CHAPTER 4:

CURRENT TRENDS AND

ISSUES IN THE TOURISM
AND HOSPITALITY
INDUSTRY
REPORT BY: LOVELY LONTIONG
 The Bright Future of Tourism and Hospitality
In recent years , a number of significant social and economic changes have
occurred that suggest bright future for the tourism and hospitality industry.

1. Early Retirement
At present, many workers retire at an early age than the case in
previous years. The US social security system provides benefits to workers as
young as 62 years of age and many employee retirement programs are based
on years of service rather than on age.
2. Longer life span
The average individual can now expect to live beyond the age of 70 and
many will live longer. This is in contrast to earlier generations when the average life
span was much less increasing population of older, retired citizens who are richer due
to pension programs and the healthier provides a larger base of potential customers for
tourism and hospitality operations.
3. Shorter workweek
In the past , the six-day workweek was the standard for most working
people. At present, the five-day workweek is standard and the four-day workweek is
becoming common—leaving several days for other activities. The resulting increase in
leisure time, combined with faster and easier transportation, makes possible for many
individuals to take weekend vacations and travel to a degree they could not have made
few years ago. The tourism and hospitality industry will surely benefit from this
increase in travel;
4. Greater disposable income
The average family has more money to spend than before. This is due to
higher wages and two earner households. A large portion of the additional
disposable income is spent on consumer goods and services. The tourism and
hospitality operation
receive an important share of it;
5. Greater mobility
Improved roads and better transportation make it easier to travel every
year. The modern highway system has reduce the time required for automobile
travel between any two points. New planes use new technologies which enable
them to carry more passengers while using less fuel. These increases the travel
have a positive impact on tourism and hospitality industry sales;
6. Smaller families
The average family size has decreased. Thus, it is easier for the family
to travel and travel costs less if few family members travel.

Issues in Tourism and Hospitality

Although the future of the tourism and hospitality industry is bright, it
is not without problems. Others are emerging issues brought by social, economic,
and technological change.
These issues can be categorized under the following headings:
1. Marketing;
2. Legal;
3. Human resources;
4. Operations; and
5. Consumer affairs;

Marketing Issues
The marketing issues are changing
demographics, changing vacation
patterns, market segmentation,
frequent guests programs,
maturation in segments of the fast-
food industry, and consolidation.
 Changing Demographics
- The population of developed countries is
aging. The median is now 33 years and
projected to increase in the coming years.
Another changing demographic
characteristic is the increase in the number
of single-parent households. Single parent
households generally have lower levels of
decretionary income.
 A third demographic change is the continuing growth in the number of
people traveling for personal rather than for business purposes.

The fourth demographic change is the growth in the number of

international travelers. One of the primary reasons is the decreased cost of
transportation relative to income, making travel more affordable to everyone. Another is
increased vacation time and a greater number of holidays in many countries.

 Changing Vacation Patterns

Citizens of industrialized countries are changing their vacation patterns. The
traditional once-a-year vacation of two weeks is declining in popularity. For a growing
number of people, vacations are becoming shorter and more frequent.
 Market Segmentation
Since 1980, the principal term in tourism marketing has been
marketing segmentation. Until the late 1970’s, lodging establishments
attempted to appeal to broad general markets.
Some of the lodge properties to become apparent include;
• All-suite properties
• Residence properties
• Sub-budget properties;and
• Variety of budget properties

 Frequent Guest Programs

Modeled on the frequent-flyer programs which were succesfully
used by many airline companies, these plans give credits to regular guest.
Many believe that these programs will gain in the lodging business the same
favor they have achieved among airline customers.
 Maturation in Segments of the Fast-Food Industry
Segments of the fast-food industry are no longer expanding to the extent that was
formerly possible. The demand for hamburger is not growing as fast as it once did, so
operators find it necessary to develop new products to maintain the desired sales level. As
public tastes continue to change,
food service operators will have to develop specialty products to retain an adequate share of
the market.

 Consolidation in the Commercial Lodging Industry

Some experts are now predicting that the number of large nation wide lodging
companies will decrease in the coming years; that a small number of firms will dominate the
lodging industry by acquiring smaller chains in regional or national properties, This will
enable successful companies to obtain the funds required to expand their operations
internationally.
 The trend toward consolidation will have a
tremendous impact on all commercial lodging operations.
Both independent operation and owners of smaller chains
will find it difficult to compete with heavily advertised
national and international brands.
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