Hoteliers Upbeat For 2018 But Warn Of Risks To Tourism Growth
Hotel and guesthouse owners are reporting a good start to the year according to an industry survey* undertaken by the Irish Hotels Federation (IHF) in advance of its 80th Annual Conference in the Slieve Russell Hotel, Co Cavan. Most are forecasting an increase in business levels for 2018 with advance bookings up from domestic and key overseas markets, helping to offset the drop in bookings from the UK, Ireland’s largest market, where visitor numbers continue to fall. The high cost of doing business, including insurance, continues to be a major concern.
Seven in ten (72%) hoteliers say their overall business levels are up compared to this time last year, with a similar number (68%) reporting an increase in advance bookings for the remainder of the year. Business levels from the US look set to remain strong with over half of hoteliers surveyed reporting an increase in business from this market. Visitor numbers are up too from continental Europe with almost a third (32%) reporting an increase in business from Germany and nearly a quarter (23%) seeing a rise from France. Closer to home the domestic market remains buoyant with almost seven in ten (67%) of hoteliers seeing an increase in home-grown business. However, in contrast, the UK market remains a significant concern with over half (56%) of hoteliers reporting a drop in business from Great Britain compared to this time last year and almost four in ten seeing a drop from Northern Ireland.
Joe Dolan, President of the Irish Hotels Federation said that overall hoteliers are confident about the outlook for 2018, but not complacent. “The increase in business levels that we are seeing from key international markets and from within Ireland itself, following on from strong growth in recent years, gives us some confidence. However, the negative effect on visitor numbers from the weakened sterling and uncertainty over Brexit reminds us that we’re an island nation, dependent on the vagaries of other, larger economies, and there is never room for complacency,” he said.
“We operate in a price sensitive sector where we compete with the UK for overseas visitors. A sustained fall in sterling could have a negative effect on visitor numbers from other markets who may opt instead to go to the UK. Cost-competitiveness is critical. Government cannot influence the economic conditions affecting other countries but there is a wide policy range of measures within their control that can enhance competitiveness. The 9% VAT rate and zero travel tax, for example, have been hugely significant in underpinning the recovery of the tourism sector. However, more needs to be done to bring down the high costs that are stifling business in Ireland such as insurance, where the costs are now so high they are a significant concern for almost nine in ten hoteliers (88%),” he said.
Mr Dolan added, “It is important that there is a continued commitment to enhancing and developing the experiences that we offer visitors - from at home and overseas. The hotel sector has an important role to play here and, as our member survey highlights, most hoteliers across the country are planning to invest in their properties this year – from expansion in some cases, to refurbishment, or investing in new technology to upgrade existing operational and guest services.
“But, it’s also about market diversification and reinvigorating our tourism brand, to create compelling offers that appeal to new markets while at the same time helping us to consolidate our market share in existing markets. More needs to be done, especially in regional tourism marketing. There are parts of the country like the Shannon Corridor, which have much to offer and with the right support they could expand Ireland’s tourism offering and greatly benefit the rural economy,” he added. According to the IHF survey, two thirds of hoteliers are already planning to increase their own marketing spend during 2018 in a bid to attract more visitors to their areas.
Employment growth within the hotel sector also looks set to continue in 2018. Over half of hoteliers (52%) expect to increase their staffing levels with opportunities available across all areas of business, from entry-level positions to jobs for experienced staff. The tourism industry is Ireland’s largest indigenous employer. It supports approximately 230,000 jobs - equivalent to 11% of total employment – with more than 60,000 of these jobs in the hotel sector alone. Employment in the tourism sector has grown by over 60,000 since 2011, an increase of 33%. This compares to an increase of 13% in employment throughout the overall economy.
Corporate meetings and events are a significant source of business for almost half (47%) of the hoteliers surveyed with more than four in ten (46%) of these reporting an increase in business year on year, another sign of the buoyant economy.
- Breakdown across markets compared to this time last year:
- Domestic market: 67% of hotels and guesthouses are reporting an increase in visitor numbers from across Ireland compared to this time last year with 25% seeing no change and 8% noting a decrease.
- Britain: Only 11% are noting an increase in visitor numbers from Britain, with 33% seeing no change, and 56% seeing a decrease.
- United States: 53% of premises are noting an increase, while 40% have seen no change and 7% noting a decrease.
- Germany: 32% of hotels and guesthouses are reporting an increase, with 62% saying they have seen no change and 6% seeing a decrease.
- France: 23% of hotels and guesthouses are noting an increase, with 70% saying they have seen no change and 7% seeing a decrease.