Tourism industry growth exceeds $50 billion mark for first time
Sept. 8 -- Empire State Development (ESD) today announced a 9 percent increase in direct tourism spending for New York State in 2007. Last year visitors spent $51 billion in the local economy, according to a study commissioned by the Department of Economic Development’s Division of Tourism. This includes a $44 billion contribution to the State’s Gross Domestic Product (GDP), a 12 percent increase that exceeds the State’s overall GDP growth by 5 percent.
A vital and growing component of the State’s economy, tourism spending has seen exceptional growth for four consecutive years, with the growth rate accelerating over 2005 (8.6%) and 2006 (7.2%). As the ninth largest employer in the state, tourism supported 672,000 jobs, or 6 percent of all employment during 2007, with a total associated income of $26 billion. Tourism generated $6.8 billion in state and local taxes.
The results of the study commissioned by the Division of Tourism follow the Governor’s May announcement of a revitalized long-term marketing strategy for the iconic “I LOVE NY” brand campaign that is anticipated to increase New York State tourism spending to $60 billion by the year 2020. This new direction promotes New York as a high value drive-to destination for 80 million people who live within a 5-hour drive, as well as the influx of Canadian and European travelers who benefit from the exchange rate.
While domestic tourism increased 7 percent last year, overseas and Canadian visitors were the most significant contributors to this growth due in part to this beneficial exchange rate. New York saw a 15 percent jump in overseas visitor spending in 2007 while Canadian spending rose 11 percent. This translates to nearly $14.4 billion in international visitor spending, representing 28 percent of all visitor spending in 2007.
Indicators suggest tourism can continue to bolster the New York State economy despite the current recessionary climate. Canadian and overseas travelers continue to benefit from an extremely favorable exchange rate in 2008 with the US Department of Commerce reporting international arrivals to the United States up 11.5 percent in the first 4 months of this year.
Hotel rooms sold and room revenues, a concrete early indicator of the tourism industry performance, show New York State continues to hold steady in the first seven months of 2008, particularly compared to the national average. While the nation has seen declines in rooms sales and only a 3.7% growth in room revenue relative to the first 7 months of 2007, New York room sales rose 3% and revenues grew over 9%. For the critical month of July, room sales were up 4% and revenues were up 11% relative to July of 2007. In addition, employment in Leisure and Hospitality as reported by NYS Department of Labor has grown 1 percent relative to June 2007 amidst stagnation in employment growth statewide and a broader economic slowdown.
“The increase in tourism spending is especially significant in today's tough fiscal climate as it is essential to the overall economic health and vitality of New York State that its tourism industry remains highly competitive,” stated Kenneth A. Schoetz, acting upstate chairman of Empire State Development. “New York’s unique cultural and entertainment offerings are varied and vast enough to fit into any vacation budget, whether it's touring through the Finger Lakes, simply enjoying the sea shore on Long Island or living it up in one of our great cities. The results of the study are very encouraging and prove once again that New York State continues to be a great choice for vacationers everywhere.”
“Tourism continues to be a driving force for economic growth in New York State,” said Avi Schick, Downstate ESDC President. “The strategy we have been pursuing this past year is enabling us to make the best of the current economic situation – exposing domestic travelers who are re-evaluating their travel options to the high-value destinations of New York, and harnessing the influx of international travelers to drive visitation to new parts of the state.”
“With the state’s current economic condition it’s especially critical that we maintain a strong statewide brand and we continue to do that,” said Thomas Ranese, ESDC Chief Marketing Officer. “We are using the best and most up-to-date marketing techniques to increase awareness of the many natural, historic and cultural attributes that New York State has to offer and we are seeing the fruits of our labor. The remarkable growth seen over the past four years proves that New York State’s tourism industry continues to be a valuable asset to the state’s economy.
“Typically, we would expect a letup after such exceptional period of growth. Yet New York has essentially gone from strength to strength over the past four years,” said Adam Sacks, Managing Director of Tourism Economics, the firm commissioned to measure the economic impact of tourism for the state.