Tourism is a dynamic industry that has a significant impact on the global economy. It encompasses various activities, including accommodation, transportation, entertainment, and food services, which generate income and employment opportunities for millions of people worldwide. The economic impact of tourism can be seen in various sectors such as finance, agriculture, manufacturing, and infrastructure development.
What is Tourism Economic?
Tourism economic refers to the study of the economic aspects of tourism that includes analyzing the contribution of tourism to the gross domestic product (GDP), employment generation, investments in infrastructure development and its impact on local communities. It involves examining how money flows into an economy through tourism-related activities and how these activities benefit different stakeholders in the industry.
The Contribution of Tourism to GDP
Tourism is a significant contributor to many national economies worldwide. According to the World Travel & Tourism Council (WTTC), travel and tourism directly contributed $2.9 trillion to global GDP in 2019. This accounted for 10.3% of global GDP and supported over 330 million jobs worldwide.
In addition to direct contributions, tourism also has indirect impacts on GDP through its multiplier effect. For example, when tourists spend money on hotels or restaurants, these businesses use this revenue to pay their employees or purchase supplies from other local businesses. This creates a ripple effect throughout the economy, leading to increased economic activity and job creation.
Employment Generation
Tourism is a labor-intensive industry that generates employment opportunities across various sectors such as accommodation, transportation, food services, and retail. As per WTTC’s report ‘Travel & Tourism Economic Impact 2020’, it supported 1 in 10 jobs (330 million) worldwide in 2019 making it one of the largest employers globally.
Moreover, tourism also generates informal employment opportunities such as street vendors selling souvenirs or tour guides who operate independently without any formal arrangement with travel agencies or companies. Hence, tourism plays a crucial role in reducing unemployment and poverty in many countries.
Investments in Infrastructure Development
Tourism often requires significant investments in infrastructure development to support the growth of the industry. This includes airports, roads, public transport, accommodation facilities, and tourist attractions.
The investments made in tourism infrastructure not only benefit tourists but also local communities. Improved infrastructure can lead to better living conditions for locals by providing them access to better transport and healthcare services.
Impact on Local Communities
Tourism can have both positive and negative impacts on local communities. Positive impacts include employment generation, increased economic activity, and cultural exchange. However, negative impacts can include environmental degradation due to increased footfall in ecologically sensitive areas or displacement of local communities due to the development of tourist facilities.
Therefore, it is essential to ensure that tourism development is sustainable and benefits both tourists and local communities. Sustainable tourism practices promote responsible travel that minimizes negative impacts on the environment and maximizes socio-economic benefits for local communities.
Conclusion
In conclusion, tourism economic refers to the economic aspects of the tourism industry that includes analyzing its contribution to GDP, employment generation, investments in infrastructure development and its impact on local communities. Tourism is a vital contributor to many national economies worldwide and has significant potential for generating income and employment opportunities. However, it is essential to promote sustainable tourism practices that benefit both tourists and local communities while minimizing negative impacts on the environment.