Covid blasts $101bn hole in tourism

Covid-19 has changed Australian travel patterns with most holidaymakers now opting to take regional trips within their own state.

Brisbane Airport remains quiet this month. But regional-holidaymaker spending was up 15 per cent, or $1.5bn, to $11.5bn in 2020-21. Picture: NCA NewsWire/Tertius Pickard

More than $101bn has been lost from the coffers of the local tourism industry since the start of the pandemic, but Covid-19 has also changed Australian travel patterns with most holidaymakers now opting to take regional trips within their own state.

The grim federal government research foreshadows that tourism’s recovery will further deteriorate in the second half of the year, due to Covid outbreaks causing border closures and long-term lockdowns across NSW, Victoria and the ACT, where visitor arrivals have plunged 39 per cent.

Change in interstate visitor spending

Released on Wednesday, the Tourism Research Australia data reveals that overall tourism losses between the start of the pandemic in March last year up until June 30, 2021 totalled $101.7bn.

International travel has fared the worst, losing 94 per cent, or $51.3bn, while domestic overnight trips have proved better performers, falling 36 per cent, or $38.3bn, to $69bn.

But it’s not all bad news, with regional areas faring better than capital cities in the June 2021 quarter, with regional-holidaymaker spending up 15 per cent, or $1.5bn, to $11.5bn, due to people taking longer regional trips and high participation in the government’s $1.2bn half price airfare stimulus program in March.

“As a result of border closures and restrictions, Australians switched to taking longer self-drive trips within their home state,” TRA said.

“In the year ending June 2021, the share of intrastate overnight trips and spend increased across all states and territories. Nationally the share of overnight intrastate trips increased from 68 per cent to 80 per cent for overnight trips and 45 per cent to 65 per cent spend (for the year to June 2021).”

The pandemic has sparked a major increase in regional pub sales valued at up to $10m in country areas, according to pub broker Andrew Jolliffe, managing director of HTL, as city dwellers look for business opportunities in rural areas.

Mr Jolliffe says a definite trend has emerged of experienced pub investors also heading for the regions, with NSW’s New England area in the state’s northwest stretching from Armidale to Moree, as well as the northern district from Grafton to Byron Bay the most popular.

In the 12 weeks since Sydney was locked down on June 26, HTL has sold $360m worth of pubs in 36 deals. Sixteen of these deals, with an average sale price of $6.16m, were negotiated in regional areas.

TRA says the increase in regional spending “highlights the extent to which Australians are currently substituting previous outbound and capital city holidays with longer-length self-drive visits to regional areas”.

The pandemic has also sparked an increase in people booking private home accommodation on the NSW North Coast, South Coast and Hunter region, as well as Victoria’s Great Ocean Road. In Queensland, demand for this type of accommodation centred on the Gold Coast and Sunshine Coast.

Capital city travel has not done as well. “Overnight trips to capital cities fell 28 per cent … and (holidaymakers) spent a lesser 16 per cent, or $1.5bn, to $8bn,” TRA said.

Business travel has been the most affected, with overnight trips falling 47 per cent and spend reduced by 53 per cent, or $12.8bn, since the pandemic’s start.

“For the year ending June 2021 … business has struggled most to recover with trips down 42 per cent to 15 million and spend (down) 48 per cent to $9.3bn,” TRA said.

“Holiday travel was the least affected, with much of the impact concentrated in April and May 2020, at the start of the pandemic.”

In terms of overnight visitors and spending, some of the worst collapses have been seen in the ACT, with a 39 per cent drop in visitors and 41 per cent drop in spending between March 2020 and June 2021.

States to perform badly include Victoria losing half its visitors and spending plummeting 55 per cent. In Queensland, there was a 30 per cent drop in overnight visitors.

Originally published as Covid blasts $101bn hole in tourism