The global travel and tourism sector suffered a loss of almost US$4.5 trillion in 2020 due to the impact of Covid-19, revealed WTTC research.
The tourism body’s annual Economic Impact Report (EIR) showed the sector’s contribution to GDP dropped a staggering 49.1 per cent. In comparison, the overall global economy dropped by just 3.7 per cent last year.
Vast losses run up during 2020 paint the first full picture of a sector struggling to survive in the face of crippling travel restrictions and quarantines, which continue to threaten the recovery of the world economy.
Altogether, the sector’s contribution to global GDP plummeted to US$4.7 trillion in 2020 (5.5 per cent of the global economy), from nearly US$9.2 trillion the previous year (10.4 per cent).
In 2019, when global travel and tourism was thriving and generating one in four of all new jobs around the world, the sector contributed 10.6 per cent (334 million) jobs globally.
However last year, as the pandemic ripped through the heart of travel and tourism, more than 62 million jobs were lost, representing a drop of 18.5 per cent, leaving just 272 million employed across the industry globally.
These jobs losses were felt across the entire ecosystem of travel and tourism, with SMEs, which make up 80 per cent of all businesses in the sector, particularly affected. Furthermore, as one of the world’s most diverse sectors, the impact on women, youth and minorities was significant.
However, the threat persists as many of these jobs are currently supported by government retention schemes and reduced hours, which without a full recovery of travel and tourism could be lost, said WTTC.
The global tourism body fears governments cannot continue to prop up threatened jobs indefinitely and must instead turn to the sector to help its recovery, so it can power the global economic revival by saving businesses and creating much needed new jobs and saving the millions of livelihoods that depend on the sector.
The report also revealed a shocking loss in international travel spending, which was down 69.4 per cent on the previous year. Domestic travel spending fell by 45 per cent, a lower decline due to some internal travel in a number of countries.
Gloria Guevara, WTTC president & CEO, said: “With the sector’s contribution to GDP plunging by almost half, it’s more important than ever that travel and tourism is given the support needed so it can help power the economic recovery, which will be instrumental in enabling the world to revive from the effects of the pandemic.”
While 2020 and the winter of 2021 have been ruinous for travel and tourism, with millions around the world in lockdown, WTTC research showed that if international mobility and travel is resumed by June this year, it will significantly boost global and country level GDPs – and jobs.
According to the research, the sector’s contribution to global GDP could rise sharply this year, up 48.5 per cent year-on-year. The research also showed that its contribution could almost reach the same levels of 2019 in 2022, with a further year-on-year rise of 25.3 per cent.
WTTC also predicted that if the global vaccine rollout continues at pace, and travel restrictions are relaxed just before the busy summer season, the 62 million jobs lost in 2020 could return by 2022.