IMPACT OF TOURISM3.01 Discuss the economic impact of tourism.
Tourism…•Provides employment for millions ofpeople.•Provides profits for businesses andcorporations such as airlines, amusementparks, and retail shops.•Revives economically depressed areas.•Provides tax revenue for local, state, andnational governments from the use ofservices and facilities.•Serves as the sole source of exportincome in some countries that lack culturaland industrial resources.
Tourism…•Stimulates export of “place made”products such as clothing or souvenirs.•Provides incentive to improveinfrastructure that can be used byresidents and tourists.•Provides incentive for entrepreneurialactivity.
Multiplier effect Tourists spend money when traveling which puts money into the local economy. That money is then spent by local businesses to purchase goods, pay employees, etc. This re- spending expands the local economy, creating the multiplier effect.
Multiplier effect •The more developed the area, the higher the multiplier effect. •Tourism dollars stay in an area and are re-spent rather than go outside the area to purchase goods and services.
LeakageLeakage occurs whentourists’ dollars are used topurchase needed goods orservices from outside thearea.
Leakage•The more imports that are necessary,the higher the leakage will be.•Sometimes a large part of the incomefrom tourism has to be used to pay forimported equipment and materialsused to satisfy the needs of tourists.•When an area has the resources toproduce all the necessary goods andservices, the full amount of touristspending will remain in the area.
Necessary leakageThe cost of promoting adestination abroad; if adestination wants to attracttourists, it must marketitself to convince potentialcustomers that it is moreappealing than otherdestinations.
Impact of Tourism in NC (2002)•$12 billion in revenue•$1.1 billion in state and local tax revenue•Over 44 million visitors•Shopping, visiting beaches, outdoor activities,visiting historical places and museums•Average of 2.2 nights spent•Average household spending per trip $316•Most visit for leisure purposes•Visiting friends and relatives•Travel by car
NC Tourism Employment (2002) •Second largest industry in NC •Sixth most visited state behind CA, FL, TX, PA, NY •Employs over 189,000 North Carolinians •Top employers are food service, public transportation, lodging, and entertainment and recreation