Difficult times for tourism businesses with job losses on the horizon

Australia’s export tourism industry is staring down the barrel of job losses and business closures, according to the Australian Tourism Export Council (ATEC).

Over the past week ATEC has surveyed its Inbound Tour Operator (ITO) members, particularly those with large China focused businesses, to take a pulse check on their situation.

“We are seeing dramatic contractions in forward bookings across all markets, with China 100 per cent down and apprehension from other Asian markets that are still able to travel,” ATEC managing director Peter Shelley said.

“Many Australian ITOs have not been paid for services provided over the Chinese New Year period as most China based travel wholesalers have had to shut their offices due to the virus. On top of that they are also facing severe financial difficulties as China outbound travel ground to an abrupt halt.

“With businesses closed and no new travel bookings, cashflow has dried up, forcing many in the industry to focus on business survival and retaining their experienced staff so that they are in a position to rebound when the ‘storm’ passes.

“If things don’t improve soon, they are likely to make significant redundancies or possibly close their businesses.”

Shelley said any loss of inbound tourism distributors will have a major impact on the ecosystem of the tourism economy which has been developed over the last 20 years.

“Any erosion of our established tourism distribution channels will greatly hinder Australia’s ability to rebound once COVID-19 passes,” he said.

“The tourism export distribution channel, from the customer in market through to the Australian based product supplier like hotels, tours and attractions, is complex and relationship driven, so a loss of staff and or business failure will have a dramatic impact on our ability to pick up where we left off.

“Given Chinese visitors contributed more than $12 billion to the Australian economy last year, we need to proactively protect the infrastructure of this export tourism distribution channel.

“While these businesses are doing what they can to keep the doors open, we are urging the Government to extend business support and recovery packages including concessional loans, short term wage subsidies and a reduction in taxes and charges to help preserve the ecosystem of our industry, followed by investment in aviation and destination marketing to help drive a recovery into the future.”

With nine in 10 of tourism businesses employing fewer than five people, the Australian Tourism Industry Council has warned that jobs would be lost if more support was not forthcoming.

“Crisis is an overused word, but we have operators who are going to go to the wall,” the council’s chief executive, Simon Westaway, told Guardian Australia.

Westaway has called on the federal government to give immediate tax relief to tourism operators and to give Tourism Australia the ability to focus on the domestic market.