A forgotten Cinderella

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The Independent Online
Anyone who drove up the M6 yesterday, or fought their way through the 150,000 people scheduled to pass through Heathrow, will hardly need to be told that tourism is big business. But they might be surprised to learn that travel and tourism together are the biggest business. According to a report* by the World Travel and Tourism Council, it employs more people, has a larger gross output, invests more capital and pays more tax than any other industry in the world.

The WTTC reckons that in 1990 there were 127 million people employed in travel and tourism around the world - one in every 15 employees. This has been growing faster than employment in general, so by now the total should be more than 140 million. In the EC, the proportion is higher: one in every 10 employees.

In terms of contribution to world output, tourism is also edging up: from 5.9 per cent of world GNP to an estimated 6.1 per cent this year. In investment, the survey gives a figure of dollars 276bn for 1990, which would be 6.7 per cent of the world's capital investment that year. Or take taxation: here the figure is 5.6 per cent of all tax revenues, while for some regions heavily dependent on tourism, the share is sharply higher - more than 22 per cent of revenues in the Caribbean.

Yet if people are asked to rank industries in terms of their economic importance, tourism comes quite low. This offhand attitude is reflected in this country's approach to the trade. We earn more foreign currency from tourism than we do from oil but it is treated as a Cinderella. The chairman of the British Tourist Authority and the English Tourist Board, the former journalist William Davis, ended his term of office a week ago. He believes that public policy on tourism is in a mess: 'I felt,' he wrote last weekend, 'that I had been given a walk-on part in a long-running Whitehall farce.' His criticism was directed as much at the way the public sector in general operated, as at the mishandling of the tourist industry.

The structure for helping the industry is extremely fragmented. There is, for example, a new body designed to boost the capital's image: London Forum. It will have two subsidiaries, London Visitors, to boost the tourist trade, and London Inward, to try to increase inward investment. But there is already a London Tourist Board, headed by the same person, Sir Hugh Bidwell, who will run London Visitors, which raises the question, why is another body needed? Meanwhile, last year the English Tourist Board's grant was cut by 40 per cent.

This matters because the industry is fragmented - travel operators, airlines, B and Bs, British Rail, restaurants and hotels, customs and immigration staff at the ports and airports, and so on. When the City was worrying about its competitiveness and sought to find out what irked foreign bankers most about Britain, the queues at Heathrow were high up the list. Yet it was hard to make the civil servants who ran the planning of the airport customs and immigration systems see that they were a part of the travel and tourist industry and were damaging another service industry, finance.

Part of the industry's problem worldwide is that it does not conform to the normal concept of what an industry is supposed to be. All service industries suffer as the 'products' they sell are invisible, but tourism further suffers because its products are less essential than, say, health care.

Maybe - and this is a particular British problem - the tourist industry is undervalued because it has grown relatively recently. Most British people still think of future job opportunities being in manufacturing. But they are much more likely to come in services, and in particular in travel and tourism. (It is not something that the industry stresses, but tourism can mop up relatively unskilled labour.)

So what should be done? The world industry generates such enormous employment and tax revenues that it should gradually carve out a larger place for itself in public policy-making.

As far as Britain is concerned, what is needed is an appreciation that we do have a comparative advantage. We have a net deficit on tourism because Brits like to race off to the sun, but in terms of international arrivals, we were number six among the OECD countries in 1989. We had 3.77 per cent of the world market then. It should not be impossible to push that up, particularly with devaluation last year. But first, we have to convince ourselves that it matters.

*Travel and Tourism - The World's Largest Industry, World Travel and Tourism Council, London, Brussels and New York

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