A third of Alberta’s tourism sector could vanish without more aid, group says
Without sustained government aid, one-third of the province’s tourism industry could permanently fold, an industry group said Friday.
With the summer season, which provides up to 70 per cent of the industry’s revenues, in peril due to a halt to international travel, the wheels could come off a big chunk of the sector in the coming year, said Darren Reeder, board adviser with the Tourism Industry Association of Alberta.
“Thirty-three per cent are currently at risk of permanent closure due to the impact of COVID-19,” said Reeder, noting the industry counts 23,000 businesses.
“For those businesses that only operate throughout the summer months, there’s a high likelihood many won’t be able to make it through to the year 2021.”
Though foreign travellers make up only five per cent of visitor volume in Alberta, they account for 24 per cent of sector expenditure, he said.
That’s nearly six times greater per capita than revenue generated by Alberta visitors, said Reeder.
He noted the Canada-u.s. border will remain closed to U.S. visitors until at least July 21, adding there’s little optimism international flights will resume in time to salvage the lucrative summer season.
“It would be a blessing and a certain help if some of the international markets opened but I don’t believe there are any businesses counting on their summer business including the U.S.,” said Reeder.
Hotels that would normally be 65 per cent filled at this time are booked at 25 per cent capacity, he said, while cancellations have cost the lodging sector $330 million.
“It could take two to three years before we recover to PRE-COVID levels and there’s no certainty of that,” said Reeder.
Federal government emergency business and employment income supports have helped but are short term and what’s needed is more stimulus and measures to incentivize domestic travel, such as a $2,000 per household tax credit and the return of GST visitor rebates, he said.
The association is taking its rehabilitation plan to the province’s Economic Recovery Council next week.