Taking Tourism Seriously For Future Economic Development

Transcription

1 Taking Tourism Seriously For Future Economic Development The Irish Economy Conference: Learning from Crisis 25 th February 2015 Institute of Banking Professor Jim Deegan University of Limerick

2 Presentation Outline 1. Brief introductory remarks 2. Some data on international tourism & comment on current & projected driving forces: technology is now a key driver 3. Performance of Irish Tourism 4. Tourism in Irish Policymaking 5. Conclusion

3 Some General Factors to Understand Tourism is significantly affected by innovations in other sectors Creative industries being linked with tourism is becoming ever more important across the world The impact of artificial intelligence will impact on the tourism labour market but just how?

4 PERFORMANCE OF IRISH TOURISM Tourism Proves Yet Again A Good Bellwether For The Overall Economy

5 THE QUARTERLY NATIONAL HOUSEHOLD SURVEY Person aged 15 years and over in Employment (Thousand) by Sex, NACE Rev 2 Economic Sector and Quarter 2008Q3 2011Q1 2012Q4 2014Q3 All NACE Economic Sectors 2, , , ,926.9 Agriculture, forestry and fishing (A) Accommodation & food service activities (I)

6 World Tourism Arrivals (Millions): 1950 to 1995 and Forecast to 2020 Forecast Made in , , *Actual Arrivals in 2010 Were 940 million

7 1980 Tourist Arrivals Market Share Arrivals to Europe: 1980=180m 2012=520m 2030=720m(f)

8 2030 Predictions Number of International Tourists (mn) Actual 2014 arrivals 1.14billion Central prediction for ,800 ( 74%) Prediction for 2030 with slower economic growth Prediction for 2030 with higher costs of transport Prediction for 2030 with lower costs of transport 1,400 ( 35%) 1,660 ( 60%) 2,000 ( 93%) Emerging Markets Will Play a Key Role In Tourism Across The World adapted from UNWTO

9 Tourist numbers (000's) Total Overseas Visitors to Ireland 9,000 Total Overseas Visitors to Ireland (000's) 8,000 7,000 6,000 5,000 4,000 No. of Visitors 3,000 2,000 1, *

10 REVENUE (MILLIONS) Total Overseas Nominal/Real Revenue (1986 = Base Year) 4, , , , , , ,500.0 Nominal Real 1, YEAR

11 Annual Percentage (%) Change in Overseas Visitors Total Change

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14 Visitor Numbers (ooo's) Main Purpose of Visit: Britain 2,000 1,800 1,600 1,400 1,200 1, Holiday VFR Business Other Year

15 Comments on Economic Impact Poor representation of tourism in the national accounts left void to be filled by numerous Panglossian economic impact assessments - often by hired guns. From 1990s more conservative/realistic estimates produced by Tansey in particular. Nonetheless, the unusual nature of the statistical make up arrested serious engagement by officials in Department of Finance - political expediency rather than strong argument led to funding of the sector. Tourism Satellite Account - TSA( Deegan et al) pilot gave an employment estimate that was far less than that being quoted by DAST at the time-what was overlooked was the insights on what tourism accounted for in related industries. Failure to adopt standard UN recommended methodology of a Tourism Satellite Account in Ireland is a significant failing.

16 Delaney & McFeally 2015 Innovative Use of Business Registers Tourism industries accounted for 197,000 persons employed - 12% of all enterprises in Ireland and 11% of all employment Affected by the downturn since 2007 but more resilient than other sectors The regions of the North West, West and South West most dependent on tourism for economic activity A negative pay gap of 35% in tourism compared to other sectors but most likely overestimated because of nature and structure of tourism employment Tourism employs more females, young people and immigrants than other sectors of the economy

17 Innovation and Performance in Irish Tourism: An Agenda For Action Deegan (Forthcoming 2015) Between /12 it was found that 53% of tourism firms introduced one of the 4 measured elements defined as innovation-product, Process, Marketing or Organisational Innovation(s) 47% of firms open declare no innovation over the period Study finds very different rates of innovation by sub sector of tourism for the main areas measured in tourism innovation studies The barriers to innovation similar to Irish industry in general and some particular problems The ecosystem to stimulate tourism innovation is weak

18 Type of Innovation Introduced By Tourism Enterprises 2008 to 2012 Category of Innovation (n=395) n % Product Process Organisational Marketing Any Innovation

19 Detailed Innovation Activity Rates By Enterprise Sector, Sector Product Process Organisational Marketing All enterprises Hotel/Guesthouse B&B Self-Catered Restaurant/Licensed Trade Tourist Attraction Transport Company* Festival Management ITO/DMC/PCO Total

20 Detailed Type of Innovation Activity By Company Size, Type of Activity Micro <9 (n=282) Small (10-49) (n=74) Medium (50-250) (n=39) All enterprises (n=395) Product Process Organisational Marketing Any Innovation

21 Type of Organisational Innovation Introduced By Number Of Persons Engaged 2008 to 2011 Organisational Innovations: Number of persons engaged < All enterprises New Business practices New Knowledge systems integration New methods of organising external relations Any Organisational Innovation

22 Type Of Cooperation Partner By Size Of Enterprise, Other enterprises within tourism sector Number of Persons Engaged < Total Suppliers of equipment Consultants Clients or Customers Competitors Universities/Colleges Government Failte Ireland Tourism Ireland Any Co-Operation

23 Tourism Does Not Feature In Any Serious Way In National Policymaking For Innovation In IRELAND Do You Need Proof?

24 Government Policy: Action Plan For Jobs 14 Areas Identified By Research Prioritisation Report of November 2011 The 14 priority areas are listed below and form the vital components on which Ireland s future prosperity is being staked. Research/Competence Centres are established and funded following this broad architecture. Priority Area A - Future Networks & Communications Priority Area B - Data Analytics, Management, Security & Privacy Priority Area C - Digital Platforms, Content & Applications Priority Area D - Connected Health and Independent Living Priority Area E - Medical Devices Priority Area F Diagnostics Priority Area G - Therapeutics: Synthesis, Formulation, Processing and Drug Delivery Priority Area H - Food for Health Priority Area I - Sustainable Food Production and Processing Priority Area J Marine Renewable Energy Priority Area K - Smart Grids & Smart Cities Priority Area L - Manufacturing Competitiveness Priority Area M - Processing Technologies and Novel Materials Priority Area N-Innovation in Services and Business Processes

25 OVERSEAS REVENUE AND VISITOR NUMBER TARGETS FROM TOURISM POLICY REVIEW GROUP 2003 COMPARED WITH ACTUAL OUTCOMES Rev m 2002 Prices 2002 Actual 2006 Target 2006 Actual 2012 Target 2012 Actual Overseas Visitor Spend No Visitors (m) Britain M.Europe N.America Other Areas Total

26 Draft National Tourism Policy Paper of July 2014 TARGET IS FOR 5bn in Real Terms From Overseas Tourism by 2025 Hard not to conclude the confidence policymakers have for tourism to contribute to national development has been arrested since This target seems to lack real ambition for the sector.

27 : A more in depth understanding of what the sector contributes (Building a Tourism Satellite Account) Building on Ireland s advantages to link tourism and Creative Industries (OECD,2014) Recognising that ICT and tourism are more entwined than ever and we need to study what opportunities and challenges this will engender-airbnb -UBer Recognising that tourism is more likely than other sectors to maintain and grow employment as artificial intelligence expands its reach Dedicate resources to research the future of tourism for Ireland----

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29 MAYBE SOMETHING RADICAL LIKE THIS!

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31 THANK YOU FOR YOUR ATTENTION