THE IMPORTANCE OF THE HOSPITALITY TOURISM AND EVENTS INDUSTRIES TO THE AUSTRALIAN ECONOMY SINCE THE 21ST CENTURY

Student Name: Sarah Frost Student Number: 00085475T Teachers Name: Trish Powers Due Date: Sunday 25th November 2012

TABLE OF CONTENTS EXECUTIVE SUMMARY ............................................................... PG. 2

INTRODUCTION ............................................................................................ pg. 3 IMPORTANCE OF THE HTE INDUSTRIES ON THE AUSTRALIAN ECONOMYSINCE THE 21ST CENTURY ....................................................... pg. 4 KEY FACTS OF THE INDUSTRY .................................................................. pg. 5 TOURISM ON A STATE SCALE ............................................................ pg. 6 IMPACT OF THE SYDNEY OLYMPIC GAMES ........................................ pg. 8 IMPACT OF THE 2001 WORLD TRADE CENTRE BOMBINGS ................. pg. 8 IMPACT OF THE 2002 BALI BOMBINGS ............................................... pg. 9 GLOBAL FINANCIAL CRISIS .............................................................. pg. 10 HOST/GUEST DYNAMIC ............................................................................ pg. 10 CONCLUSION ............................................................................................. pg. 11

GRAPHS

RETAIL TURNOVERS FOR CAFS, RESTAURANTS & CATERING SERVICES BY THE STATE & TERRITORY ............................................ pg. 7 ESTIMATES OF DIRECT CONTRIBUTION TO AUSTRALIAS TOURISM GROSS ADDED VALUE BY STATE & TERRITORY ................... pg. 7 BUDGET.GOV.AU AUSTRALIAS ECONOMIC GROWTH AMONGST ITS EAST ASIAN COUNTERPARTS ......................................... pg. 9

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Executive Summary
The purpose of this report is to identify the affect and contribution that the Hospitality, Tourism and Events (HTE) Industries have had on the Australian economy since the 21st century. The information collected within the report has been sourced from several online websites, journals and reports. The report begins with a look into the importance of the Hospitality, Tourism and Events Industries on the Australian economy since the 21st century in regards to Australias Gross Direct Profit (GDP), employment and natural disasters affecting the Hospitality, Tourism and Events industries. The report then moves on to key factors of the industry and the stance of the Hospitality, Tourism and Events Industries within Australias states. The report will then move on to specific events that have affected the Hospitality, Tourism and Events Industries such as the Sydney 2000 Olympic Games, the 2001 World Trade Centre Bombings, the 2002 Bali Bombings and the 2008-09 Global Financial Crisis. In the final section the report will discuss the Host/Guest dynamic within the Hospitality, Tourism and Events Industries.

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Introduction
Hospitality, Tourism and Events (HTE) Industries play a major role in Australias economy. This report first explains the important role the Hospitality, Tourism and Events Industries have played on the Australian Economy since the 21 st Century. Secondly the report will discuss the affect that major World events and issues have had on the Australian economy in regards to the Hospitality, Tourism and Events Industries. The report will then include the importance of the Host/Guest concept and Customer Service to show how they impact on the Hospitality, Tourism and Events Industries, and the Australian Economy.

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Importance of the HTE Industries on the Australian economy since the 21st Century
Hospitality, Tourism and Events in Australia is an 81.4 Billion Dollar Industry (201011), which employs 500,000 people directly and just under 400,000 people indirectly, making Hospitality, Tourism and Events hire 7.9% of the Australian population. Tourism contributes 73.3 Billion Dollars to Australian Gross Direct Profit (GDP) and a 5.2 per cent share of the Australian economy, making Tourism the highest trade export (State of the Industry Report, 2011) According to the 2011 state of the industry report, the Australian tourism industry has been coping with many natural disasters in the last 12 months; severe flooding in Brisbane and southern and central Queensland and Cyclone Yasi, these disasters have resulted in a loss of $1.4 billion in total visitor expenditure in Australia and has cost tourism industry stakeholders around $30 billion. According to ret.gov.au, the 2010-2011 Travel score card has shown that tourism expenditure is 3 per cent lower, total holiday travel expenditure is down 9 per cent and business travel expenditure is only $1.7 billion lower than the travel score card of 2009-10. (www.ret.gov.au/tra, 2011) Tourism and hospitality businesses are at the frontline of Australia s economy (www.serviceskills.com.au, 2011) they provide consumers with goods and leisure services both domestically and internationally. The Industry is forever changing due to circumstances and events that happen on a local and international stance.

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Service skills (2002) states that the Hospitality, Tourism and Events (HTE) Industry is made up of accommodation, restaurants, cafes, bars, catering, gaming, meetings, events, conferences, tour operations, tourist information services, tour guiding, holiday parks and resorts, cultural tourism, casinos and caravan park operations. These Industries are crucial for Australias economy; a lthough the Australian tourism industry has had to deal with many natural disasters and shocks to the industry; it is one of Australias strongest industries due to every dollar that the tourism industry brings to the economy a total of $1.91 is added to the Australian economy. (www.ret.gov.au, 2011) Service skills (2002) states that natural disasters and terrorism attacks are not the only circumstances that affect the Hospitality, Tourism and Events Industry, other key factors include; oil prices which can lead to an increase or decrease in airline fuel surcharges, the strength of the Australian Dollar (AUD) and Australias inter est rates.

Key Facts of the Industry

November 2010 the Industry employed 764,000 people, being 6.7% of Australias total workforce. This is an increase of 7.3% since November 2008. At the end of the 2009 financial year 77,087 businesses were operating in Australia within the Hospitality, tourism and Events Industry. This was a decrease of 1.3% from the 2008 financial year. Tourism contributed $33.9 billion to Australias Gross Direct Profit for 2009 -10. Australians made 66.8 million domestic overnight tri ps in 2010, spending 261 million nights away from home. Australians made 6.8 million outbound trips in 2009 -10
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September 2012 Highlights There were 6.0 million visitor arrivals for year ending September 2012, an increase of 3.0 per cent relative to the previous year. There were 4.4 million visitor arrivals to Australia during the nine months to September 2012, an increase of 4.1 per cent relative to the same period of the previous year. There were 473,600 visitor arrivals during September 2012, an increase of 9.6 per cent relative to the same period of the previous year.

Reference- http://www.tourism.australia.com/en-au/research/5236_5241.aspx September 2012

Source: Australian Bureau of Statistics, Overseas Arrivals and Departures, 3401.0. ABS data used with permission from the Australian Bureau of Statistics www.abs.gov.au

Tourism on a state scale

As illustrated on the graph (graph 1) below cafes, restaurants and catering services in New South Wales turned over $5440.4 million in 2010. This is an increase of $434.3 million, or 8.7%, from 2009. Graph 2 shows that New South Wales contributed $11782 million to Australias Gross Direct Profit for 2007 -2008. Queenslands cafes, restaurants and catering services turned over $3335.3 million in 2010, which is an increase of $296.2 million, or 9.7%, from 2009 (Graph 1). Graph 2 shows that Queensland contributed $7463 million to Australias Gross Direct Profit for 2007-2008. Victorias cafes, restaurants and catering services in 2010 turned over $4831.1, million, which is an increase of $361.1 million, or 8.1%, from 2009 (Graph 1). Graph 2 shows that Victoria contributed $7208 million to Australias Gross Direct Profit for 2007-2008. Western Australias cafes, restaurants and catering services recorded $2221.9 million turnover for 2010, this is an increase of $425.2 million, or 23.7%, from 2009 (Graph 1). Graph 2 shows that Western Australia contributed $3102 million to Australias Gross Direct Profit for 2007 -2008. South Australias cafes, restaurants and catering services turned over $1018.9 million in 2010, this is an increase of $27.3 million, or 2.8%, from 2009 (Graph 1). Graph 2 shows that South Australia contributed $1917 million to Australias Gross Direct Profit for 2007-2008. Tasmanias cafes, restaurants and catering services turned over $215.2 million in 2010, this was a decrease of $12.2 million from 2009 (Graph 1). Graph 2 shows that Tasmania contributed $864 million to Australias Gross Direct Profit for 2007 -2008.

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Northern Territorys cafes, restaurants and catering services recorded $202.4 million for 2010; this was an increase of 36.7% from the 2009 turnover of $148.1 million (Graph 1). Graph 2 shows that the Northern Territory contributed $800 million to Australias Gross Direct Profit for 2007 -2008. Australias Capital Territorys cafes, restaurants and catering servic es recorded $215.2 million of turnover in 2010, this was an increase of $900 thousand from 2009 (Graph 1). Graph 2 shows that the Australian Capital Territory contributed $596 million to Australias Gross Direct Profit for 2007 -2008.

Graph 1

Source: Service Skills Australia, 2011

Graph 2

Source: Service Skills Australia, 2011

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Impact of the Sydney Olympic Games

The Sydney 2000 Olympics was the largest and most successful Games ever conducted in the Modern Olympiad. The financial commitment from the NSW Government was 3.5 Billion Dollars. In return for this large outlay, the Sydney Olympic venue would allow visitors to have access to world-class sporting facilities (Kristy Anne Owen, 2001) The Sydney Olympics as of August 1st 2001 had brought in 6 Billion Dollars to the Australian economy through inbound tourist spending. According to the 2011 state of the industry report, the Australian tourism industry has suffered from constant shocks which have had a negative impact on the industry which has lowered the growth in tourist activity and expenditure, compared to the two decades before 2000, since the Sydney 2000 Olympic Games. According to the Australian Bureau of Statistics (2002) during 2000-01 the tourism industry share of Gross Direct Profits was 4.8% with a total of $32 billion; this was influenced by the Sydney 2000 Olympic Games.

Impact of the 2001 World Trade Centre Bombings

According to the Australian Bureau of Statistics (2002) the Gross Direct Profit fell $53 million or 0.2% to that of the statistics in the same period of 2000-01. The international visits dropped, however the Gross Direct Profit grew 6.5%. According to budget.gov.au (2002) Australias economic growth was the strongest, in 2001, amongst its East Asia counterparts. As shown in the graph below (Graph 3), Australias economic growth was forecasted averaging 3 per c ent in 2002-03.

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Graph 3

Source: www.budget.gov.au

Impact of the 2002 Bali Bombings

The Bali bombings that occurred on October 12 th 2002 claimed the lives of 88 Australians. A place that many Australians considered a home away from home (Sobocinska 2012) the reality of the 2002 attack hit very close to home, the revelation that a place nearly an Australian state could fall privy to terrorist attacks terrified frequent travellers. This saw a major decline in travel to Bali from Australian residents, Qantas halved their flights to Bali just ten days after the 2002 bombings. With over 400 Australian businesses operating in Bali and 4000 Australian employees working in Bali the bombings hit home strongly (Henderson, 2002). The Australian Government provided financial support for injured people returning to Australia from Bali, and assistance with funeral and financial costs (www.disasterassist.gov.au) In response to the Bali bombings, airlines switched capacity from Bali to Fiji or Phuket, and in response to a strong Australian Dollar (AUD), they switched capacity from largely inbound destinations to largely outbound destinations. (State of the Industry, 2011).

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Global Financial Crisis After the 2008-09 Global Financial Crisis; Tourisms Gross Direct Profit grew more than 2.5 per cent annually during 2009-10 and 2010-11 after declining 0.3 per cent during 2008-09. (www.ret.gov.au/tra April 2012) According to ret.gov.au, Australias dollar has remained high against other currencies such as the United States of America; this is due to Australias ties with China, Australias high interest rates and a solid economic performance throughout the Global Financial Crisis. (www.ret.gov.au/tra, 2011) According to ret.gov.au (2011) whilst the Australian Dollar stayed strong the aftershocks of the Global Financial Crisis sent tourists into panic mode and consumer confidence weakened, meaning c onsumers werent spending as much as they had previously done on consumer products. Visitation to Australia from citizens of Europe and North America had dropped in relation to the Global Financial Crisis due to their countries weak economic performance

Host/Guest Dynamic
Tourism involves an interaction with people at a particular destination. Different types of tourism mean that there are different forms of interaction between hosts and guests. Some examples of these different types of tourism are; Cultural Tourism - focussing on customs of indigenous people, their rituals, ceremonies, art and home life. This involves intimate contact between hosts and guests.

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Historical Tourism guided tours of historical places to give an education to the guest on their journey. In this type of tourism the host-guest relationship can feel business like and make for a more impersonal relationship.

Environmental Tourism these include visiting remote areas such as mountains or tropical forests. Host-guest contact varies according to whether the tour is guided or not.

Recreational Tourism this includes golf courses, snow ski slopes or natural habitats. This type of tourism is more of a freedom holiday for guests and can cause for a servant/master relationship between the host and guest.

Conclusion
It is clear from the findings that the Hospitality, Tourism and Events Industry play a vital role in the Australian economy. It contributes greatly to the economies Gross Direct Profit and is one of the economies strongest industries. The Australian economy has been shocked by many local and international events such as floods, cyclones, terrorism attacks and a global financial crisis and it still continues to steadily grow through these events and remains one of Australias highest employers. In conclusion, the Australian economy will continue to benefit and grow in a steady pace with the Hospitality, Tourism and Event Industrys staying one of its strongest industrys.

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References
http://www.abc.net.au/pm/stories/s708070.htm (accessed 24 November 2012) http://www.budget.gov.au/2002-03/budget_overview/html/overview-001.html (accessed 24 November 2012) http://www.disasterassist.gov.au/PreviousDisasters/International/Pages/BaliB ombings2005Financialassistanceandpersonalsupport.aspx (accessed 9 November 2012) http://www.egyankosh.ac.in/bitstream/123456789/35796/1/Unit-3.pdf (accessed 25 November 2012) http://eprints.bournemouth.ac.uk/836/1/Hemmington_Output_4.pdf (accessed 24 November 2012) http://www.serviceskills.com.au/sites/default/files/TourismHospitaliyEventsSca n_Print.pdf (accessed 25 November 2012) http://theconversation.edu.au/reclaiming-our-home-away-from-home-the-balibombings-10100 (accessed 9 November 2012)

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