Tourists returning to Australia tell the World Travel and Tourism Council

Melbourne saw a revival in 2021


The World Travel and Tourism Council (WTTC) has revealed positive signs of recovery for Australia’s travel and tourism sector, with major cities welcoming travelers again.

The Economic Impact of Cities Report, sponsored by Visa and researched in partnership with Oxford Economics, analyzes key indicators of travel and tourism in 82 cities around the world, including contribution to GDP, employment and traveler spending.

Analysis in Sydney, Melbourne and Perth shows that Travel & Tourism’s direct contribution to each city’s GDP and jobs continues to grow. But prolonged border closures in Australia and key markets such as China mean visitor spending is still low.

The contribution of the travel and tourism sector to GDP is steadily recovering

The WTTC Cities Economic Impact Report shows that in 2019 the city’s travel and tourism sector contributed over A$4.5 billion to the Perth economy and A$10 and A$13 billion respectively to the economies of Melbourne and Sydney.

But the pandemic has had a devastating effect on Australia’s national economy and the economies of its major cities as the border has been closed to foreign visitors.

In Perth, the contribution of travel and tourism to GDP fell by almost half (to just under A$2.5 billion) and in Sydney by almost two-thirds (to A$5 billion) in 2020. In Melbourne, the GDP contribution fell by almost three-quarters to just A$3 billion that year.

Melbourne saw a revival in 2021, rising to A$4 billion, but both Sydney and Perth saw sustained declines. Sydney fell to just over A$4 billion and Perth to just over A$2 billion.

All three cities are already showing signs of recovery, albeit at different rates.

Last year, Perth showed the slowest signs of recovery, with its GDP contribution forecast to halve 2019 to close to A$2.75 billion. Last year, the WTTC predicted Melbourne and Sydney would be just 25% and 27% below 2019 levels, at almost A$8 billion and A$9.5 billion respectively.

Julia Simpson, president and chief executive of WTTC, said: “Australia is an incredibly vibrant country, popular with overseas visitors, but as borders have remained closed at home and in Australia’s biggest source markets, the country has suffered for a longer period of time compared to other countries.

“With China opening up, the future looks bright for travel and tourism and the critical contribution it makes to Australia’s economy and jobs.
“It is vital that central and local government continue to recognize the economic and social importance of travel and tourism.

“The sector has shown its resilience and with the right support the recovery can be much faster and much stronger.”

Jobs are increasing

The job numbers paint a slightly mixed picture.

In 2019, there were just over 40,000 travel and tourism jobs in Perth. In 2020, this figure fell to just over 31,000, marking a slight increase to 34,000 in 2021, but is expected to fall again in 2022 to just under 27,500.

Both Melbourne and Sydney saw stronger job recovery in the sector. In Sydney, jobs in 2022 are expected to be just over 118.5,000, 16% below pre-pandemic levels, and in Melbourne, jobs are expected to be 115,000, just 6% below 2019.

Visitor spending continues to struggle

As tourists return to cities, we are seeing signs of a recovery in international visitor spending, albeit at a slower pace than many other major cities around the world due to Australia’s prolonged border closures.

While there are signs of a recovery in international visitors and more tourists returning to cities, it has taken longer in Australia due to its key markets, such as China, also extending their border closures.

But these three Australian cities are finally starting to recover. Although spending by international visitors was still on average 46% lower in 2022 than in 2019, all three cities showed strong year-over-year increases.

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