Business confidence grows but future remains a concern

Tourism New Zealand’s latest industry survey asked over 650 tourism businesses what their outlook was for the next 6-12 months, including measuring employment and how they’re evolving to the challenges facing the sector as a result of COVID-19.

“It’s encouraging to see that operators are using this time to improve their digital expertise, their people and their product, including using the assistance on offer through services like Qualmark” says Tourism New Zealand Chief Executive Stephen England-Hall.

However, despite Kiwis getting out and exploring all New Zealand, it won’t be enough to offset the loss of international spend – an estimated $12.9B gap according to new research. 

“With over 80% of respondents being small businesses the impact of this loss will be felt in communities across New Zealand over the coming months”

Employment

Employment over winter was down almost 10% but is improving and is less than the previous survey indicated.

Employment over the summer is set to remain flat against current levels but is still down 39% from summer 2019/20.  Interestingly, small businesses expect to hire more staff over summer, suggesting their smaller size is allowing them to adapt quicker to the changing situation.

How operators are evolving

It’s a challenging environment to operate in, but they’re trying to find new ways to either pivot or maintain the capacity to start up again once it’s possible.

30% of respondents said they are focusing on the domestic market at least short term, including returning expats.

Many have identified a current lack of digital expertise and are working fast to address it through support available through the Qualmark Tourism Advisory Support Service or other offerings such as the Regional Business Partner network, and are developing new or existing product.

Overall outlook

Business confidence has been low but is improving on the last survey results. As expected, the six-month outlook is poor with some optimism for the 12-month outlook. This shows that despite the increase in domestic tourism (and business reorientation) businesses are still concerned in the wake of COVID-19 and border restrictions.

The poor six-month outlook reflects the importance of summer months to businesses, a time when international visitors and spend are at their highest.

The information was collected by Tourism New Zealand to inform its activity and shared with other key stakeholders and decision makers.