8634.0 - Tourism Indicators, Australia, Dec 2001  
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This article was published in Tourism Indicators, Australia, December 2001 (ABS Cat. No. 8634.0).

INTRODUCTION

Tourism is an integral force in the Australian economy, underpinning a wide range of industries and accounting for more than $70 billion worth of goods and services consumed in 2000-01. Tourism contributed 6.0% to total employment, with about 551,000 people in tourism generated employment in 2000-01.

Tourism's contribution to the economy remained strong with a 4.3% share of total industry gross value added (defined below). While tourism's share of GDP increased by 0.3 percentage points to reach 4.7% in 2000-01, this was partly due to price increases in tourism services resulting from the introduction of the Goods and Services Tax (GST) on 1 July 2000. The international visitors share of Tourism GDP rose by 1.7 percentage points to reach 24.0% in 2000-01, reflecting the impact of the Sydney Olympic and Paralympic Games.

This article presents the main results from the recent update to the Australian Tourism Satellite Account (TSA), published on 9 April 2002 in Australian National Accounts: Tourism Satellite Account 2000-01 (Cat. no. 5249.0). Changes in the magnitude of tourism activity since 1997-98, the earliest year covered in the Australian TSA, are also outlined. It is expected that the September 11 terrorist attacks and the demise of Ansett will impact significantly on the 2001-02 figures in the next TSA, expected to be published in April 2003.


WHAT IS THE TSA?

The Australian TSA provides a comprehensive set of economic data on the direct contribution of tourism to the Australian economy within the national accounting framework and a basis from which to compare the performance of tourism with other industries. The indirect effects of tourism consumption are measured in Research Paper No. 6: Tourism's Indirect Economic Effects 1997-98 (Bureau of Tourism Research 2001).

The TSA is compiled using a combination of visitors expenditure data from surveys conducted by the Bureau of Tourism Research, industry data from ABS collections, and supply-use relationships in the Australian system of national accounts supply and use tables. For more information, see the Appendix to this article: 'Key definitions used in the TSA'. This information will help ensure a consistent understanding of the key results.


KEY RESULTS OF THE 2000-01 TSA

Tourism GDP

Tourism GDP is the total market value of Australian produced goods and services consumed by visitors after deducting the cost of goods and services used up in the process of production.

Tourism accounted for $31.8 billion of total GDP in 2000-01, up from $25.2 billion in 1997-98. Tourism GDP was $26.6 billion in 1998-99, and $27.9 billion in 1999-00. Tourism GDP grew 14.2% in 2000-01, substantially up from the relatively steady growth during the preceding two financial years of 5.7% and 4.7% respectively.

The introduction of the Goods and Services Tax (GST) on 1 July 2000 was a significant contributor to the high growth in Tourism GDP in 2000-01. Net taxes on tourism products grew from $3.1 billion in 1999-00 to $5.5 billion in 2000-01, increasing the relative share of Net taxes on tourism products as a component of Tourism GDP from 10.9% to 17.4% respectively.

The tourism industry share of GDP was 4.7% in 2000-01 (graph F1.1). This is significantly higher than the 4.5% recorded in 1997-98 and 1998-99, and the 4.4% recorded for 1999-2000. The increase in the tourism share of GDP in 2000-01 is largely due to price increases in tourism services resulting from the introduction of the GST in that year. Given that services comprise more than half of tourism consumption, and product taxes were levied on a substantial component of tourism for the first time in 2000-01, taxes paid by visitors grew at a faster rate than the overall product taxes collected for the whole economy.

F1.1. TOURISM'S SHARE OF THE AUSTRALIAN ECONOMY 2000-01



Tourism Industry Gross Value Added

Tourism gross value added measures the value of tourism gross output at basic prices (i.e. excluding product taxes such as the GST) by all industries which supply tourism products, less the value of the inputs used in producing these tourism products. It is the preferred national accounts measure of the production of industries because it is free from distortions in prices caused by changes in tax rates or the introduction of new taxes over time.

Tourism gross value added grew from $22.4 billion in 1997-98 to $26.3 billion in 2000-01. Growth in tourism gross value added in 2000-01 was 5.9%, the same rate as for the economy as a whole (graph F1.2). Tourism gross value added grew by 5.7% in 1998-99 and 4.9% in 1999-2000, reaching $23.7 billion and $24.8 billion respectively.

F1.2 GROWTH IN INDUSTRY GROSS VALUE ADDED, Current prices


Tourism's share of total industry gross value added was 4.3% in 2000-01 (graph F1.1), with the same share recorded in 1999-2000 and 1997-98. However, the tourism share of gross value added reached 4.4% in 1998-99.

Comparison with 'non-tourism' industries

Tourism contributed $26.3 billion to total industry gross value added ($611.9 billion) in 2000-01. When compared with the traditional industry groupings (Australian and New Zealand Standard Industrial Classification divisions) published in ABS statistics, the gross value added of tourism ranks twelfth, exceeding that of the following industry divisions:
  • Government administration and defence;
  • Agriculture, forestry and fishing;
  • Communication services;
  • Electricity, gas and water supply;
  • Accommodation, cafes and restaurants;
  • Personal and other services; and
  • Cultural and recreational services.

Tourism consumption

Tourism consumption increased from $58.2 billion to $71.2 billion between 1997-98 and 2000-01. Domestic households consumed $45.9 billion worth of goods and services in 2000-01, while domestic business/government spent $8.2 billion, and international visitors spent $17.1 billion. The international visitor share of total tourism consumption was 24% in 2000-01, up 2 percentage points from 1997-98.

International trade in tourism and tourism employed persons

Tourism also contributes significantly to Australia's exports and to total employment (graph F1.1). In 2000-01, tourism contributed 11.2% of total exports of goods and services. The tourism share of total employment was 6.0%.


DETAILED RESULTS

Tourism industry gross value added

In 2000-01, the industries which accounted for the largest shares of tourism industry gross value added were: Air and water transport (14.9%), Accommodation (10.5%), Cafes, restaurants and takeaway food outlets (9.5%), and Other retail trade (8.7%).


F1.3 TOURISM GROSS VALUE ADDED, BY SELECTED INDUSTRIES

1997-98
2000-01


Tourism gross value added
Share of TVA
Tourism gross value added
Share of TVA
$m
% pts
$m
% pts

Air and water transport
3,235
14.5
3,910
14.9
Accommodation
2,388
10.7
2,765
10.5
Cafes, restaurants and takeaway food outlets
2,207
9.9
2,504
9.5
Other retail trade
1,970
8.8
2,288
8.7
All other industries
12,588
56.2
14,817
56.4
Total
22,389
100.0
26,284
100.0

Source: Australian National Accounts: Tourism Satellite Account, 2000-01 (Cat. no. 5249.0)

Tourism consumption

Tourism consumption is the total consumption made by a visitor or on behalf of a visitor for and during his/her trip and stay at the destination. Tourism consumption increased from $58.2 billion to $71.2 billion between 1997-98 and 2000-01.

The international visitor share of total tourism consumption was 24.0% in 2000-01, up from 22.0% in 1997-98, reflecting the impact of the Sydney Olympics. Of the 76.0% contributed by domestic visitors in 2001, households accounted for 64.4% and business/government visitors accounted for 11.6%.

The bulk of domestic tourism was by overnight visitors (76.6%), with day visitors accounting for the remainder (23.4%).

The latest year for which full details of tourism consumption by product is available is 1999-2000. In that year, Long distance passenger transportation represented the largest proportion of tourism consumption at 17.8%, followed by Shopping (including gifts and souvenirs) (15.6%), Takeaway and restaurant meals (14.5%) and Accommodation services (9.0%).

There are some marked differences in consumption patterns by type of visitor. Long distance passenger transportation has been the dominant tourism product consumed by domestic business/government and international visitors. Shopping (including gifts and souvenirs) and Takeaway and restaurant meals were the dominant products purchased by domestic household visitors.

F1.4 SHARE OF TOURISM CONSUMPTION ON SELECTED TOURISM PRODUCTS 1999-2000, BY TYPE OF VISITOR

Households
Business/government
International
All visitors
%
%
%
%

Long distance passenger transportation
9.7
40.9
29.3
17.8
Shopping (including gifts and souvenirs)
18.8
0.3
14.4
15.6
Takeaway and restaurant meals
18.6
6.5
6.6
14.5
Accommodation services
5.4
21.5
12.8
9.0
Food products
9.9
0.7
6.4
8.0
Fuel (petrol, diesel)
8.6
12.8
1.2
7.4
Taxi products
0.4
3.3
0.7
0.8
All other tourism products
28.7
14.1
28.7
27.0
Total
100.0
100.0
100.0
100.0

Source: Australian National Accounts: Tourism Satellite Account, 2000-01 (Cat. no. 5249.0)

Tourism consumption by households increased from $38.8 billion to $45.9 billion between 1997-98 and 2000-01. Tourism consumption of domestic business/government rose from $6.6 billion to $8.2 billion, and international visitor consumption increased from $12.8 billion to $17.1 billion. Total tourism consumption growth was 5.9% and 5.0% in 1998-99 and 1999-2000 respectively, followed by strong growth of 10.1% in 2000-01. The growth for 2000-01 mainly reflects the impact of the GST on prices paid. Growth in domestic tourism was strongest in services, which attracted GST for the first time. Also, Recreational, cultural and sports services were particularly boosted by expenditure on Olympics tickets. International visitor consumption by product data are not yet available for 2000-01.

F1.5 GROWTH IN TOURISM CONSUMPTION


International trade in tourism

Tourism makes an important contribution to Australia's export earnings. In 2000-01, international visitors consumed $17.1 billion worth of goods and services produced by the Australian economy. This represented 11.2% of total exports of goods and services. Although tourism exports have grown quite strongly since 1997-98, so have exports of other goods and services, resulting in a slight decline in the tourism share since 1998-99.

F1.6 EXPORTS OF TOURISM PRODUCTS AND SERVICES

1997-98
1998-99
1999-2000
2000-01

International visitor consumption ($m)
12,792
13,446
14,611
17,100
Total exports ($m)
113,744
112,025
125,972
153,140
Tourism share of exports (%)
11.2
12.0
11.6
11.2
Growth in international visitor consumption (%)
..
5.1
8.7
17.0
Growth in total exports (%)
..
-1.5
12.4
21.6

Source: Australian National Accounts: Tourism Satellite Account, 2000-01 (Cat. no. 5249.0)


Exports of tourism characteristic products compare favourably with other Australian 'traditional' export products. For example, exports of tourism products is higher than coal, and iron, steel and non-ferrous metals, but lower than food and live animals.

F1.7 SELECTED EXPORTED COMMODITIES, AS A PERCENTAGE OF TOTAL EXPORTS

1997-98
%
1998-99
%
1999-2000
%
2000-01
%

Coal
8.4
8.3
6.6
7.1
Iron, steel, non-ferrous metals
6.3
6.2
7.0
6.6
Food and live animals
14.1
13.8
13.4
13.1
Tourism products
11.2
12.0
11.6
11.2

Source: Australian National Accounts: Tourism Satellite Account, 2000-01 (Cat. no. 5249.0)


Tourism employed persons

There were 551,000 persons in tourism generated employment in 2000-01. The number of tourism employed persons grew 7.4% between 1997-98 and 2000-01, faster than the growth rate in total employed persons (6.4%) over that period. However, the tourism share of total employed persons remained constant at 6.0% in each year.

The tourism share of total employment is higher than the tourism share of industry gross value added. This is because tourism tends to be more labour intensive, on average, than other forms of economic activity.

Retail trade generated the most tourism employment. Retail trade, Accommodation, and Cafes and restaurants accounted for more than half of the employment generated by tourism.

Visitor numbers

Domestic visitor numbers declined in 2000-01. Although the number of overnight visitors increased by 1.8 million in this year, the number of same day visitors fell by 14.3 million.

F1.8 DOMESTIC VISITOR NUMBERS

1997-98
1998-99
1999-2000
2000-01
'000
'000
'000
'000

Same day visitors
154,581
160,316
167,054
152,765
Overnight visitors
74,665
73,830
72,017
73,819
Total
229,246
234,146
239,071
226,584

Source: Australian National Accounts: Tourism Satellite Account, 2000-01 (Cat. no. 5249.0)

F1.9 GROWTH IN DOMESTIC VISITOR NUMBERS



Short term international visitor arrivals to Australia exceeded 5 million in 2000-01. The number of arrivals grew strongly in 1999-00 and 2000-01 (up 8.5% and 8.8% respectively).

F1.10 INTERNATIONAL VISITOR NUMBERS

1997-98
'000
1998-99
'000
1999-2000
'000
2000-01
'000

International visitors
4,220
4,288
4,652
(a)5,061

Note: (a) Short-term international visitor arrivals data are preliminary for 2000-01.
Source: Australian National Accounts: Tourism Satellite Account, 2000-01 (Cat. no. 5249.0).

F1.11 GROWTH IN INTERNATIONAL VISITOR NUMBERS


CONCLUSION

The results of the 2000-01 TSA affirm the importance of tourism to the Australian economy. Domestic spending was the major component in the $71.2 billion worth of goods and services consumed by visitors in 2000-01, while preliminary estimates indicate that the international sector consumed more than $17 billion.

A TSA has been recognised internationally as the best method for measuring the economic contribution of tourism. Further details can be found in Australian National Accounts: Tourism Satellite Account 2000-01 (Cat. no. 5249.0), or contact Luisa Ryan on Canberra 02 6252 7346. Key results are available on the ABS web site < www.abs.gov.au >.

For an analysis of the key findings of the first TSA (relating to 1997-98), see the June quarter 2000 issue of Tourism Indicators, Australia (Cat. no. 8634.0). An article on the development of the first TSA, including key concepts and definitions, can be found in the March quarter 2000 issue of Tourism Indicators, Australia.


APPENDIX TO THE FEATURE ARTICLE: KEY DEFINITIONS USED IN THE TSA

CONCEPTS AND METHODS

The concepts and methods used in the calculation of the Australian TSA are based on international standards for TSAs which are published in Tourism Satellite Account: Recommended Methodological Framework (2001). This document is a joint publication by an Inter-Secretariat Working Group made up of the United Nations (UN), Organisation for Economic Co-operation and Development (OECD), World Tourism Organisation (WTO) and Eurostat (Statistical Office of the European Communities).


DEFINITION OF TOURISM

'Tourism' comprises the activities of persons travelling to and staying in places outside their usual environment for not more than one consecutive year for leisure, business and other purposes not related to the exercise of an activity remunerated from within the place visited. The TSA refers to these persons as 'visitors'.

Tourism is not an industry in the traditional sense because industries are classified in accordance with the goods and services that they produce, whereas tourism depends on the status of the customer. Nearly all of the broad industry groups are involved to a greater or lesser extent in providing goods and services directly to visitors. While all the products that are produced and consumed in meeting tourism demand are embedded in the core national accounts, they are not readily apparent.

The TSA partitions industries into tourism and non-tourism activities so that the direct contribution of tourism to the economy can be measured on a consistent basis with 'traditional' industries such as agriculture, manufacturing and retail trade.

The estimates of tourism gross value added, Tourism GDP and tourism employment, relate only to the direct impact of tourism. A direct impact occurs where there is a direct relationship (physical and economic) between the visitor and producer of a good or service. (For estimates of tourism's indirect contribution to the economy, see: Research Paper No. 6: Tourism's Indirect Economic Effects 1997-98 published by the Bureau of Tourism Research in 2001. The Bureau of Tourism Research plans to update these estimates in the future.)


TOURISM CHARACTERISTIC INDUSTRIES AND PRODUCTS

Tourism characteristic industries are those industries that would either cease to exist in their present form, producing their present product(s), or would be significantly affected if tourism were to cease. In the Australian TSA, for an industry to be characteristic, at least 25% of its output must be consumed by visitors.

Tourism characteristic industries are:
  • Travel agency and tour operator services;
  • Taxi transport;
  • Air and water transport;
  • Motor vehicle hiring;
  • Accommodation; and
  • Cafes, restaurants and takeaway food outlets.

Tourism characteristic products are those products which represent an important part of tourism consumption, or for which a significant proportion of the sales are to visitors. For a product to be 'characteristic' it must account for at least 10% of total tourism consumption and/or at least 25% of the total output of the product must be consumed by visitors.

Tourism characteristic products are:
  • Travel agency and tour operator services;
  • Taxi fares;
  • Long distance passenger transportation;
  • Motor vehicle hire and lease;
  • Accommodation services;
  • Takeaway and restaurant meals; and
  • Shopping (including gifts and souvenirs).


TOURISM CONNECTED INDUSTRIES AND PRODUCTS

Other industries and products connected with tourism (but less significant to tourism) are described as tourism 'connected'. This definition refers to those industries and products not characterised as tourism characteristic, for which a tourism related product is directly identifiable and consumed by visitors in volumes which are significant for the visitor and/or producer.