Sydney lockdown delivers $6.3bn hit to national tourism sector over the July winter school holidays

Sydney’s Covid-19 lockdown is set to cost the national tourism sector billions over the winter school holidays.

A near empty Sydney Opera House forecourt over the weekend. Picture: Getty Images

Sydney’s Covid-19 lockdown is set to cost the national tourism sector $6.3 billion over the winter school holidays, and cost the NSW economy $2.1 billion alone in lost visitors.

New modelling from the Transport and Tourism Forum shows the lockdown will lead to domestic tourist numbers across the country plummeting by as much as 73 per cent, with the sector warning the national cabinet must decide if the nation wants a tourism industry at all.

Operators are now only expecting $4.2 billion in revenue and more than 460,000 visitors in the June-July holidays, compared to the pre-pandemic numbers of 1.7 million visitors and $10.5 billion they spent in the same period in 2019.

Transport and Tourism Forum chief executive Margie Osmond said on Sunday the numbers showed that, despite the success of the economic recovery so far, structural issues in tourism must be addressed by PM Scott Morrison and the state premiers.

“There is some hope that Queensland bookings are being filled by Melburnians coming out of lockdown, but Sydney is the biggest city with the biggest number of tourists and the biggest tourism industry,” she told The Australian.

“Our industry is absolutely devastated.

“Gladys Berejiklian has been our saviour throughout the pandemic and she still is, health comes first.

“But we need the national cabinet to sit down with us and discuss support.

“We know JobKeeper couldn’t go on forever, but there needs to be some assistance and some strategy on how to get tourism back on its feet, as we’ve been uniquely harmed by this crisis.

“The national cabinet does need to decide whether it wants a tourism sector at all.”

In NSW, the TTF estimates the nation’s biggest state will lose $153 million a day, and Sydney will lose $61 million a day, in tourist dollars during the two-week lockdown.

NSW usually accounts for 34 per cent of tourist spending during the July holidays and Sydney is expected to account for 40 per cent of the downturn in revenue, with a total loss of $875 million.

Ms Osmond said the winter break was a particularly tough time for Covid-19 restrictions to hit the sector.

“The July holidays is when people want to explore a range of experiences – they want to go skiing or they want to go to the Gold Coast to get away from cold weather,” she said.

“And these outbreaks have a huge effect on confidence, even places that are not locked down.

“We are starting to see questions about the sector’s robustness. We have usually been able to back down but that’s looking more difficult with this outbreak.”

The Sydney lockdown is also predicted to have a significant dent in other sectors.

Australian Retailers Association chief executive Paul Zahra said his industry would lose $2bn in sales over the lockdown period.

“We can’t ignore the fact that (this) announcement is a devastating blow for retailers, in particular small businesses who were already struggling due to the ongoing Covid impacts,” he said on Saturday.

“The restrictions will result in around $2 billion in lost retail trade. While some businesses can still open, with the consumer restrictions in place, there simply won’t be the usual number of people out shopping.

“Without a safety net like JobKeeper and with consumer confidence severely impacted, many small businesses will be pushed to breaking point.”

The tourism and hospitality sectors had advocated for a sector-specific JobKeeper 2.0 in the lead up to the May Budget, but their calls were rejected by Mr Morrison and Josh Frydenberg.

The tourism sector’s pain was further drawn out this weekend when the New Zealand government suspended the trans-Tasman travel bubble for 72 hours in response to the Sydney outbreak.