ATEC Voice: Progress and challenges in recovery of inbound holidaymaker market

Australia’s tourism industry has shown remarkable resilience in the face of the significant challenges of the past few years. As the last industry to get back to business after the pandemic, export tourism operators are still rebuilding, with inbound holidaymaker numbers remaining around 80 percent of 2019 figures.

As we progress through 2024, the recovery of the inbound holidaymaker market must be a key focus, not just for ATEC but for the entire nation.

In 2019, international visitors spent a total of $16.7 billion on their holidays to Australia. Adjusted for inflation, the Reserve Bank of Australia says that figure would be closer to $20 billion in today’s terms. By comparison, the $13.72 billion spent in the past year highlights that, while we are making significant strides, we have not yet returned to prepandemic levels in spending.

The gap between these figures underlines the fact that, despite the encouraging recovery, the yield from international tourism remains considerably down from where we were in 2019. It tells us there is a broader economic landscape to consider, and ongoing efforts are needed to bring our industry fully back to its peak.

Visitor volume also continues to sit at around 80 percent of 2019 levels. This reduction directly impacts total expenditure, with fewer tourists naturally leading to lower overall spending. In 2019, the growth expectation for inbound holidaymaker numbers was around five percent a year, which would have seen almost 9 million international holidaymakers visiting our shores in 2024. These unrealised numbers represent millions in lost revenue, not just in direct tourism spend but through the ripple effect across the broader economy. The gap between where we are and where we could have been underscores the pressing need for strategic efforts to reclaim lost ground and propel the industry toward a robust and sustainable recovery.

The decrease in visitor volume is not just a matter of numbers; it affects the broader tourism ecosystem, including accommodation providers, tours, attractions, and tourism activities and experiences across the country. The reduced yield highlights the challenges we face in attracting more international visitors, especially in a highly competitive global

Recovery of the inbound holidaymaker market must be a key focus, not just for ATEC but for the entire nation tourism market where every destination is vying for highvalue international tourists.

Several factors have contributed to the current state of the market. Global economic conditions, including fluctuating exchange rates and inflation, have significantly shaped travel decisions. Additionally, changes in traveller behaviour have led to more cautious spending and shorter stays. The role of government and industry in supporting the recovery cannot be overstated. Government support through marketing campaigns and favourable visa conditions will be crucial in encouraging international tourists to choose Australia.

Looking ahead, there are both opportunities and challenges on the horizon. While we are optimistic about the continued recovery of the inbound holidaymaker market, it’s clear that we must remain vigilant and adaptable to the evolving global environment. Targeting emerging markets, promoting Australia’s distinctive experiences, and continuing to innovate in our approach to tourism marketing will be essential for driving growth.

While Australia’s tourism industry has demonstrated its resilience, and the progress we’ve made is significant, we’re not yet back in the black. Continued effort and collaboration will be needed to see our industry fully recover and, hopefully, position us as an even more competitive player in the global tourism market. The journey ahead may be challenging, but the potential for growth and success is certain.

By Peter Shelley, Managing Director, Australian Tourism Export Council