TO THE POINT: An opportunity to save Newfoundland & Labrador tourism

There is little doubt that tourism is one of the sectors hardest hit by the pandemic. The question is how hard and what can be done to mitigate the damage this season.

 

Let’s start with a quick look at the industry’s main components—accommodations (mostly driven by non-resident visitors), food and beverage services (mostly driven by residents) and travel services, transportation as well as recreational and entertainment.  

Tourism was credited with generating more than $1.5 billion of economic activity and about 20,000 full-time equivalent jobs in Newfoundland and Labrador in 2019. But this sector doesn’t relate only to those visiting the province on vacation. This economic activity includes in-province spending by residents as well as expenditures by non-resident visitors. True tourism (that related to vacation travel only) is not really a year round activity in Newfoundland. Most visitors, wisely perhaps, arrive between May and October. 

The rest of the year, visitors to the province are generally here for business or attending conferences, visiting friends and family or making a short trip from other parts of the region for shopping or entertainment. Only about half of non-resident visitors are vacationing. It would be more appropriate to call this sector the Travel and Hospitality Industry. 

Bars and restaurants may be first to bounce back

Here are some critical numbers to think about: half of all tourism revenue in the province comes from bars and restaurants and most of that money is spent by residents.

This is encouraging and suggests that once restaurants and bars are able to open fully, revenues there should recover the quickest. The story is quite different for accommodations which depend much more on out-of-province visitors and where several hotels have temporarily closed in St. John’s. 

The cancellation of cruise visits this year will have a direct impact on most tourist operations and tour operators. The Port of St. John’s was expecting more than 70,000 cruise visitors this season.

 

In 2019, there were more than half a million non-resident visitors to the Newfoundland. They represent more than half the tourism dollars spent in the province. Having the Newfoundland‘s borders closed to other provinces in the region is particularly harmful, as visitors from the region represent more than a quarter of all non-resident visitors to the province.

The closure of the US-Canada border until late June puts at risk visits by the more than 40,000 Americans who came to the province last year. Other international travellers from last year have no access to Newfoundland right now and may not for some time. Those visiting from Ontario and Quebec are unlikely to have access to the province this season.

The most important priority to minimize the damage to the tourism industry in Newfoundland is to open up the market to travel within Atlantic Canada by creating an economic regional bubble. With the low incidence of active COVID-19 cases within the region, we should focus on the 2.4 million potential visitors in Atlantic Canada as a way to mitigate the damage to the tourism industry across the region. This strategy would include providing early access to those owning recreation property in other provinces in the region. 

The four Atlantic Provinces enjoy an unusually close economic and cultural relationship, perhaps unique in the country.  Creating an Atlantic economic zone until travel from outside the region is safe is in the best interests of all four provinces, not only for tourism, but business in general. Clearly, the Atlantic Provinces should be talking now and developing a plan to open up the region for travel by establishing clear criteria to do so safely.  Promoting staycations will not be enough to minimize the negative impact on tourism within any given province.

This is especially true for accommodations or specific activities targeting out-of-province visitors like meetings and conventions or golf excursions.

 

Each province should revise its marketing plan to focus on the regional market, with a common theme to encourage travel across the region. Special incentive packages could be developed by each. A buy Atlantic Canadian strategy for vacation travel could be considered as a joint undertaking by the four provinces. Encouragingly, the four provincial tourism industry associations are about to offer a joint program under the theme, Tourism Strong Atlantic.

Given that most large events, like festivals and concerts will not take place, the emphasis of any regional marketing must be on individual experiences and activities. There really isn’t a better place to vacation during the summer and fall than in Atlantic Canada after all. I am already planning trips to both New Brunswick and PEI once allowed to do so. How about you?