Staycations and foreign visitors give Brexit boost
Tourism booms as weak pound encourages Britons to holiday in UK and brings in travellers from overseas
THE UK’S tourism sector has been given a Brexit boost as more Britons are opting to holiday at home and a burgeoning number of overseas travellers are courted by the weaker pound.
Three quarters of British adults have been on or are planning a UK holiday, according to a survey of 2,000 people by Barclays. This number is up five percentage points from 70pc when the survey was conducted last year.
The boom is helping small and medium-sized accommodation and food businesses, with average sales rising by 8.3pc in the first six months of the year.
The data showed that Britons were spending less when on their holidays in the UK – down from an average of £613 in 2016 to £530 this year – but this hole has been more than plugged by tourists from abroad travelling to the UK to take advantage of the lower value of the pound. Sterling has fallen by 14pc against the dollar to 1.28 since the Brexit vote while it has dropped nearly 17pc to 1.08 against the euro.
While this has been unhelpful for UK travellers considering overseas trips, it has meant the average budget for foreign tourists has risen to £3,443, with visitors from Asia spending the most. On average, Chinese visitors to the UK have spent more than £5,000 on their holidays. In June alone, international tourists spent a total of £2.2bn – up 2pc on the same month last year.
The figures will come as a relief to tourism-related businesses in the UK as concerns mount about how resilient the disposable incomes of domestic consumers are. With inflation rising – largely because of higher import costs due to the weaker pound – UK consumers are having to spend more for many of their day-to-day goods, which has reduced the amount left over to spend on leisure activities.
But this spending squeeze may have helped fuel the rise in domestic breaks. A fifth of domestic tourists surveyed by Barclays said they had chosen to holiday in the UK to keep costs down and nearly one in 10 were influenced by fall in the value of the pound, which has meant holidaymakers get less foreign currency when converting their holiday money.
The positive numbers come as accommodation and food-related businesses such as restaurants have faced a barrage of rising costs. Changes to business rates have particularly hit those with physical stores and the rise in the National Living Wage has created another burden – even before other factors such as inflation and the Apprenticeship Levy are factored in.
The data also points to the ability of the tourism sector to bounce back from the hit it took in the immediate aftermath of the terrorist attacks in London and Manchester.
There are also fears for the sector surrounding Brexit, including whether it will be made harder for European travellers to visit the UK and whether EU workers will be able to find and keep jobs here. EU migrant workers in the hospitality sector number roughly 700,000 people.
The importance of these and other EU workers has been emphasised by the British Chambers of Commerce, which, alongside its German counterpart the Association of German Chambers of Commerce, has urged Brexit negotiators to deliver “clarity and certainty for trading businesses across Europe” – including on the issue of EU workers’ rights – as the third round of Brexit negotiations gets under way this week.