Tourism industry could take years to recover from shutdown

Tourism industry could take years to recover from shutdown
Washington Tourism Alliance Interim Executive Director David Blandford warns that Washington’s tourism industry in both urban and rural communities could take years to recover. Photo: freepik.com

Washington’s tourism industry continues to struggle amid the state’s economic shutdown in response to COVID-19, with the effects felt in both urban and rural areas. On top of that, cities like Seattle must also contend with concerns about public safety following numerous demonstrations and riots that culminated in the formation of a so-called “autonomous zone” in the Capitol Hill neighborhood.

Washington Tourism Alliance Interim Executive Director David Blandford told the Senate Special Committee on Economic Recovery (SCER) at its Sept. 28 meeting that it could take several years for the industry, the fourth largest in the state, to fully recover. Since March, there’s been a 75 percent reduction in visitor spending—a total of $4 billion. Leisure and hospitality remain the most impacted industry, composing 42 percent of statewide unemployment.

“All these sectors work in tandem,” Blandford said. “Partnership is a big part of the industry business model for mutual success.”

The loss of summer month tourism could have significant implications for regions such as Central Washington. Wenatchee Valley Chamber of Commerce Executive Director Shiloh Burgess also chairs the Washington Tourism Alliance, which is working on branding Washington as a tourist destination on behalf of the Washington Tourism Marketing Authority (WTMA).

She told SCER that tourism industry businesses in Chelan County, which includes the Bavarian-themed city of Leavenworth, make up eight percent of all employment. In the past decade, the health services, accommodation, and food service industries made up 60 percent of 5,105 jobs added to that county.

Following massive job loss earlier this year, the county’s tourism industry has only recovered 20 percent of its employment while 2,500 people remain unemployed, according to Burgess.

“That is important because this is our busiest season,” she said. “If those jobs were going to come back aggressively, they would have come back in the second and third quarter of the year and that has not happened.”

This is reflected especially within the hotel business. August represented the first “real profitable” month the entire year, she said, while Wenatchee’s lodging tax revenue is down by 50 percent. County-wide hotel occupancy in August was 66 percent compared to 75.7 percent the same month last year.

The situation is perhaps even worse in downtown Seattle, where 126 street-level businesses have closed since March. Prior to the COVID-19 response, the 50 hotels in downtown had an occupancy rate of 80 percent, which then fell below 20 percent and remained there until early September.

Visit Seattle President and CEO Tom Norwalk told SCER that it’s typical for hotels to have a 90-94 percent occupancy rate during peak months in the summertime.

That is perhaps due to the loss of 45 conventions scheduled for the Washington State Convention Center, with an additional 16 conventions planning to cancel. The convention center remains closed, and Norwalk said that there are conventions scheduled as far ahead as 2022 that are also looking to cancel.

“The entire industry has shifted,” he said. However, he added that “as online meetings are perfected, as the phases and COVID infection rates allow, we know that people are really anxious to get back together.”

Governor Jay Inslee recently released guidelines for meetings and gatherings in Phases 2-3 allowing for convention space of 30 percent – or no more than 200 people. Norwalk said this could be a “life saver for many as we move into late fall and winter months.”

Allowing limited conventions could also help small nearby businesses reopen. Pike Street Hospitality Group Owner Travis Rosenthal told SCER that “there’s no tourism, there’s no nothing.”

He added that “I don’t know if I expect a strong return to indoor seating. You’re just going to see the unemployment rate for the hospitality industry, in my opinion, skyrocket come fall and winter. For me, it’s about how do we survive the winter?”

In addition to the loss of nearby conventions, downtown Seattle businesses have also suffered due to recent riots and protests that have generated a separate kind of safety concern from COVID-19. Blandford noted that while West Coast cities such as Seattle have seen a drop in visitors, outlying areas have not. “A lot of our rural colleagues and resorts are doing well, especially on weekends.”

“Safety for travel has become and has been one of the number one factors in people choosing where to go,” he added. “It’s a major concern as we restore travel and restore tourism, making sure that our destination is safe, that it’s healthy from a COVID stance and protocols, but it also speaks to the business closures. How does our city recover from a destination standpoint of being attractive and sought out to visit?”

There are no meetings yet scheduled for SCER.

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