WTTC Sectors Summary Global

Benchmarking Travel & Tourism
Global summary
How does Travel & Tourism compare to other sectors?
Sponsored by:
Summary of Findings, April 2012
Foreword
For over twenty years WTTC has worked to bring the Travel & Tourism private sector together to speak with one voice. Our Members know that progress will only be made with clear, unambiguous and unified messages. From the outset, our Members understood that hard economic facts were the crucial foundation upon which to base these messages. As a result WTTC has invested heavily in developing a methodology to measure the economic impact of Travel & Tourism around the world. In 2011 we accounted for 9% of GDP, a total of 6 trillion dollars. We supported 255 million jobs. That means one in 12 jobs on the planet. However, it is no longer sufficient just to communicate how important we are as an industry. We have to recognise that in government eyes Travel & Tourism is just one activity that sits alongside many other sectors. These other sectors are better understood than our industry. When we hit the depths of the last recession, which industries immediately dominated the attention of governments around the world particularly in the US and Europe? The answer was financial services and automotive manufacturing. Both received billions of dollars of government cash to keep them functioning. With the support of our Founding Member American Express, we have executed this substantial research study, which puts Travel & Tourism in the broader context of other sectors, and the messages emerging are powerful.
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David Scowsill
President & CEO World Travel & Tourism Council
World Travel & Tourism Council
Foreword
More than any other, the travel industry drives commerce and business, facilitates connections and enables tourism and adventure. American Express has a proud heritage of more than 160 years in travel and were pleased to support this new research with WTTC to ensure that travel stays vibrant and vital for many years to come. When American Express helped to establish WTTC more than 20 years ago, we started with a firm belief in the value of travel and a hope to spread that message across the world. Were proud that WTTC has been a driving force in increasing awareness of the positive impact of travel and tourism ever since. This new analysis gives our industry an important tool at our fingertips to benchmark the role that travel and tourism plays in the global marketplace. In a year when Travel & Tourism is projected to directly contribute $2 trillion and 100 million jobs to the world economy, this research from American Express and WTTC is an important addition to the conversation.
William Glenn
President , Global Corporate Payments and Business Travel American Express
Outline
Introduction................ 5 Key findings. 10 Trade Summary.. 21 Linkages summary..... 24 Data sources and methodology... 30
Introduction
The World Travel & Tourism Council (WTTC) has spearheaded global analysis of the economic importance of the sector for over 20 years. This research has established the contribution of Travel & Tourism on an ongoing basis to over 180 countries in absolute size, share of the economy, and growth. Around the world, WTTC research is referenced as the authoritative source of the role of Tourism in generating GDP, income, and employment. WTTC is now releasing new research on the role that Travel & Tourism plays in the world economy in comparison to other economic sectors. The results of these comparisons provide new perspectives on the relative significance of Travel & Tourism as well as some of its unique advantages in driving current and future global economic growth.
Introduction: Summary of Research Structure

This new WTTC research benchmarks Travel & Tourism against an assortment of other sectors for twenty countries and for each world region.
Regions
World Americas Europe Asia Pacific Middle East Africa
Countries
Australia Argentina Brazil Canada China France Germany India Indonesia Italy Jamaica Japan Republic of Korea Mexico Russia South Africa Turkey UAE United Kingdom USA
Introduction: Summary of Research Structure

The following metrics are analysed by sector for each country and region: GDP (size and share of economy) Employment contribution (size and share of economy) Historic growth Expected growth Export contribution Strength of linkages to the rest of the economy Job creation potential
Introduction: Sectors referenced The following sectors have been analysed in comparison to Travel & Tourism. They were selected as having a similar breadth and global presence as Travel & Tourism.
Mining: includes the extraction of oil, natural gas, coal, metals, and related services Education: includes all levels of educational services Chemicals manufacturing: includes drugs & medicines, plastics, rubber, paint, polishes, ink, perfumes, cosmetics, soap, cleaning materials, fertilizer, pesticides, other chemicals Automotive manufacturing: includes motor vehicles and parts & accessories Communications: includes post (national and private) and telecommunications Financial services: includes banking, investment services, insurance
Introduction: Levels of industry impacts
The analysis examines the economic value of industries on three levels.

Direct: this includes only those employees and the related value added for the relevant sector. In the case of Travel & Tourism, we only count the value added of the accommodation, recreation, transportation, and other related sectors. Indirect: this measures the supply chain impact (also called inter-industry linkages) for each sector. Induced: this measures the impacts of incomes earned directly and indirectly as they are spent in the local economy. The sum of direct, indirect, and induced impacts equals the total economic impact of a sector.
ACCOMMODATION
Key findings
Sponsored by:
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Key findings: Global Direct GDP ($)
At $2 trillion in 2011, Travel & Tourism direct industry GDP is larger than the automotive and chemicals manufacturing sectors. Travel & Tourism directly generates more than double the GDP of automotive manufacturing and is one-third larger than the global chemicals industry. Travel & Tourism is threequarters the size of the global education, communications, and mining sectors.
Global Direct GDP by Industry in 2011

$US billion (2011 prices) 5,000 4,500 4,000 3,500 3,000 2,500 2,000 1,500 1,000 500 -
Communication services
Automotive manufacturing
Manufacturing of chemicals
Travel & Tourism
Education
Mining
Financial services
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Key findings: Global Total GDP Contribution ($)
At $6.3 trillion in 2011, the GDP impact of Travel & Tourism is larger than that of some of the largest manufacturing sectors namely automotive and chemicals manufacturing. Travel & Tourisms total economic impact exceeds that of the mining sector and nearly equals that of the global education sector.
Global GDP Impact by Industry in 2011

$US billion (2011 prices) 14,000 12,000 10,000 8,000 6,000 4,000 2,000 0
Indirect + Induced Direct
Travel & Tourism
Mining
Education
Financial services
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Key findings: Global Total GDP Impact (share)
At 9.1% of global GDP, Travel & Tourism generates more economic output than automotive manufacturing (7.9%), mining (8.0%) and chemicals manufacturing (9.0%). Travel & Tourism contributes roughly the same share of global GDP as the global education and communications industries. Travel & Tourism generates about half what the global banking and financial services industry contributes.
Global GDP by Industry in 2011

Share of World Economy 20% 18% 16% 14% 12% 10% 8% 6% 4% 2% 0%
Travel & Tourism
Mining
Education
Financial services
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Key findings: Regional Direct GDP

Travel & Tourism directly contributes more to GDP than automotive manufacturing in every region of the world. In the Americas, Travel & Tourism GDP is 3 times larger than auto manufacturing. In Europe, Travel & Tourism GDP is twice the size of auto manufacturing. Travel & Tourism GDP is larger than the chemicals industry in every world region except Asia, where it is only 9% lower.
World Direct GDP for All Sectors

$US billion (2011 prices) 1,800 1,600
Travel & Tourism Automotive manufacturing Manufacturing of chemicals Communication services Financial services Mining Education
1,400 1,200 1,000 800
600 400 200 -
Asia Pacific
Americas
Europe
Middle East
Africa
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Key findings: Global Direct Employment

In terms of employment, the importance of Travel & Tourism is even more pronounced. With 98 million people directly employed in 2011, Travel & Tourism directly employs: 6 times more than automotive manufacturing 5 times more than the global chemicals industry 4 times more than the global mining industry 2 times more than the global communications industry A third more than the global financial services industry
World Travel & Tourism Council 15
Global Direct Employment by Industry

2011, millions 160 140 120 100 80 60 40 20 -
Financial services
Travel & Tourism
Mining
Education
Key findings: Global Total Employment

With a total impact of 8.7% of world employment, Travel & Tourism is one of the leading job creators in the world. Travel & Tourism sustained 255 million jobs in 2011. This exceeds to the jobs impact of auto manufacturing, chemicals manufacturing, and mining. It is nearly on par with education.
Global Employment by Industry

Share of global employment 12% 10% 8% 6% 4% 2% 0%
Communication services Automotive manufacturing Travel & Tourism Manufacturing of chemicals Mining Education Financial services
Global Employment by Industry

2011, millions 350 300 250 200 150 100 50 0
Travel & Tourism
Education
Financial services
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Mining
Key findings: Regional Manufacturing Employment

Travel & Tourism directly sustains more jobs than the automotive and chemicals manufacturing industries combined across every region of the world. Travel & Tourism employment in Europe - reaching 10 million in 2011 - exceeds auto manufacturing by a factor of 3. In Asia, there are 7 times as many Travel & Tourism jobs as auto manufacturing jobs and 5 times as many chemicals manufacturing jobs.
Direct Employment in 2011

'000s 40,000 35,000 30,000 25,000 20,000 15,000
63 mn
Travel & Tourism Automotive manufacturing Manufacturing of chemicals
10,000 5,000 -
Asia Pacific
Americas
Europe
Middle East
Africa
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Key findings: Regional Employment in other sectors
In every region of the world, Travel & Tourism directly sustains more jobs than the financial services, communications, and mining industries.
Direct Employment in 2011

'000s 70,000 60,000 50,000 40,000
Mining Travel & Tourism Financial services Communications
30,000 20,000 10,000 -
Asia Pacific
Americas
Europe
Middle East
Africa
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World GDP Growth
The Oxford Economics global industry model projects Travel & Tourism direct industry GDP to grow 4.2% per annum (compound annual growth) over the next decade. This is greater growth than forecast for the automotive, education, and mining sectors as well as the total global economy, which Oxford Economics expects to grow 3.6% per annum through 2022.
World GDP Forecast by Industry

CAGR 2012-2022 6% 5% 4% 3% 2% 1% 0%
Total economy
Travel & Tourism
Construction
Mining
Education
Financial services
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World Employment Growth
The Oxford Economics global industry model projects Travel & Tourism direct industry employment to grow 1.9% per annum (compound annual growth) over the next decade. This is greater growth than forecast for mining sector as well as the total global economy, which Oxford expects to grow 1.2% per annum through 2022.
World Employment Forecast by Industry

CAGR 2012-2022 4% 3% 2% 1%
0%
Travel & Tourism
Total economy
Mining
Education
Construction
-1% -2% -3%
Financial services
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Trade Summary
Sponsored by:
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Trade summary: Total Exports

Foreign visitor exports represent a substantial share of exports around the world, forming an essential component of global trade. Tourism generated 10% of all UAE exports (including oil) and 15% of Turkeys exports in 2011. In industrialised economies such as the UK, Australia, Italy, US, and France, Tourism still generated more than 5% of total exports last year.
Travel & Tourism share of total exports (2011)

Japan China Brazil Germany S Korea Russia Canada Mexico India Indonesia UK Australia Italy Argentina US France S Africa UAE Turkey Jamaica 0% 5% 10% 15%
49% -->
20%
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Trade summary: Service Exports

Visitor receipts represent a substantial share of national service exports around the world, generating foreign exchange and financial stability especially for emerging economies. For example, more than half of all service exports are generated by Travel & Tourism in the UAE, Jamaica, Turkey, South Africa, Mexico, and France. Between 25% and 50% of service exports are generated by Travel & Tourism in the US, China, Russia, Australia, Italy, Argentina, and Indonesia.
Travel & Tourism share of service exports (2011)

Japan India UK Brazil Germany Canada South US China Russia Australia Italy Argentina Indonesia France Mexico South Turkey Jamaica UAE 0% 20% 40%
Average = 26%
60%
80%
100%
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Linkages Summary
Sponsored by:
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Linkages: Travel & Tourism Outperforms the Economy

By analysing input-output data across all 20 countries, we have identified the linkages between Travel & Tourism and the rest of the economy. This identifies the ways in which the rest of the economy benefits from the injection of Tourism dollars. The adjacent chart compares the GDP multiplier for Tourism and the average of the entire economy. A multiplier of 2 implies that for every new dollar a total of 2 dollars is generated including indirect and induced impacts. In 18 out of the 20 economies analysed, a new dollar in Travel & Tourism generates more total economic output than the average new dollar in the economy.
Comparing T&T and total economy multipliers

Travel & Tourism
4.5 4.0
3.0 2.5
2.0 1.5 1.0 0.5 0.0 0.0
T&T outperforms the economy average
3.5
T&T underperforms against the economy average
0.5
1.0
1.5
2.0
2.5
3.0
3.5
4.0
Total Economy
Global average GDP multipliers Travel & Tourism: Total economy:

3.2 2.7
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Linkages: Travel & Tourism Outperforms the Economy

Travel & Tourism also outperforms the majority of the key sectors we analysed in terms of generating GDP across the entire economy. The industry multiplier measures the impact across the entire economy as a share of the direct industry impact alone. At 3.2, Travel & Tourisms broader impact per unit of direct GDP exceeds that of communications, financial services, education, agriculture, and mining. Only chemicals and auto manufacturing have higher multipliers across the 20 countries analysed.
World Average GDP Multipliers

Total GDP / Direct GDP 6.0
5.0 4.0 3.0 2.0 1.0 0.0
Travel & Tourism
Total economy
Manufacture of chemicals
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Mining
Education
Agriculture
Financial services
Linkages: Key findings

In terms of employment generation, we found Travel & Tourism to also be potent. The adjacent table illustrates the strength of a dollar of spending in Travel & Tourism versus a dollar of spending in the average of the national economy. As shown earlier, in 18 out of the 20 economies, a new dollar in Travel & Tourism generates more total economic output than the average across all other sectors. In terms of job creation, a dollar of spending in Travel & Tourism is more powerful than the average of the economy in 17 out of 20 countries. The only countries where this is not the case are ones in which agriculture remains a significant employer (China, India, Indonesia).
Performance against economy
Argentina Australia Brazil Canada China France Germany India Indonesia Italy Jamaica Japan Korea Mexico Russia South Africa Turkey UAE UK USA Cross-country
Legend: Greater than economy average Within 10% below economy average More than 10% below economy average
Output Jobs 1.1315942 1.0867687 1.3685288 1.5809815 1.0388657 1.0006292 1.712968 1.5050483 1.0829755 0.8902444 0.9280567 1.1316037 1.1464106 1.3758862 1.5561394 0.6787127 1.4448595 0.9398877 1.0692845 1.5290552 1.5412745 1.1752168 1.1475533 1.4511417 1.0928706 1.2838761 1.1962775 1.5728657 2.0457252 1.4023303 1.1191491 1.3325836 1.2260842 1.0258898 1.3516755 1.0042186 1.0644809 1.2229058 0.9589748 1.053587 1.0661999 1.3319932
1.06 1 0.91
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Linkages: Job creation

To illustrate this point further, we compared Travel & Tourism to six other sectors of the economy to determine the total job impact per $1 million in spending. This analysis calculates not only direct industry jobs, but also those generated through the supply chain and incomes. Travel & Tourism is one of the top two job creators with an average of 50 jobs generated per $1 million in spending across the 20 countries we analysed. $1 million in Travel & Tourism generates twice as many jobs as $1 million financial services, communications, and auto manufacturing.
Employment impact of $1m spending

Jobs 70 60 50 40 30 20
10 0
Chemicals
Automobile Manufacture
Communications
Education
Mining
Financal Services
Whole Economy
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Travel & Tourism
Linkages: Households and the local economy

Industries can also be evaluated on the basis of how spending flows to households and to other parts of the economy. The best sectors for economic development tend to be those that generate the most household income and retain the maximum share of expenditure within the local economy after accounting for imports. For every $1 million in Travel & Tourism spending, $701,000 in income is generated. This exceeds the income proportions for auto, communications, chemicals, and mining. In terms of money retained in the local economy, 91% of each dollar spent remains, while just 9% is leaked out as imports. This is better than the mining, chemicals, and auto manufacturing sectors.
Retained expenditure and income generation

Income ($000) from $1m spend
1,200
Household gains
Education
1,000
Financial Svcs
800
Auto Mauf
Travel & Tourism Communications
600
Chemicals
Agriculture Mining
400 Local economy gains 200 75% 80% 85% 90%
95%
100%
Share of expenditure retained
(Average of 20 Countries Analysed)
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Data Sources & Methodology
Sponsored by:
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Data sources and methodology: GDP and Employment

Main data sources for comparative sectors:
United Nations International Labour Organization OECD STAN STructural ANalysis Database Oxford Economics Global Industry Model CEIC Data Manager Statistical Institute of Jamaica UAE National Accounts
Travel & Tourism GDP and employment figures are drawn from Oxford Economics analysis for WTTC using the Tourism Satellite Account framework.
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Data sources and methodology: Exports

Main data sources:
OECD STAN World Trade Organization (WTO) UN COMTRADE IMFBOPA Oxford Economics.
Total exports, total service exports and total goods/merchandise exports are sourced originally to national accounts and central bank balance of payments data. Merchandise exports taken from OECD STAN where possible, and from UNCOMTRADE and WTO for Jamaica and UAE. Service exports taken from IMFBOPA database for all countries where possible. 2000 figures taken from above, 2011 estimated using 2010 shares of total and applied to totals for 2011.
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Data sources and methodology: Linkages

Main data sources: OECD, National Statistical Offices, Oxford Economics Input-output tables for all countries were sourced from either the OECD or, when not available, National Statistical Offices. From the input-output tables, multiplier matrices were developed for each economy, detailing the flow of spending in an economy that occurs as a consequence of spending in a given industry. For each of the comparator sectors, a spending shock of $1 million was simulated, with the resulting spending impacts in every industry in the economy recorded. These spending outcomes were translated into gross value added (GVA) using the GVA/output ratios available in the input-output tables, and employment, using productivity level data developed from the GDP and employment figures derived elsewhere in the study. Travel & Tourism multipliers are drawn from Oxford Economics / WTTC ongoing Tourism Satellite Account analysis. Global and regional multipliers were calculated as the weighted average of all relevant nations, with weightings assigned according to sector GDP.
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About WTTC and Oxford Economics
The World Travel & Tourism Council (WTTC) is the forum for business leaders in the Travel & Tourism industry. With Chief Executives of some one hundred of the world's leading Travel & Tourism companies as its Members, WTTC has a unique mandate and overview on all matters related to Travel & Tourism. WTTC works to raise awareness of Travel & Tourism as one of the world's largest industries, supporting 255 million jobs and generating 9 per cent of world GDP. WTTC advocates partnership between the public and private sectors, delivering results that match the needs of economies, local and regional authorities and local communities with those of business.
Oxford Economics is one of the worlds leading providers of economic analysis, forecasts and consulting advice. Founded in 1981 as a joint venture with Oxford Universitys business college, Oxford Economics enjoys a reputation for high quality, quantitative analysis and evidencebased advice. For this, its draws on its own staff of over 70 highly-experienced professional economists; a dedicated data analysis team; global modeling tools, and a range of partner institutions in Europe, the US and in the United Nations Project Link. Oxford Economics has offices in New York, Philadelphia, San Francisco, Chicago, London, Oxford, Belfast, Dubai, and Singapore.
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About American Express
American Express is a global services company, providing customers with access to products, insights and experiences that enrich lives and build business success. American Express Global Business Travel is a global industry leader in business travel and meetings management committed to helping businesses succeed through cost-effective program management, world-class customer service, and enhanced traveler productivity support worldwide. Through leading online, offline and on-the-go solutions, consulting services, business insights and research, supplier negotiation expertise, and meetings and events capabilities, innovative services are delivered to clients to maximize the return on their travel and meetings investments. American Express Corporate Payment Solutions provides the Corporate Card, Corporate Purchasing Solutions, and other expense management services to mid-size companies and large corporations worldwide. In the U.S., American Express is a leading issuer of commercial cards, serving more than 70% of the Fortune 500, as well as tens of thousands of mid-size companies.
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Benchmarking Travel & Tourism

Summary of Findings, April 2012

World Travel & Tourism Council

World Travel & Tourism Council

World Travel & Tourism Council

World Travel & Tourism Council

Introduction: Summary of Research Structure

World Travel & Tourism Council

Introduction: Summary of Research Structure

World Travel & Tourism Council

World Travel & Tourism Council

Introduction: Levels of industry impacts

The analysis examines the economic value of industries on three levels.

World Travel & Tourism Council

World Travel & Tourism Council

Key findings: Global Direct GDP ($)

Global Direct GDP by Industry in 2011

Travel & Tourism

World Travel & Tourism Council

Key findings: Global Total GDP Contribution ($)

Global GDP Impact by Industry in 2011

Travel & Tourism

World Travel & Tourism Council

Key findings: Global Total GDP Impact (share)

Global GDP by Industry in 2011

Indirect + Induced Direct

Travel & Tourism

World Travel & Tourism Council

Key findings: Regional Direct GDP

World Direct GDP for All Sectors

1,400 1,200 1,000 800

600 400 200 -

World Travel & Tourism Council

Key findings: Global Direct Employment

Global Direct Employment by Industry

Travel & Tourism

Key findings: Global Total Employment

Global Employment by Industry

Global Employment by Industry

Travel & Tourism

World Travel & Tourism Council

Key findings: Regional Manufacturing Employment

Direct Employment in 2011

World Travel & Tourism Council

Key findings: Regional Employment in other sectors

Direct Employment in 2011

30,000 20,000 10,000 -

World Travel & Tourism Council

World GDP Growth

World GDP Forecast by Industry

Travel & Tourism

World Travel & Tourism Council

World Employment Growth

World Employment Forecast by Industry

Travel & Tourism

-1% -2% -3%

World Travel & Tourism Council

World Travel & Tourism Council

Trade summary: Total Exports

Travel & Tourism share of total exports (2011)

World Travel & Tourism Council

Trade summary: Service Exports

Travel & Tourism share of service exports (2011)