Second wave of COVID-19 pandemic brought a new hit to travel and tourism businesses and slowed down the recovery of the entire market
The COVID-19 pandemic has affected every sector globally, but the travel and tourism industry is among the hardest hit. Although hotels and resorts implemented increased safety and sanitation measures and cautiously reopened in the second half of 2020, the second wave of the pandemic brought a new hit to businesses operating in the sector and slowed down the recovery of the entire market.
According to the most recent data, the combined revenues of the travel and tourism industry are expected to reach $540 billion in 2021, almost a $200 billion plunge compared to 2019 figures.
Post-COVID-19 Recovery to Last for Three Years
In 2017, the entire travel and tourism sector generated $688.5 billion in revenue, revealed the survey. Over the next two years, this figure jumped by 7% and hit $738.8 billion.
However, the year 2020 triggered the biggest market contraction in history. Countries across the globe imposed lockdown rules to curb the spread of the virus, leading to thousands of canceled vacations, and closed hotels between March and May. Although many of them lifted off travel restrictions in the second half of 2020, it wasn’t enough to cover colossal revenue losses produced in the first two quarters of the year.
Statistics show the travel and tourism industry’s revenues plunged by 52% to $348.8 billion amid the COVID-19 crisis. The data also indicate it will take years for the entire sector to recover from the effects of the coronavirus pandemic. In 2021, revenues are projected to grow by 54% year-over-year to $540 billion, 26% less than in 2019.
The year 2022 is forecast to witness $666.1 billion in revenues, still $72.7 billion below pre-COVID-19 levels. By the end of 2023, travel and tourism revenues are expected to rise to $768.4 billion.
As the market’s largest segment, the hotel industry is forecast to generate $284.7 billion in revenue this year, 22% less than in 2019. The package holidays segment is set to reach a $171.4 billion value in 2021, an $87 billion plunge compared to pre-COVID-19 figures. Vacation rentals and the cruise industry follow with $66.9 billion and $16.8 billion in revenue, respectively.
The Number of Users to Grow by 46% YoY to 1.8 Billion, Still 26% Below Pre-COVID-19 Levels
The survey also revealed the number of users in the travel and tourism sector halved amid the coronavirus pandemic, falling from 2.4 billion in 2019 to 1.2 billion in 2020. Although this figure is expected to rise to 1.8 billion in 2021, it still represents a 26% drop compared to pre-COVID-19 levels.
Statistics show the number of users in the cruise industry is forecast to reach 17 million this year, a 41% plunge in two years, and the most significant drop among all market segments. The package holidays segment is set to reach over 335 million users in 2021, 37% less than in 2019. The hotel industry follows with a 24% drop in two years and 845.7 million users as of this year.
Analyzed by geography, the United States represents the largest travel and tourism industry globally, expected to reach $104.5 billion value this year, $40 billion less than in 2019.
The revenues of the Chinese market, as the second-largest globally, are forecast to jump by 67.5% year-over-year to $89.3 billion in 2021, still $30 billion below pre-COVID-19 levels. Germany, Japan, and the United Kingdom follow with $45.8 billion, $29.3 billion, and $26.7 billion in revenue, respectively.