In 2021, the travel sector is recovering but at a slower rate than expected. According to the World Travel & Tourism Council (WTTC), which represents the global private sector of travel and tourism, this situation is driven by a lack of international coordination, severe travel restrictions and slower vaccination rates in some parts of the world, which still hinder many regions worldwide. For the international body, all this could cause the annual contribution to global GDP to increase by less than a third.
The economic modelling was conducted by Oxford Economics on behalf of WTTC and calculated a baseline scenario based on the current global vaccination rollout, consumer confidence and relaxed travel restrictions in some regions around the world.
The contribution to the global economy
According to data published by WTTC, the travel and tourism sector generated nearly $ 9.2 trillion for the global economy in 2019. In 2020, the pandemic caused a major setback, resulting in a decline of 49.1 percent, representing a loss of nearly US $ 4.5 trillion. In 2021, the annual contribution that will arrive, for the global economy, will be 30.7% on an annual basis (only 1.4 trillion dollars) and will be mainly driven by domestic spending. The research shows that, based on the current recovery rate, in 2022 the contribution will be similar, or 31.7 percent.
“Our research clearly shows that while the global Travel & Tourism sector is beginning to recover from the ravages of COVID-19, there are still too many restrictions in place, an uneven vaccine rollout, resulting in a slower than expected recovery of just under a third this year,” explains Julia Simpson, President and CEO of WTTC.
Last year, the WTTC revealed that 62 million global jobs have been lost in the travel and tourism industry worldwide. With the current pace of recovery, there should be a 0.7 percent increase this year. Likewise, research shows a more promising potential year-over-year increase in jobs, with 2022 expected to mark an 18 percent increase.
New rules are needed for the recovery
According to the research, the sector’s contribution to global GDP and job growth could be more positive this year and next if certain measures are followed. For example, allowing fully vaccinated travelers to move freely, regardless of their origin or eventual destination, and implementing digital solutions that allow them to easily prove their Covid status, thus accelerating the process at borders around the world. In addition, all vaccines authorized by the World Health Organization (WHO) and/or any Stringent Regulatory Authorities (SRA) should be recognized, and an agreement should be made by all competent authorities to demonstrate that international travel they are safe, thanks to improved health and safety protocols.
If these important rules are followed in 2021, the impact on the global economy and jobs could be significant. According to the data, the contribution of the sector to the global economy could increase by 37.5%, reaching 6.4 trillion dollars (4.7 trillion dollars in 2020). Furthermore, if the restrictions continue to be lifted and there is greater international cooperation, governments could recover nearly 19 million jobs (+ 6.8%) before the end of the year.
In 2022, the contribution of the sector to the global economy could see an annual increase of 34 percent, reaching 8.6 trillion dollars, a result close to 2019, a record year. Likewise, jobs could surpass 2019 levels, up 20.1% year-on-year (over $ 349 million).
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