May 1st not only marks the start of National Travel and Tourism Week, but also California Tourism Month, a nationwide celebration of what the Golden State has to offer as a travel destination.
To mark the occasion, Visit California has just released a new report, prepared by Dean Runyan Associates, detailing the Economic Impact of Tourism in California for 2021. While the last year saw a nearly 50 percent increase in visitor spending, the overall results of the research show that the industry’s recovery is far from complete.
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In California’s gateway cities in particular — like San Francisco and Los Angeles — travel and hospitality revenues continue to lag significantly behind pre-pandemic numbers. Much of the cause can be attributed to ongoing global travel restrictions and U.S. entry requirements, as these major urban centers tend to attract many international travelers as well as domestic visitors. In fact, prior to the pandemic, international tourism spending was California’s biggest export.
Some key findings from the 2021 Economic Impact Report:
– In 2021, visitor spending in California reached $100.2 billion, a 46 percent increase from 2020.
– Tourism-generated tax revenue for state and local governments increased by a third last year to $9.8 billion.
– The state’s tourism jobs, half of which disappeared in 2020 at the onset of COVID-19, slowly returned in 2021, rising 6.4 percent to 927,000.
– Visitor spending in California, which hit record levels in 2019, was 69 percent of those before the pandemic. Only in one of the state’s 58 counties, rural Trinity County in northwestern California, has visitor spending surpassed the 2019 record.
– Famous urban destinations, which are home to most of California’s hotels, restaurants and tourist attractions, are particularly slow to recover. For example, San Francisco saw $6.1 billion in visitor spending in 2021, down just 43 billion from 2019’s $14.2 billion.
— Revenue from international visitor spending in 2021 was still drastically below pre-pandemic numbers, reaching just $5.4 billion compared to nearly $28 billion in 2019.
Graph showing recovery levels of tourism in California in 2021. (Image via Visit California)
“After a devastating 2020, visitor spending is on the path to recovery, but we still have a long way to go,” said Caroline Beteta, President and CEO of Visit California. “Cities continue to suffer without the critical international and corporate businesses.”
In an effort to revitalize business travel, Visit California has launched various initiatives to encourage the resumption of professional meetings and events in California in mid-2021 with the help of some state-approved stimulus funds.
In February, the state’s tourism marketing organization launched a new $22.1 million domestic branding campaign, “Am I Dreaming?”, which will continue throughout May. It premiered as a television spot during the Super Bowl pregame show to critical acclaim.
California’s progress towards economic recovery through 2021, by county. (Image via Visit California)
When the state’s border reopened in November 2021, the organization reintroduced marketing programs in several international source markets, including Mexico, Canada, the United Kingdom, France and Germany, hoping to inspire overseas travelers to visit the Golden State for their first Time to choose after the pandemic -Haul holiday.
Forecasts compiled by Tourism Economics and released by Visit California earlier this year predicted that the state’s travel spending would reach $144.6 in 2023, nearly matching 2019 levels. If that turns out to be the case, California’s tourism economy will have recovered to pandemic levels a full year earlier than last year’s predicted. New forecasts also project California’s travel spending to reach $155.9 billion in 2024.
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