TOURISM VICTORIA

Economic Contribution of Tourism to Victoria 2007-2008

Tourism is a significant economic driver for Victoria. Tourism was estimated to be worth $15.8 billion to Victoria’s economy and employ approximately184,800 people in 2007-2008.

Sustainable Tourism Cooperative Research Centre (STCRC) has provided Tourism Victoria with an estimate of tourism’s economic contribution to Victoria for 2007-2008. This analysis provides an update of the STCRC estimates for 2006-07.

Tourism 's Direct and Indirect Contribution to Victoria's Gross State Product (GSP) 16.0 15.8 7.0%

15.8
Gross State Product (% of State total)
6.5%

The STCRC prepares Tourism Satellite Accounts (TSA) for each Australian state and territory that is reconciled to the National TSA produced by the Australian Bureau of Statistics (ABS). TSA are best estimates based on the internationally recognised and accepted methodology.

Gross State Product ($b)

15.6 15.4

6.0% 15.2 15.0 14.8 14.6 2006-2007
Gross State Product ($b)

15.1
5.5%

The TSA includes measures for the economic contribution of tourism to Gross Value Added (GVA), Gross State Product (GSP) and employment. It also provides information about tourism consumption and output regarding the composition of the tourism industry and its interaction with other industries.

5.0% 2007-2008
Gross State Product (%of State total)

GROSS STATE PRODUCT (GSP) Tourism directly contributes $8.6 billion to the Victorian economy and accounts for 3.2% of GSP. GROSS VALUE ADDED (GVA) Every conventional industry depends directly or indirectly upon spending by travellers, although the links may not immediately be apparent. The benefits of the tourism dollar are spread well beyond the hotel lobby, filtering through to the petrol pump, the corner store and even the local mechanic. This flow on is referred to as the indirect economic contribution of tourism. The true contribution of tourism to the Victorian economy is best measured by GVA. The Victorian tourism industry directly accounted for $7.2 billion, or 3.0% of total industry GVA for all industries in Victoria during 2007-2008.

Tourism indirectly contributes an additional $7.2 billion to the Victorian economy. Therefore, tourism is worth $15.8 billion in total or 5.9% of total Victorian GSP.

Accommodation had the largest share in tourism GVA (12.5%), followed by other retail trade (10.7%), air and water transport (9.6%), education (9.4%) and cafés, restaurants and food outlets (9.3%).

The Victorian tourism industry’s total (direct and indirect) contribution to the State economy has grown1 for Gross State Product (GSP) over the period 2006-07 and 2007-08.

Indirectly, tourism contributed an additional $6.8 billion to GVA in Victoria. Therefore, tourism is worth $14.0 billion in total or 5.8% of total Victorian GVA.

As highlighted in the following chart, tourism is currently worth $15.8 billion to Victoria’s economy, or 5.9% of total Victorian GSP. This represents a 4.4% increase from $15.1 billion, however a slight decline in share from 6.1% in 2006-07.

Gross Value Added (GVA) has grown over the period 2006-07 and 2007-08.

1 The model for each period used slightly different statistical techniques and therefore there are some small analytical limitations in comparing 2006-07 and 2007-08.

As highlighted in the chart below, tourism is currently worth $14.0 billion in GVA, or 5.8% of total Victorian GVA. This represents a 4.4% increase from $13.4 billion, with share remaining at 5.8%.

As highlighted in the following chart.3% 22.2 13.6 % Cafés and rest aurant s.0% of total employment in the state.5% 5.0 14.1% increase from 179.4% 2006-07 2007-08 Victoria's Share of the Australian Tourism Industry Tourism Gross Value Added ($m) Tourism Gross State Product ($m) Educat ion. Restaurant . tourism consumption directly generated approximately 105.0% 4.1% of employment in Victoria.TOURISM VICTORIA Economic Contribution of Tourism to Victoria 2007-2008 Tourism 's Direct and Indirect Contribution to Victoria's Gross Value Added (GVA) 14. 4.9 13.5% 6.3% 22.St Kilda .0% in 2006-07. 8.0% 5.5% TOURISM AND EMPLOYMENT In 2007-2008.6%) and cafes and restaurants (10.5% 4.3 13.2%) accounted for the largest share of direct tourism employment.1%) was higher than tourism’s share of industry GVA (5.1% Accommo dation.2% Victoria’s share of the Australian Tourism Industry has remained steady for the period 2006-2007 to 2007-08.1 2006-2007 Gross Value Added ($b) Looking at the distribution of tourism jobs across Victorian industries.4 13.3% 13. Gross Value Added (% of State total) Gross Value Added ($b) 13.2 % 22.1% Tourism indirectly contributes an additional 79. pub s.7 13.2% Road transport and moto r vehicle hiring.300 jobs in Victoria or 4.800 in total.500 jobs to the Victorian economy. followed by accommodation (12.1% 22.2%). This was an 3. Direct Contribution to Em ploym ent 2007-2008 Clubs.0 6. 9.0% 2007-2008 Gross Value Added (%of St at e t ot al) Retail trade.4 5. the number of persons employed in the Victorian tourism industry in 2007-08 was 184.1 7. Tourism’s share of total employment (7. or 7. Air and wat er t averns and bars.0% 14.800 jobs in total or 7. M anuf act uring. 12.200 jobs and 7. 5. 10. Therefore tourism creates approximately 184. the retail trade (24.8 13.1% of total employment in Victoria. 24.5 13. t ransport.8%) because tourism is more labour intensive than many other industries.6 13.

Tourism Research Australia. Victoria’s share of Australian tourism employment remained steady at 21. . unlike traditional supply side industries. but it is only when the purchaser is travelling.5% Employment (000s) 182 181 180 179 6.5% 178 177 176 2006-2007 Employment (000s) 7. does that spending become part of the tourism industry. In Australia. November 2009.1% 2007-2008. Victoria's Tourism Jobs (direct & indirect) 186 185 184 8.australia. away from his/her normal residential area.0% Employment (% of State total) 183 Tourism is actually a demand-oriented concept. “Tourism within States and Territories”. DEFINITIONS The Tourism Industry: Tourism is an unconventional industry. 20072008 which can be found at: http://www.0% 2007-2008 Employment (%of State tot al) A tourist or visitor is defined as any person travelling for business or leisure. Tourism’s contribution to the Australian Economy 1997-98 to 2007-08. education or restaurant services.pdf Victorian tourism Gross Value Added (GVA) measures the value of tourism gross output at basic prices by all industries which supply tourism products.crctourism. Sustainable Tourism Cooperative Research Centre. Sustainable Tourism Cooperative Research Centre. less the value of the inputs used in producing these tourism products. that is. Sources: “Tourism within States and Territories”. attend a conference or buy a meal. Anyone can buy a t-shirt. using Australian Bureau of Statistics (ABS) and Tourism Research Australia (TRA) definitions. November 2008.TOURISM VICTORIA Economic Contribution of Tourism to Victoria 2007-2008 according to the types of goods or services they sell. such as textiles. a tank of petrol. but not people travelling as part of a permanent migration or regular commuting.com/content/documents/Economic% 20Analysis/Tourism%20Business/Tourisms_contribution_199 7-98%20to%202007-08_FINAL.8 7. “Tourism Satellite Account 2006-07: Victoria”. after subtracting the cost of production.0% 184. http://www. Direct tourism GVA is directly comparable with the GVA of ‘conventional’ industries such as agriculture and manufacturing and should be used for comparison purposes.au/BookShop/BookDetail. a domestic tourist is a person travelling at least 40km each way overnight or at least 25km each way on a day trip.2 Therefore. it’s the status of the purchaser of the goods and services (rather than the producer) that defines a tourism transaction.aspx?d =684 Victorian tourism Gross State Product (GSP) represents the total market value (taxes less subsides) of goods and services used in Victoria.com. 179. 6. petroleum.tra. Canberra is another useful reference. Industries are conventionally defined on the supply side. MORE INFORMATION For more detail on the methodology and results please refer to the full report.

TOURISM VICTORIA Economic Contribution of Tourism to Victoria 2007-2008 Updated by Tourism Victoria. November 2009 .