Travel lost jobs in 2010, even with increased visitor spending
A record number of inbound travelers and a rebound in airline-ticket spending in 2010 weren’t enough to prevent a decline in tourism-related employment for the third consecutive year, according to an updated report by the U.S. Department of Commerce’s International Trade Administration last month.
This page is protected by Copyright laws. Do Not Copy. Purchase Reprint
Such results indicate that travel-service suppliers were looking to either shed losses or boost their bottom line before hiring more people to account for the travel-spending rebound.
U.S. travel and tourism employment, which accounts for about one in 17 U.S. non-farm workers, declined last year by 112,000 jobs, or 1.4%, after falling 7.8% in 2009, according to the report, which updated and added data to a Commerce Department study released in April.
Almost 1.1 million tourism jobs were lost between 2007 and 2010.
“Clearly, the economic downturn has taken a major toll on this industry,” the ITA said in the report. “In fact, the three years of declines in 2008, 2009 and 2010 are more than double the number of jobs lost in the three years following 9/11.”
Labor numbers fell even though a record 60 million visitors came to the U.S. last year, while inbound tourists spent $134.4 billion, up 12% from 2009, the Commerce Department reported in April.
The number of visitors from outside of Mexico and Canada reached pre-9/11 levels, largely on a surge of tourists from countries such as Brazil, China and South Korea.
Such increases are reflected in increasing prices for both airline tickets and travel accommodations. Airfares rose 9.1% on average last year, more than offsetting an 8.5% drop in 2009, while accommodation rates increased 1.1% in 2010 after falling 3.2% a year earlier, the ITA said in its most recent report.
Still, such price increases weren’t enough to stop airlines and hotels from cutting staff. Employment in air transportation services fell by 15,000, to about 750,000 jobs, the lowest on record.
The hotel sector, which is twice as large as the airline sector, declined by 13,000 jobs last year, to 1.6 million jobs, the ITA said.
Despite a rebound in passengers and the ability to raise ticket prices, many airlines have had to cut staff and other expenses in order to stem losses triggered largely by surging fuel prices, which rose 19% in 2010.
Southwest Airlines, long a model of airline profitability, cut 100 daily flights from its schedule this summer, though it later added a number of new routes.
Meanwhile, American Airlines parent AMR Corp. last week filed for Chapter 11 bankruptcy reorganization in an effort to shed some of its debt and labor-cost obligations. The company has reported losses in 11 of the last 12 quarters.
Whether such tourism employment declines carried into 2011 remains in question, though the U.S. Travel Association indicates that travel employment numbers are rebounding.
U.S. Travel said last month that the travel industry added 11,000 jobs in October — about one out of every eight jobs created in the U.S. — and that more than 200,000 travel jobs have been added since March 2010.
U.S. Travel has long argued that inbound travel spending, and as a result, U.S. tourism employment, has been hamstrung by the stricter homeland-security guidelines enacted after 9/11.
Specifically, the trade group has said that the nation’s global market share of long-haul inbound passengers, who tend to spend more money, has fallen relative to other countries because of its homeland security policies.