CONTENT/TEACHING OUTLINE
Unit C: Impact of Tourism
COMPETENCY: 3.00 Summarize the impact of tourism.
OBJECTIVE: 3.01 Discuss the economic impact of tourism.
A. Examine the economic impact of tourism.
1. Provides employment for millions of people
2. Provides profits for businesses and corporations such as airlines, amusement parks, and retail shops
3. Revives economically depressed areas
4. Provides tax revenue for local, state, and national governments from the use of services and facilities. Examples: occupancy taxes, gasoline taxes, and user fees for campgrounds
5. Serves as the sole source of income in some countries that lack cultural and industrial resources. Example: islands in the South Pacific such as Bora Bora
6. Stimulates export of locally made products such as clothing or souvenirs
7. Provides incentive to improve infrastructure: The basic foundations such as sufficient power supply, water supply, roads, public utilities, and sewage disposal needed to support and accommodate tourists.
8. Provides incentive for entrepreneurial activity. Small business opportunities might include bed & breakfast homes, guide services, retail stores, and restaurants.
B. Describe the multiplier effect and leakage as economic impacts.
1. When tourists spend money to travel, stay in a hotel, and eat in restaurants, they put money into that destination’s economy. That money is then recycled by those local businesses to purchase goods, pay employees, etc. This re-spending, which expands the economy, is the multiplier effect.
2. Leakage occurs when income from tourism in an area is used to purchase needed goods or services from outside the area.
a. The more imports that are necessary, the higher the leakage will be.
b. Sometimes a large part of the income from tourism has to be used to pay for imported equipment and materials used to satisfy the needs of tourists. For example, if a country has a small domestic automobile industry, it may have to import cars or buses to satisfy transportation needs of tourists.
3. The more developed the area, the higher the multiplier effect. This means that tourism dollars will stay in an area and be re-spent, rather than those dollars being spent outside the area to purchase needed good and services.
4. When an area has the resources to produce all the necessary goods and services required for tourism, the full amount of tourist spending will remain in the area.
5. Necessary leakage refers to the cost of promoting a destination abroad. If a destination wants to attract tourists, it must market itself to convince potential customers that it is more appealing than other destinations.
C. Examine the impact of tourism in North Carolina (based on 2002 figures).
1. $12 billion in revenue
2. $1.1 billion in state and local tax revenue
3. Over 44 million visitors come to North Carolina each year.
4. Top tourist activities in North Carolina include shopping, visiting beaches, participating in outdoor activities, and visiting historical places and museums.
5. Visitors to North Carolina average spending 2.2 nights in our state.
6. The average household spending per trip in North Carolina is $316.
7. More people visit North Carolina for leisure-trip purposes than for business-trip purposes.
8. The most common trip purpose is visiting friends and relatives.
9. North Carolina visitors predominately travel by car.
D. Indicate the employment information related to tourism in North Carolina (based on 2002 figures).
1. Importance of tourism to North Carolina’s economy
a. Tourism is the second largest industry in North Carolina. Agriculture is the largest.
b. North Carolina is the sixth most visited state in the country behind California, Florida, Texas, Pennsylvania, and New York.
2. Total number of jobs provided by tourism-related businesses in North Carolina
a. Approximately 189,300 North Carolinians are employed in tourism- related businesses.
b. The top four tourism-related employers include foodservice (79,100 employees), public transportation (30,500 employees), lodging (29,200 employees) and entertainment & recreation (28,300 employees).
Travel, Tourism, and Recreation Marketing
C-1