Insight – A report card on the Australian tourism industry in 2020–21

29 September 2021

Australia’s tourism industry has grappled with the impacts of COVID-19 for more than 18 months.

Austrade's Tourism Research Australia (TRA) has released its latest data on the tourism industry. The data gives insights into how the industry responded to these challenges during 2020–21.

These are the 5 features that defined tourism in 2020–21.

Our industry depended on Australians seeing Australia

During 2020–21, 99% of all spend came from domestic tourism. The industry benefitted from our love of travel and high levels of pent-up demand. The downside is that accommodation providers and operators with high international exposure remained vulnerable.

The year started with a tentative recovery

Australia lifted national lockdowns in May 2020. The industry still endured local outbreaks, travel restrictions and capacity constraints. Spending was down 53% in the second half of 2020 compared with the second half of 2019.

Demand picked up in the second half

Travel restrictions eased and consumer confidence lifted in the second half of 2020–21. Businesses took advantage of high pent-up demand. Spending went up 45% on the first half of 2020-21. Most notable was the strong return of interstate travel – which increased 215%. Meanwhile, intrastate demand was just 3% short of pre-pandemic levels.

Regional tourism led the way

Australians are mostly city dwellers. Many of us sought respite in the regions when restrictions eased. In 2020–21, 68 cents of every visitor dollar was spent outside capital cities. This compares with just 48 cents in 2019.

Business managed to hold on

While visitor spend was 41% lower than in 2019, the effect on employment was more subdued. Average employment in 2020-21 was down just 10% on 2019. This reflected businesses’ ability to keep workers by using JobKeeper support and reducing hours. The extension of creditor laws and economy-wide and sector-specific support also helped tourism businesses.

Performance of Australia’s tourism industry in 2020–21

Australia’s tourism industry was valued at $81 billion in 2020–21. This was 41% down on 2019.

Capital city performance

Capital city spend was $26 billion in 2020–21. This was 64% down on 2019. Capital city spend accounted for 32% of total spend.

Figure 1: Capital city performance (2020–21)

Figure_1_capital_city_performance

Regional performance

Regional spend was $55 billion in 2020–21. This was 17% down on 2019. Regional city spend accounted for 68% of total spend.

Figure 2: Regional performance (2020–21)

Figure_2_Regional_performance

Delta variant hits the tourism sector

The Delta-variant of COVID-19 has hit the tourism sector hard. Australia’s two largest cities and its national capital are in lockdown as at September 2021. Australia and New Zealand had to suspend the trans-Tasman travel bubble. Organisers had to cancel or move major events. Australians are also less confident about booking travel in advance.

There is no official data beyond June 2021 at this time. It is inevitable, however, that these factors will weigh heavily on demand.

A bright outlook

There are some positive signs. Vaccination rates are rapidly approaching the levels needed to open up our economy. Restrictions are slowly easing. Qantas is accepting bookings to Canada, the UK and Singapore. 

Tourism Research Australia expects demand and traveller confidence will soon return. But it depends on increased travel certainty and people taking care to stay COVID-19 safe.

Visit www.tra.gov.au for the latest data on Australia’s tourism sector.