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LC EIC Inquiry Into the Impact of the COVID-19 Pandemic on the Tourism and Events Sectors Submission 084 1

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LC EIC Inquiry Into the Impact of the COVID-19 Pandemic on the Tourism and Events Sectors Submission 084 1 LC EIC Inquiry into the impact of the COVID-19 pandemic on the tourism and events sectors Submission 084 INCORPORATED Level 1, 48 Brougham St Geelong VICTORIA Australia 3220 T: 03 5223 2588 F: 03 5223 2069 I: 61 3 5223 2588 ACN: A00 286 22D ABN: 26990 691 173 14 April 2021 The Secretary Economy and Infrastructure Committee Parliament House, Spring Street EAST MELBOURNE VIC 3002 Dear Secretary, RE: INQUIRY INTO THE IMPACT OF THE COVID-19 PANDEMIC ON THE TOURISM AND EVENTS SECTORS Thank you for this opportunity to contribute to The Legislative Council’s Economy and Infrastructure Committee’s inquiry into the impact of the COVID-19 pandemic on the tourism and events sectors. This inquiry is a welcomed recognition of the challenges that are being faced and the struggles still ahead for the tourism and events industry, as the country establishes its COVID-normal behaviours and lifestyle changes. The Visitor Economy in Victoria needs support with its recovery and resilience building in the wake of the pandemic’s direct impacts on our tourism and events industries. Tourism Greater Geelong and The Bellarine is the regional tourism organisation spanning from Werribee to Armstrong Creek including Geelong, The Bellarine, Queenscliff and the Moorabool Valley. Our submission has been developed on behalf of and in support of the local tourism and events industry represented by our 800- strong membership base and in partnership with our municipal partners, the City of Greater Geelong, Borough of Queenscliffe and Golden Plains Shire. Pre-COVID the $1.1 billion Greater Geelong visitor economy was a significant contributor to the local GDP representing 25% of total spend and supporting 1 in 10 jobs attracting over 6.4 million visitors who spent 5.7 million nights within the region in 2019. Primarily a domestic short break market, Victorians made up 84% of total visitation to the region, half of which came from as close as Melbourne, an hour drive down the highway. In addition to the region’s strong business and leisure travel, Geelong welcomed over 4,000 international students who resided in the region during 2019 and whom contributed in excess of $128m to the region’s economy on top of course fees. With the addition of international flights through Avalon Airport from 2018, increased connectivity to Melbourne via road, train and ferries plus a looming convention and exhibition centre, the region was on track to surpass it’s 2027 targets of becoming a $1.7b economy attracting over 7.5 million visitors. COVID-19 has directly impacted the visitor economy through restrictions on travel and social distancing and an indirect impact due to a deep, if expected to be brief, Australian economic recession. The pandemic has proven detrimental to the prosperity of the tourism industry within Greater Geelong forcing mass business closures, lost income and unemployment, all underpinned by great uncertainty. PLATINUM PARTNER 1 LC EIC Inquiry into the impact of the COVID-19 pandemic on the tourism and events sectors Submission 084 INCORPORATED Level 1, 48 Brougham St Geelong VICTORIA Australia 3220 T: 03 5223 2588 F: 03 5223 2069 I: 61 3 5223 2588 ACN: A00 286 22D ABN: 26990 691 173 The key challenges our region is set to face through the second phase of recovery include: • Greater concentration of visitor spending on weekends away from weekdays; • Increased profitless volume in 2020/21 – with visitation doing better than spending and restricting visitor economy profitability; • Visitor accommodation properties in the Greater Geelong region will have a highly variable recovery depending on their market mix and financial reserves; • Staffing the Greater Geelong region visitor economy will have fresh challenges of training and recruitment of Australian workers in the recovery phase; • Expected shifts in international visitation once borders re-open; • Increased need for more urgent Government delivery of investment in visitor economy game changing projects in the Geelong region. E.g. progressing Geelong City Deal Projects such as the Geelong Convention and Exhibition Centre and need to attract private investment in product and experience development projects that will drive visitation. It is also expected that the regions visitor profiles will significantly change over the next three years. The fastest markets to recover will be the lower yielding markets of domestic day trips and visiting friends and relatives (VFR) travel. Following the extended lockdown period, the region has noticed a flurry of holiday bookings, particularly for weekend travel and very minimal for mid-week. What is certain is that tourism will not come back the same nor will traveller patterns, profiles and booking behaviours. We need to support the tourism and events industry in preparing for and adjusting to a new normal. To echo the comments made by the Victorian Tourism Industry Council, ‘the recent events in southern Queensland and northern NSW are a stark reminder that the impacts of this pandemic continue to challenge our operations and reinforce the fragile nature of any recovery for our industry. These ongoing disruptions only serve to substantiate why the industry needs continued support at both the State and Federal level to sustain a solid pathway to recovery.’ We strongly support the initiatives and recommendations outlined in the latest version of the Visitor Economy Recovery Plan set by the Victorian Tourism Industry Council as a blueprint for recovery designed to rescue jobs and rebuild our industry as we face the ongoing challenges of COVID-19. Economic Impact Data presented by ID Consultancy showed three of the top five sectors impacted by COVID-19 in Greater Geelong are part of the tourism industry with the accommodation and food services by far the greatest hit, with a combined loss of $127m for the June 2020 quarter alone. Other sectors within the tourism industry included retail which recorded a loss of $87m and the Arts with a loss of $67m, close to 26% of Greater Geelong’s $1.1b visitor economy. Prepared by Decisive Consulting in March 2021 on behalf of Tourism Greater Geelong and The Bellarine, the following table details forecasts under both a slow and fast recovery scenario for the Greater Geelong region. PLATINUM PARTNER 2 LC EIC Inquiry into the impact of the COVID-19 pandemic on the tourism and events sectors Submission 084 INCORPORATED Level 1, 48 Brougham St Geelong VICTORIA Australia 3220 T: 03 5223 2588 F: 03 5223 2069 I: 61 3 5223 2588 ACN: A00 286 22D ABN: 26990 691 173 Mental Health and Wellbeing Impact This is one of the most critical issues facing the tourism and events industry post lengthy business closures, ongoing financial strain, staff cuts and lost livelihoods. Mental health and wellbeing will be a significant side- effect to COVID-19 and one that will impact small to medium business owners most, those who have invested their life into these businesses. The drawn-out impacts of mental health and wellbeing of those invested in and working within the tourism and events industry will be long lasting and extend well beyond the expectations for economic and visitor recovery. Tourism Greater Geelong and The Bellarine have identified this as a critical element within our recently developed four-year Corporate Plan and will dedicate time, budget and effort to supporting both the people and businesses of the local tourism and events industry with a heightened focus on collaboration, wellness and connection. Workforce and Business Impact The local visitor economy of Greater Geelong directly supports 1 in 10 jobs across 1,486 employing tourism dependant businesses. With a workforce pre-COVID of 7,551 directly employed within the Greater Geelong tourism industry and a further 3,713 indirectly, backed by a visitor economy experiencing double digit growth the region was set to grow to $1.7b and employ more than 17,200 people by 2027, an increase of 53% on 2019. Following the fallout from COVID-19 and resulting business closures it has been estimated that around 2,618 to 3,635 total jobs are predicted to be lost due to falls in visitor economy spending by the end of 2020/21. Even a further two years later a further 348 to 935 will be lost by the end of 2022/23 under the two forecast scenarios due to reduced visitor economy spending in the Greater Geelong region by 348 or 935 jobs compared to 2018/19. These numbers have a significant and long-lasting impact on the local community equating to 70% of the overall direct tourism workforce in Geelong. As explained by Decisive Consulting, Australians are living in an artificial bubble right now awaiting the second hit on employment when business insolvencies and job cuts are likely to surge as: • Insolvencies are again allowed from the beginning of 2021; • Emergency Job Keeper and temporary additional JobSeeker income support is progressively reduced from early October and concluded in March 2021; and • Mortgage, and rent repayment holidays and cash boost funding for small businesses are unwound over a similar timeframe. • These short-term realities have had a medium to long term impact on the local businesses, many of whom are facing staffing supply issues to meet the upbeat demand over summer alone. Local education institutions and industry have indicated that there has been a noticeable shift away from the sector to more ‘secure’ industries. This will see a significant portion of those who benefited on Job Keeper within the hospitality sector are less likely to return to the jobs they left. It is also highly expected that industry will face a further impact of attracting ongoing staff to new products and tourism assets in the region when they open. There are 55 major infrastructure projects and 9 PLATINUM PARTNER 4 LC EIC Inquiry into the impact of the COVID-19 pandemic on the tourism and events sectors Submission 084 INCORPORATED Level 1, 48 Brougham St Geelong VICTORIA Australia 3220 T: 03 5223 2588 F: 03 5223 2069 I: 61 3 5223 2588 ACN: A00 286 22D ABN: 26990 691 173 masterplans in the pipeline supporting the Greater Geelong visitor economy totalling $1.7 billion.
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