Monday, June 24, 2013

Year over Year spending per worker in direct travel and tourism sector is down but up in the indirect, support sector. Is this a good sign or bad?

Just how important is the economic impact of  tourism in the US(from BLS current release)?

In the first quarter of 2013, total current-dollar tourism-related spending was $1.5 trillion and consisted of $888.5 billion (59 percent) of direct tourism spending — goods and services sold directly to visitors — and $606.2 billion (41 percent) of indirect tourism-related spending — goods and services used to produce what visitors purchase.
Total Tourism-Related Employment  was 7.9 million jobs in the first quarter of 2013 and consisted of 5.7 million (71 percent) direct tourism jobs — jobs where workers produce goods and services sold directly to visitors — and 2.2 million (29 percent) indirect tourism-related jobs — jobs where workers produce goods and services used to produce what visitors purchase.

Total direct and indirect spending on and tourism for the months of January, February and April of 2013 was $1.5 Trillion dollars and it help sustained 7.9 million jobs (both in RED). If you divide $1.5T by 7.9M each job was supported by $189,873 in average spending on tourism/travel for the 3 months. 

If you just look at direct spending and direct jobs, if you divide $888.5B by 5.7M each job was supported by $155,877 in average spending on tourism/travel for the 3 months.  

Just to give some perspective and consistency, lets look at the First Quarter period from 2012.  It is common to compare year-over-year changes to see what the seasonal trend might be.


In the first quarter of 2012, total current-dollar tourism-related spending was $1.4 trillion and consisted of $848.6 billion (59 percent) of direct tourism spending — goods and services sold directly to visitors — and $577.9 billion (41 percent) of indirect tourism-related spending — goods and services used to produce what visitors buy.
Total Tourism-Related Employment was 7.6 million in the first quarter of 2012 and consisted of 5.4 million (71 percent) direct tourism jobs — jobs where workers produce goods and services sold directly to visitors — and 2.2 million (29 percent) indirect tourism-related jobs — jobs where workers produce goods and services used to produce what visitors buy.

If we do the same calculations using the numbers in RED and BLUE we see that an average total spending (direct + indirect) worked out to $184,210 ($189,873 in 2013) per worker and the average total direct spending was $157,148 ($155,877 in 2013) per worker.

Total (direct + indirect) average spending per worker increased by 3.07% from 1st Quarter 2012 to 1st Quarter 2013.

However, factoring out the indirect sector we find that total (direct) average spending per worker DECREASED by 0.80% from the same time period.

Seems like a vote of confidence if employers directly serving tourism are willing to hire more workers at a lower customer spending per worker threshold.  However, the flip side is in the indirect support supply side they seem less willing to hire as increased spending per worker flows to them.

Any other thoughts??
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