The Economic Importance of Tourism in Australia’s Regions
ISBN 978-1-921812-27-9
Tourism Research Australia GPO Box 1564 Canberra ACT 2601 Phone: 6243 7745 Email: [email protected] Web: www.ret.gov.au/tra
Publication date: April 2011
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Contents
1 Introduction ...... 1
2 Australia’s tourism regions ...... 1
3 Methodology ...... 5
4 Results ...... 6
5 Conclusion ...... 11
Appendices
Appendix A: Detailed methodology ...... 12
A1 Tourism output ...... 12
A2 Regional output ...... 15
A3 Data sources ...... 17
Appendix B: Detailed results ...... 18
Glossary of terms ...... 25
References ...... 26
Tables
Table 1: Tourism regions by state/territory ...... 2
Table 2: Top 20 tourism regions by economic importance of tourism...... 6
Table 3: Less dependent regions with larger tourism industries ...... 9
Figures
Figure 1: Total tourism expenditure in 2007/08 ...... 4
Figure 2: Economic importance and total tourism expenditure in 2007/08...... 8
Figure 3: Comparison between industry size and economic importance of tourism ...... 10
1 Introduction
Tourism plays a significant part in the Australian economy, contributing 2.6% to Australia’s GDP and 4.5% to Australia’s employment in 2009–10. With 46% of tourism expenditure in Australia spent in regional areas1, tourism is also of considerable importance to many of Australia’s regional communities. To determine the extent of tourism importance, this report estimates the economic importance of tourism across each tourism region in Australia by:
• comparing the value of each region’s tourism industry to its local economy, and • ranking each region by the relative importance of tourism to their local economies.
Section 2 of this report outlines the composition of the tourism regions, Section 3 summarises the methodology used to calculate the economic importance of tourism in each region and Section 4 reports on the key findings. Finally, Section 5 summarises the results.
2 Australia’s tourism regions
Australia has 84 tourism regions2; each tourism region is made up of a number of Statistical Local Areas (SLAs), as defined by the Australian Bureau of Statistics in consultation with state and territory tourism organisations.
This report estimates the economic importance of tourism for all regions except Lord Howe Island. In addition, some regions in the Northern Territory have been combined due to data reliability issues. Table 1 lists the regions for which economic importance has been estimated.
1 Based on TRA regional expenditure estimates (2009-10, unpublished data). Note the estimate excludes the Gold Coast. 2 Based on 2009 concordances. See ABS 2009, cat no. 9503.0.55.001.
1
Table 1: Tourism regions by state/territory No. of State/territory Tourism regions regions
Blue Mountains New England North West Capital Country Outback NSW Central Coast Riverina New South Wales Central NSW Snowy Mountains 14 (NSW) Hunter South Coast Mid North Coast Sydney Northern Rivers The Murray
Ballarat Melbourne Bendigo Loddon Melbourne East Central Highlands Murray East Central Murray Peninsula Geelong Phillip Island Victoria (Vic) Gippsland Spa Country 21 Goulburn Upper Yarra High Country Western Lakes Western Grampians Macedon Wimmera Mallee
Brisbane Mackay Bundaberg Northern Central Queensland Outback Queensland (Qld) 12 Darling Downs Sunshine Coast Fraser Coast Tropical North Qld Gold Coast Whitsundays
Adelaide Kangaroo Island Adelaide Hills Limestone Coast Barossa Murraylands South Australia (SA) Clare Valley Outback SA 13 Eyre Peninsula Riverland Fleurieu Peninsula Yorke Peninsula Flinders Ranges
Australia’s Coral Coast Australia’s South West Western Australia (WA) Australia’s Golden Outback Experience Perth 5 Australia’s North West
East Coast North West Hobart and Surrounds Southern Tasmania (Tas) Launceston and Tamar West Coast 7 Valley Northern
Alice Springs Darwin Northern Territory (NT) Central (includes Barkly, Top End (includes Arnhem, 4 Central Desert, Yulara) Kakadu, Katherine Daly)
Australian Capital Canberra 1 Territory (ACT) Total number of regions 77
2
Australia’s regional tourism industries are not all equal in size, and visitor numbers, tourism output, and tourism expenditure can vary greatly from region to region. To gauge the size of regional tourism industries, Tourism Research Australia (TRA) has used modelled estimates of regional tourism expenditure3 using data from the National Visitor Survey and International Visitor Survey. Total tourism expenditure is calculated by combining estimates for each tourism region’s domestic day, domestic overnight, and international visitor expenditure.
Based on total tourism expenditure estimates for 2007/084, the five largest tourism regions in Australia are Sydney, Melbourne, Brisbane, the Gold Coast, and Experience Perth. Together, these regions account for close to half (47%) of Australia’s tourism expenditure. Furthermore, the top ten regions account for over three fifths of Australia’s total tourism expenditure. The remaining tourism regions in Australia (67) have comparatively small tourism industries. Figure 1 shows the spread of tourism expenditure across Australia’s tourism regions in 2007/08.
3 The amount paid by a visitor or on behalf of a visitor for and during his/her trip and stay at the destination (ABS 2010 cat no. 5249.0). 4 Due to the lack of more recent data on personal income (see Section 3), the estimates relate to the 2007/08 financial year.
3
Figure 1: Total tourism expenditure in 2007/08
Gold Coast Brisbane Sydney Melbourne Experience Perth 18.8 - 500.0 - 18.8 1000.0 - 500.1 2000.0 - 1000.1 5000.0 - 2000.1 12000.0 - 5000.1 Legend DependencyTourism Ratio tourismTotal expenditure ($m) EXP_MIL
4
3 Methodology
To determine the economic importance of tourism in a regional economy, the ratio of each region’s total tourism output to its total output is estimated. As data on these variables are not available at the regional level, proxy variables for tourism output and total output are estimated.
TRA’s total tourism expenditure estimates for day, overnight and international visitors are used to approximate tourism output. The difference between tourism expenditure and tourism output is that tourism output excludes taxes and subsidies that would otherwise be incurred by the producer in selling a tourism-related good or service. As such, the estimates of total tourism expenditure are adjusted in order to approximate tourism output.
To estimate the total output in each region, ABS data for total state/territory output are used along with data on personal income earned in each region. The data on total personal income – the amount of income5 earned by its residents – are used to calculate the percentage of total state/territory personal income attributable to each region. This percentage is then applied to the relevant state/territory’s total output in order to derive an estimate for total output in the region.
For example, total personal income in the South Coast region ($9.2 billion) accounts for 5% of total personal income in New South Wales ($185.5 billion). This percentage is multiplied by the state’s total output ($683.7 billion) in order to obtain an estimate of the South Coast’s total output ($33.8 billion).
Once estimates for tourism output and total regional output are obtained for each tourism region, the economic importance of tourism is estimated by finding the ratio of tourism output to total output for each tourism region.