help gain the confidence of customers. However, for many destinations in Europe, it is not clear yet when and how different types of accommodation providers will open again, resulting in a cut in personnel or a rise in part-time employees instead of employees being able to work full-time.

Visitor attractions

Currently, visitor attraction organizations are trying to find solutions on how to implement the social distancing regulations in their attraction sites, a very challenging task which requires flexibility. Furthermore, communication between staff and visitors also needs to be done in an excellent way in order to maintain the social distancing rules. Therefore, communication skills will be crucial in the upcoming months.

F&B operations

The workers in the accommodation and food services sector that have the lowest annual earnings and the lowest levels of education of all sectors indicate the way in which the pandemic may serve to reinforce already substantial disparities in income. Indirectly, the pandemic shines a light on social welfare and job security in tourism, with differences in service employment models underlining vulnerabilities. In Italy, restaurants can prepare takeaway food and on June 1 st , the reopening is foreseen but the reorganization of the spaces hypothesized by government measures imposes structural limits that will reduce capacity and number of places opening.

Tour operators and travel agencies

The biggest task that Tour Operators and Travel Agencies are currently coping with are the cancellations of bookings, postponing travel and the forecast for traveling. Yield management will be of crucial importance whereas it is yet unclear how organizations will have to deal with social distancing, matching with the health restrictions with the required general occupancy rate to continue business as usual. A major transformation is awaiting for example in travel arrangements, reorganization and the change in the market. New circumstances will appear and require flexibility from organizations in order to grasp new opportunities and to survive in a new economy with new demands from new types of customers.

Required skills needed in times of Covid-19

The NTG Skills Matrix has identified digital, social and green skills which are of importance for various occupational levels in the sub-sectors. Regarding Covid-19, the Consortium has had a look at the most relevant and required skills needs in times of Covid-19 and the after-phase.

Read blog 2: Skills sets in education and the tourism and hospitality industry in corona times  

Follow the efforts of the Next Tourism Generation via our website, Facebook, Twitter | #NTGskillsalliance or via LinkedIn

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What are Sectors of Tourism? Accommodation, Transportation, Intermediaries

• Post last modified: 28 August 2021
• Reading time: 15 mins read
• Post category: Tourism

What are Sectors of Tourism?

Tourism is an economic, environmental, and socio-cultural phenomenon. It reaches various sectors of the economy and society and it involves many different forms, such as leisure tourism, sports tourism, cultural tourism, business tourism, conference, and exhibition tourism, tourism for religious reasons, and Eco-tourism.

Table of Content

• 1 What are Sectors of Tourism?
• 2 Sectors of Tourism
• 3.1 Resort Hotel
• 3.2 Airport Hotel
• 3.3 Bed & Breakfast (B&B)
• 4.1 Transport by Air
• 4.2 Transport by Sea or Water
• 4.3 Road Transport
• 4.4 Rail Transport
• 5.1 Types of Intermediaries
• 5.2 Travel Agencies
• 5.3 Tour Operators
• 5.4 Corporate client travel agencies
• 5.5 Sightseeing tour companies
• 6 Merits of using Intermediaries (Travel Agency)

The broad nature of tourism makes it quite difficult to be defined and there is no universally accepted definition of it As tourism development has both positive and negative effects on the tourist location, the study will also discuss what are the factors reducing the positive effects of tourism and then what strategies should be adopted in order to reduce the negative effects and maximize the positive.

Sectors of Tourism

These are some various sectors of the tourism industry:

Accommodation

• Transportation
• Intermediaries

Accommodation is a temporary home for travelers. It ranges from simple sleeping places to deluxe suites for eating, entertainment, and sleeping. Travelers can stay overnight in any kind of lodging from an African treehouse to a castle in Europe.

The accommodation industry is made up of hotels, motels (motor hotels), resort hotels, campgrounds, hostels, and guesthouses. Hotels are classified in various ways. One of the most common ways is by location, such as resort, city center, airport, suburban, or highway.

Types of Hotels:

Resort Hotel

Airport hotel, bed & breakfast (b&b).

A resort hotel can be considered as a destination itself. It offers a full range of services and amenities for the guests to enjoy their vacations within the property. Typical features of a resort hotel include restaurants, shops, sporting facilities, pools, spas, casinos, and even private beaches.

Examples: 1. Hong Kong Gold Coast Hotel , 2. Mission Hills Resort Shenzhen in China .

Airport hotels are located in or near airports. This type of accommodation is selected by travelers for necessity. A major feature of airport properties is convenient for early morning departures or late evening arrivals. It is mainly for airline crew members and passengers with overnight layovers r canceled flights.

Example: Hong Kong Regal Airport Hotel .

B&B is a guest house or private house providing clean, attractive accommodation and breakfast. The B&Bs offer a home-like atmosphere. The owner of the B&B usually lives on the premises and provides all the necessary labor. Community breakfasts with other lodgers and hosts enhance this atmosphere.

The other way of classification is rating (grading), for example, five-star, four-star, three-star, two-star hotels. This grading system is commonly used in China.

Types of Transportation

There are a number of different types of transportation modes: air, water, road and rail. The various types of transport modes can be subdivided into:

Transport by Air

Transport by sea or water, road transport, rail transport.

Air Transport First-class travelers enjoy the privacy of their own private cabin area with seats that can be converted into 6’6″ flatbeds. Plenty of good food, in-flight entertainment, and a personal video screen is provided.

They are also welcome to use the arrivals lounge. Business-class travelers have wide comfortable seats with plenty of legroom. They can also enjoy good food, free drinks, and complimentary newspapers. Economy-class travelers though have narrower seats, still are provided with suitable services and meals.

In general, most of the airlines provide different classes on board; they are first, business and economy class. Some airlines nowadays introduced ‘premium economy class’. This class of service offers better individual service (e.g. more comfortable seat) to passengers at a lower price comparing with business-class service.

What is a cruise? A cruise is a vacation trip by ship. This definition excludes traveling by water for primarily transportation purposes. It offers the passengers a chance to relax in comfortable surroundings, with attentive service, good food, and a liner that changes the scenery from time to time.

Despite the potential positive impact of cruise tourism to the local economy, there is also a danger the local tourism industry faces is that cruise tourism can displace other forms of tourism as hotels and tours fill with cruise passengers, reducing the capacity for other tourists.

Cruise ships are basically self-contained destinations where guests live, eat, are entertained, and travel. Cruises are voyages taken for pleasure and not only for the purpose of transport. Most cruises start and end at the same port. A cruise with all-inclusive fare nowadays may combine:

Transportation costs such as airfare between cruise passengers’ point of origin and the destination port. Sometimes the cost of accommodation at the destination port is included in the all-inclusive fare.

Traveling by road is the most flexible and economical form of mass transportation. Modern motorway networks have made major cities easily accessible.

Coach Services

• Local Service.
• Regional – between Hong Kong and Shenzhen.
• International express services – services between Canada and United States in North America.
• Tour and sightseeing operations.
• Shuttle buses for airport transfers.

Car Services

Car travelers have greater freedom in choosing their route, destination, and timing of their journey. Examples are Private cars for rental, Taxis, Private cars.

Business and vacation travelers book car rentals for different reasons. Business travelers are looking for a convenient and reliable form of ground transportation to get them from point A to point B with the minimum amount of fuss and bother.

Vacation travelers are looking for a comfortable form of transportation to places where they plan to visit but these places are not easily accessible by public transportation.

The importance of rail travel has given way to private cars and air travel, but is picking up now since a number of services have been designed specifically for the tourist trade on a local and international level.

Examples include “Orient Express” in Europe and “Indian-Pacific” across Australia. Others include the “Trans-Siberian Railway” and the “Bullet Train” of Japan.

Examples of Other Rail Transport: Underground train services in a most urban city, Airport express train service; and Scenic rails.

One of the world’s eminent traveling experiences is to travel on a luxury train. Traversing the world’s varied landscapes along alternative train routes, the train combines all the comfort and luxury of a five-star hotel with a globally unparalleled journey.

Intermediaries in Tourism

Intermediaries are “Middle-Men”, acting as a link between the customer and the supplier. In the travel business, the suppliers consist of airlines, cruise and ferry companies, coach/bus companies, railways, hotels and motels, and car rental agencies.

The customers include holidaymakers, business travelers, and those visiting friends and relatives.

Tourism and the Structure of the Tourism Industry Travel agencies, in their role as “middlemen,” combine tourism activities originally carried out on an unconnected, individual basis, linking customers with tourism service suppliers and thereby promoting the development of the tourism industry.

Tourism service suppliers include airlines, hotels, restaurants, car hire companies, and companies that operate reception services at destinations.

Types of Intermediaries

Types of Intermediaries are chiefly divided into two categories:

Travel Agencies

Tour operators.

Appointed representatives such as tourism service suppliers or wholesalers are authorized to sell customers a series of tourism-related products and services such as airline tickets, cruise liner berths, hotel rooms, car rentals, and train tickets, etc.

Their role is to provide guests with relevant tourism consultant services, book travel products on behalf of customers, and provide special services for customers in accordance with their needs, etc. Their income is mainly derived from agency commissions.

• Wholesalers.
• Inbound travel agencies/outbound travel agencies.

Wholesalers buy large volumes of products at a relatively low price from tourism service suppliers such as transport companies, hotels, and tourist attractions, and then sell them to tourism retailers that then sell to the retail market.

They won’t normally sell travel products directly to the general public. However, some powerful travel agencies will also establish retail departments to sell these products directly to customers.

There are also some wholesalers that are operated by a number of airlines and chain hotels and promote package tours put together from their own products.

Retailers order large volumes of various different types of travel products from tourism service suppliers or wholesalers such as transport companies, hotel, and tourist attraction products and services, then design and combine these individual products and add in their own services such as tour guide services, etc., turning them into packaged travel products, which are then sold to customers.

Outbound tour groups will take locals to another city or country and provide travel products such as transport, accommodation, and tickets to tourist attractions. Generally speaking.

This type of intermediary will regularly organize groups to take people from Hong Kong all over the world, wherein they will be accompanied by a group leader or tour guide from the very start.

Corporate client travel agencies

Sightseeing tour companies, merits of using intermediaries (travel agency), please share this share this content.

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THSC unveils report highlighting sector’s demand and skill gap

The Tourism and Hospitality Skill Sector Council (THSC) has launched its highly anticipated report on the Demand And Skill Gap, alongside the Annual Industry Partners Meet. The Annual Industry Partners Meet 2024 was conducted under the theme of “Navigating the Future: Bridging Skill Gaps for the Tourism and Hospitality Industry.” This launch event, in collaboration with industry partners, took place at the Gulmohar Hall, India Habitat Centre, New Delhi, drawing stakeholders from across the nation.

Atul Kumar, Secretary, Ministry of Skill Development and Entrepreneurship, in the presence of esteemed dignitaries representing the National Skill Development Corporation and Industry.

In an era marked by rapid globalization and evolving consumer demands, the tourism and hospitality sector stand at a critical juncture. India’s tourism and hospitality sector has demonstrated resilience following the COVID-19 pandemic and is poised for further growth. It currently contributes 7.5% to India’s GDP, amounting to US$3420 billion, making it a significant contributor within the services sector. In 2022, the industry employed 39 million people, equivalent to 8% of India’s total employment, with US$22 million in forex earnings from January to October 2023 and 1.7 billion domestic tourist visits within India in 2023.

Recognizing the pivotal role played by skilled professionals in upholding the ongoing economic vitality, the Tourism and Hospitality Sector Skill Council has embarked on an expansive nationwide research endeavor.

A demand and skill gap study was deemed necessary due to evolving consumer preferences, government focus on niche sectors, and advancements in technology. The study aimed to address changing customer preferences such as adventure tourism, eco/sustainable tourism, wellness and medical tourism, and entrepreneurial aspirations. Additionally, it considered the government’s emphasis on niche sub-sectors like cruise tourism, rural tourism, and religious tourism, along with the impact of advancing technologies such as big data, artificial intelligence, and automation.

Rajan Bahadur, CEO, THSC stated, “We aim to develop and deliver educational programs focusing on practical skills to empower young individuals to excel in the global hospitality industry. Our commitment extends beyond mere training; we aspire to cultivate a workforce equipped not only with technical expertise but also with the adaptability and creativity necessary to thrive in an ever-evolving landscape. With a vision to bridge the existing skill gaps, our efforts are geared towards fostering a culture of continuous learning and innovation within the sector, ensuring its sustained growth and competitiveness on the global stage.”

At the Ministry of Skill Development and Entrepreneurship, we acknowledge the pivotal role of the tourism sector in the ‘Viksit Bharat’ initiative. Recognizing its significance for GDP growth and overall national development, we are committed to fostering both domestic and foreign tourism. To achieve this, collaboration between the Ministry of Tourism, NSDC, and NCVET is imperative. We must reimagine our approach, starting with integrating tourism education into the school curriculum and offering industry-aligned degree courses. Our efforts also extend to bridging skill gaps through comprehensive sector-wide studies. Together, we aim to elevate India’s tourism appeal and promote a skilled workforce, ultimately contributing to the nation’s prosperity,” said Atul Kumar Tiwari, Secretary, Ministry of Skill Development and Entrepreneurship.

The study employed a multi-stage stratified random sampling approach, identifying 121 districts across 20 states and 6 union territories, focusing on prominent tourism circuits. The sample included 553 employers and over 10,000 youth, across various demographics.

Key findings indicated that 51% of surveyed youth preferred working in hotels, 31% in tours & travels, and the remainder in facility management. Some youths from specific states expressed interest in relocating for better job prospects. Additionally, there was a notable interest in gig work among youth, but concerns were raised regarding its lack of structure and limited career advancement opportunities.

Employers highlighted the need for skills such as problem-solving, communication, literacy, and team management, with one-third providing training facilities. However, cost constraints and high employee attrition hindered training efforts. The industry’s technological adoption was low, but there was an intention to increase it, particularly in digital reservation and payment technologies.

Emerging jobs identified include chef entrepreneurs, airline hospitality, and tech-friendly tour guides, with emerging skills such as data analysis, revenue management, and socio-emotional skills.

The study estimated that 5.7 million youth could be trained to meet an expected incremental labour demand of 3 million workers between 2025-2028. However, challenges such as low wages and long working hours deterred youth from continuing in the industry.

The Skill Gap report launch was followed by an Industry Partner meet which revolved around “Navigating the Future: Bridging Skill Gaps for the Tourism and Hospitality Industry.” The agenda encompassed a series of pertinent discussions and presentations aimed at addressing key challenges and opportunities within the sector. 

Scheduled sessions included insightful presentations on the implementation of the Direct Benefit Transfer (DBT) framework under the National Apprenticeship Promotion Scheme (NAPS), a panel discussion focusing on the multifaceted challenges and issues encountered by the industry, particularly concerning the demand-supply gap and the efficacy of the Recruit, Train, and Deploy model, as well as deliberations on the Recognition of Prior Learning (RPL) and the significance of Corporate Social Responsibility (CSR).

The event culminated with the presentation of awards to industry partners who demonstrated exceptional commitment and effectiveness in fostering the skill of youth within the sector.

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Moscow City Tourism Committee

The Tourism Committee, or Mostourism, is the executive body of the Moscow City Government that oversees tourist activities in the capital. The Committee is responsible for legislative initiatives, congress and exhibition activities, and event and image projects. As the brand manager for an attractive tourism image for Moscow, Mostourism constantly analyses global trends, offers Russian and foreign tourists what they want, and also uncovers new opportunities for the capital in terms of interesting and rewarding leisure activities.

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Moscow extends a warm welcome to Indian travellers with enhanced infrastructure and hidden gems

Russia actively promoting moscow as a tourist destination for indian travellers, improving infrastructure and visa process..

Russia is making an active bid to attract Indian travellers to visit Moscow -- a huge megalopolis and the historical, political and spiritual heart of the Russian Federation. The Moscow City Tourism Committee is promoting the city not only as a cultural capital but also as a business hub as it plans to onboard trade partners, tourists and vacationers. Moscow has also strengthened cooperation with the tourism sectors of allied nations, hosting familiarization tours for delegates and arranging business trips to showcase the city's tourism potential.

To accommodate visitors, Moscow is improving its infrastructure: signs are now available in English and Chinese, all announcements on public transport are repeated in English, and hotels are also adapting to cater to the needs of guests from various countries and ensure a comfortable stay. "We are still on our way to restore the flow of Indian tourists in Moscow like it used to be before the pandemic," said Bulat Nurmukhanov, Head of International Cooperation Division of Moscow City Tourism Committee.

Bulat further said that before the pandemic, there was a steady growth of 12-15 per cent on a year-on-year basis. In the first half of the year, Moscow received about 20,000 Indians, compared to the same period a year ago, it is about 56 per cent higher. In a bid to make Moscow a must-visit destination, the committee is actively working on improving the infrastructure for international travellers. Moscow is spearheading the development of innovative standards in catering to the needs of foreign travellers.

Tourists arriving in the capital can stay in hotels of various price segments. They can savour traditional Russian cuisine, and can also indulge in a diverse culinary experience, with options ranging from authentic Indian delicacies to continental dishes prepared to the highest standards. In 2022, the number of foreign tourists who visited Moscow increased by 6.3 per cent compared to 2021, reaching a total of 1.7 million.

Travelling to Moscow has now become easier as tourists from India and 54 other countries can apply for an electronic visa to enter Russia from August 1, 2023. The impact of e-visa rollout would be available by October this year after the quarterly data from the Russian border control agencies is analysed, Bulat said.

Moreover, the Russian government is planning to come out with a virtual 'Foreign Tourist Card' that will enable cashless payments for various services. "The idea behind this card is, a person back home in India can remotely apply for this card and then he/she can transfer money from the personal bank account to this bank account," Bulat added.

Meanwhile, sources in the Indian Embassy in Moscow told reporters that the Indian tourism ministry as well as the governments of Goa and Kerala are slated to participate in roundtable discussions this month. There are also plans to engage social media influencers to improve the inward traffic to India. Before the pandemic, around 3 lakh Russian tourists visited India annually. The numbers are down to around 80,000-90,000 of late.

To facilitate easy visitor movement across the city, there is "Discover Moscow" -- a navigation and travel web portal about Moscow and "RUSSPASS travel service" -- a digital platform designed for planning trips across Russia. The Discover Moscow portal features descriptions of over 1,200 architectural landmarks in Moscow. The site provides news, digests with festival and event information and curated lists of exhibition venues.

By availing the RUSSPASS travel service, tourists can access all essential information for a trip to Moscow on the site, including visa and currency matters, accommodation and transportation options in the capital. The site also offers a trip builder feature, allowing tourists to select pre-designed city routes or create their own itinerary from their favourite locations. There are versions of the site in Russian, English, Spanish and Arabic.

On the cultural scene, Moscow boasts 10,000 cultural venues including theaters, museums, libraries, parks, cinemas, concert halls, and more. In the last decade, around 900 parks and green spaces have been renovated.

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