New research from Qa is underpinning a campaign to save inbound tourism companies as the coronavirus pandemic continues to take its economic toll.
Our latest Business Barometer survey for UKinbound found that many businesses in the sector were facing making redundancies – and a substantial minority did not believe they would make it through the crisis.
But UKinbound says the study proves that viable, export earning, inbound tourism businesses would be saved from collapse, and highly skilled people could avoid redundancy, if the Government provided targeted support.
When the Chancellor announced details of the new Job Support Scheme (JSS) on 24th September, our barometer showed that three in four inbound tourism businesses were planning to start making redundancies.
This figure dropped to under 50% when the more targeted JSS closed option, for businesses required to shut due to local lockdowns, was announced on 9th October.
However, 72% of tour operators and destination management companies will still need to make redundancies.
Tour operators and DMCs have been hardest hit by the pandemic as they are reliant on international visitors for business, can’t pivot to domestic – and were excluded from crucial support channels.
In the Qa survey, 40% of respondents stated that their business will manage through the crisis – but this increased to 62% after the 9th October announcement.
Yet only 37% of tour operators and DMCs stated they would be operational when business returns.
Confidence levels low
Confidence levels continue to be low. Only 17% of respondents say they are confident about business in the next 12 months, but this is a rise on the historic low of 11% recorded in April.
A range of reasons were given for this low confidence including
- the lack of clear policy from Government on travel corridors
- and no decisive move to testing pre-arrival rather than quarantine.
UKinbound says it will continue to lobby Government with the following asks:
- Creation of a ‘Tourism Resilience’ Fund to help businesses wholly reliant on international visitors to survive until the return of the market in Spring 2021
- Call on the Minister of Housing, Communities & Local Government guidance on rate relief and grants should be amended to include tour operators and DMCs
- Testing on arrival/ regional corridors to restore consumer confidence in travelling to the UK
- Extension of the enhanced JSS for lockdown areas totour operators andDMCs who have been prohibited from trading because of HMG impediments (e.g. lockdowns, quarantine etc).
Joss Croft, CEO, UKinbound said that the Qa Research shows that targeted Government support does work, “but the tourism industry is a diverse range of inter-related businesses that depend on each other for survival, and currently the UK’s 200 plus inbound tour operators and DMCs continue to be left out in the cold, struggling to survive.”
Inbound tourism is the UK’s third largest service export earner, with 40 million international visitors visited the UK in 2019, contributing £24 billion to the UK economy.
“We urgently need Government, specifically Treasury and the Minister of Housing, Communities & Local Government, to engage with the sector and provide clear targeted support for these businesses,” Joss said.
“There is a pent-up demand to visit Britain; these businesses must be helped to survive so that they can help play a key role in the UK’s economic recovery. We will be delivering a proposal for targeted support to Treasury soon.”