A new study shows just how much the loss of travel and tourism hurt the global economy during the pandemic — and how travel and tourism’s return is helping.
It’s no surprise that many communities around the world thrive on travel and tourism dollars. There are resort towns and other popular vacation destinations that would shrivel up and die without spending by visitors. But the more significant impact of travel and tourism on global GDP may surprise you.
The World Travel & Tourism Council (WTTC) has developed an Economic Impact Report in tandem with Oxford Economics. This report highlights travel and tourism’s impact on 185 countries and 25 geographic or economic regions. Comparing data from 2019 to data from 2020 and 2021 provides a unique glimpse into how COVID-19 disrupted the global economy and hurt GDP.
Travel and Tourism’s Impact on GDP Before the Pandemic
Travel and tourism accounted for 1 in 4 new jobs around the world before the pandemic. Workers in Travel and tourism across the globe also accounted for 10.3% of all jobs — a total of 333 million.
More than 10% of global GDP was driven by global travel and tourism, and much of that was provided by international travel. International visitors around the world spent $1.8 trillion in 2019.
Of course, 2019 was the last full year of normal travel activity prior to the pandemic. Comparing the 2019 numbers above to numbers from 2020 and 2021 provides a unique glimpse into how COVID-19 affected the travel and tourism industry as well as the global economy.
Travel and Tourism’s Impact on GDP After the Pandemic
Travel and tourism’s contribution to global GDP dropped by almost $4.9 trillion in 2020, a decrease of 50.4%. In 2021, travel and tourism’s contribution increased by $1 trillion (21.7%), but there remains a long way to go to get back to 2019 levels.
In 2020, the travel and tourism industry shed 62 million jobs, a decrease of 18.6%. The travel and tourism workforce that had reached 333 million in 2019 fell to just 271 million in 2020. More than 18 million of those jobs came back in 2021, but, again, there remains a gap between current employment levels and what the industry experienced in 2019.
Spending by international visitors was significantly affected, too. Spending fell 69.7% from 2019 to 2020, and it only bounced back by 3.9% in 2021.
Travel and Tourism in the United States
What about the United States? The U.S. was not immune to the effects of a travel shutdown, as indicated by travel and tourism’s contribution to GDP:
- 2019: 8.8% ($1.979 trillion)
- 2020: 4.8% ($1.042 trillion)
- 2021: 5.5% ($1.271 trillion)
Travel and tourism employment in the U.S. followed a similar pattern:
- 2019: 16.8 million
- 2020: 9.75 million
- 2021: 10.5 million
And spending by international visitors almost directly mirrors the global trend:
- 2019: $190.9 billion
- 2020: $39.8 billion
- 2021: $40.3 billion
Last year provided a small bump. Will 2022 provide a more significant increase in travel and tourism’s contribution to GDP, the number of those employed, and spending by international visitors?
Travel and Tourism in Europe
Trends across Europe closely mirror what the United States is experiencing. Here’s a look at how travel and tourism contribution to GDP has evolved over the past few years:
- 2019: 9.6% (€1.411 trillion)
- 2020: 5.6% (€0.773 trillion)
- 2021: 6.6% (€0.969 trillion)
If anything, travel and tourism thrived as a contributor to total employment across Europe during the pandemic. The numbers went down only slightly in 2020, and they almost bounced back to 2019 levels in 2021:
- 2019: 22.89 million
- 2020: 19.87 million
- 2021: 20.79 million
Spending by international visitors took a dramatic hit in Europe, and 2021’s spending was less than half of that in 2019:
- 2019: €444.8 billion
- 2020: €177.5 billion
- 2021: €218.6 billion
While spending by international visitors has been somewhat insulated from effects of the pandemic, most stats indicate that what the world is experiencing GDP-wise is the same that Europe is experiencing.
Business Travel’s Impact on Global GDP
Business travel has always been a huge factor in the economics of the travel and tourism industry. For example, business travelers make up 12% of all airline passengers, but they account for as much as 75% of airline profits. Travel remains critical to business growth, which is why companies are approaching pre-pandemic business travel levels.
The line between business and leisure travel is also starting to blur. A new concept called “bleisure” is emerging. Bleisure is when business Travelers add a few days to their trips for sightseeing and other activities. It’s a great perk to make available to your Travelers, and it also gives the overall travel industry a boost.
With business travel returning to nearly full force, expect the 2022 numbers on travel and tourism’s impact on GDP to be much closer to 2019 levels. This increase is good for the global economy — and good for all of the businesses that are operating in it.
Accelerate Your Return to Business Travel
Is your organization missing the benefits of business travel? If you’ve been slowly reengaging with business travel, JTB Business Travel can help you accelerate your return and achieve the ROI you want. We provide a series of products and services that help companies maximize their investment in business travel while helping Travelers enjoy comfortable, productive trips.
Contact us to learn more about returning to business travel safely and successfully.