Month: September 2020

Tourism HR Canada is delighted to share a recording of its latest webinar, Growth, Interrupted: Navigating COVID’s shock to Canada’s tourism workforce.

President and CEO Philip Mondor leads this one-hour presentation, sharing insights into the ongoing impact of COVID-19 on the tourism workforce.

In early 2020, Canada was on track to employ 2.2 million people in its tourism sector. Where are we six months into the COVID crisis? And what is the outlook as peak tourist season comes to a close?

With a focus on labour-related challenges and opportunities key to the return of a strong and resilient tourism economy, explore the customized, reliable labour data essential for making informed decisions on a pillar of Canada’s economy.

Participants will gain access to the latest labour market intelligence, as well as actionable advice on how to apply the content most relevant to their recovery needs.

Watch the recording of the webinar here.

Download the PowerPoint deck here.

Visit our Employment Tracker here.

Access our Tourism Workforce Recovery Toolkit here.

Tourism HR Canada is encouraged by the support measures outlined in the Speech from the Throne delivered yesterday by Governor General Julie Payette on behalf of the government. The hard-hit tourism, hospitality, and cultural industries were singled out for initiatives to assist their recovery efforts as restrictions to keep Canadians safe remain in place.

Commitments to investing in tools for hiring, retention, and training will help employers and employees navigate the decrease in demand, particularly as many regions’ peak tourist season comes to a close:

  • Extension of the Canada Emergency Wage Subsidy (CEWS) to the summer of 2021
  • Expansion of the Canada Emergency Business Account (CEBA)
  • Improvements to the Business Credit Availability Program (BCAP)
  • Largest investment in Canadian history in training for workers

Tourism HR Canada acknowledges the incredible work of the Coalition of Hardest Hit Businesses, who shone a light on the severe impact of COVID-19 on tourism, hospitality, and cultural businesses.

As noted in today’s release of COVID-19 Impact on Tourism Sector Employment and Revenues, we expect tourism employment for 2020 will have dropped by over 500,000 jobs from last year. Tourism employment is not expected to return to 2019 levels until 2023; the accommodation industry is projected to take a further year to recover. International tourism is not expected to fully recover until 2024 or 2025.

Read the full Speech from the Throne here.


Reactions from our national tourism partners:

Tourism Industry Association of Canada (TIAC): Speech from Throne Delivers Major Wins for Tourism Sector

Hotel Association of Canada (HAC): Government Gets It Right: Canada’s Hotel Sector Applauds Speech From The Throne

Restaurants Canada: Federal government commits to act on Restaurants Canada recommendation to extend wage subsidy

 

Since COVID-19 struck Canada’s tourism sector, tourist activity has plunged to unimagined levels. During the summer, the highest weekly average occupancy rate for hotels in Canada only reached 42.9%[1]. Passengers on major Canadian airlines for the month of June reached 440,000, which was 6.7 million fewer passengers than the same month a year prior[2]. And with the border closed, the number of tourists coming to Canada collapsed from millions of individuals per month in the summer of 2019, to 67,787 this July[3].

The outlook for tourism is dire. Economic projections by groups such as Destination Canada expect that if the borders stay closed until 2021, total tourism demand (which includes both international and domestic tourism) will decrease at least 43% and perhaps as much as 61%[4]. The International Air Transport Association (IATA) now estimates that global passenger traffic will not return to pre-COVID levels until 2024[5].

Tourism HR Canada wanted to understand the impact this would have on employment, considering not only demand from tourists, but also the local spending component. To do this, we worked with the Conference Board of Canada to adapt its tourism labour supply and demand model to project tourism employment levels to 2025, with quarterly employment estimates for 2020 and 2021.

The projections used the latest Provincial-Territorial Human Resource Module data from Statistics Canada from 2018, supplemented with labour force survey data, to show that there were approximately 1.88 million full-year jobs in Canada’s tourism sector in 2019.[6]

The employment outlook was driven by assumptions regarding general economic indicators and specific levels of demand for tourism products and services from domestic tourists, international tourists, and non-tourism demand (locals). Local demand is included because many tourism businesses (restaurants, golf courses, and other recreation activities) sell their goods and services to local residents who are not tourists. In addition, assumptions were made about the ratio between revenues and employment based on the trends seen to date. In the immediate term, we know that employment has not declined as far as revenues have. This is due to businesses cutting into profit margins, taking on debt, or utilizing government subsidies to maintain staff until the revenue outlook improves. Over time it is expected that revenues and employment will return to equilibrium as government subsidies are removed and tourism businesses adapt their workforce requirements to the post-COVID reality.

For 2020, it is estimated that non-tourism demand will decrease 29.2%, domestic tourism demand will decrease 49.0%, and international tourism demand will fall 76.0% (all compared to 2019). Spending within the tourism sector from all three sources will remain depressed in 2021 and 2022. Non-tourism demand and domestic tourism demand are expected to recover to 2019 levels in 2023, while it will take until 2025 for international tourism demand to fully recover to its pre-COVID level.

Table 1: Predicted Demand for Tourism Products and Services, Compared to 2019

Domestic

Tourism

International

Tourism

Non-Tourism

Demand

2020 -49.0% -76.0% -29.2%
2021 -19.1% -23.0% -12.0%
2022 -4.0% -15.0% -2.0%

Source: The Conference Board of Canada.

The impact on employment will be significant. The number of full-year tourism jobs is expected to be 27.3% lower in 2020 than it was in 2019. The most severely impacted industries are travel services (-33.3%), recreation and entertainment (-31.5%), and accommodation (-31.4%). Employment in Canada’s tourism sector will not return to 2019 levels until the year 2023. The accommodation industry will not return to 2019 employment levels until 2024.

Looking at the shorter term, tourism sector employment dropped in the first quarter of 2020 due to job losses in March and then dropped precipitously in the second quarter as the full force of shutdowns took effect. Employment recovered in the third quarter (July, August, September) due to the easing of shutdowns. However, employment is expected to decrease again in the fourth quarter as seasonal demand, which is highest in the summer, tapers off. It will rebound once again in the first quarter of 2021 on expectations of easing of restrictions on international travel and general economic recovery. Growth in employment will continue through to the third quarter of 2021, followed by another seasonal reduction in the fourth quarter.

Impact on Employment by Province/Territories

In 2020, the loss of full-year jobs relative to 2019 is expected to range from a loss of 32.7% in the territories to 26.5% in Manitoba. The employment recovery picture is similar across most provinces, equalling or slightly exceeding the number of 2019 full-year jobs by 2023, with the exception of New Brunswick, which is not expected to fully recover until 2024, and Newfoundland and Labrador, which will see employment levels below those of 2019 until 2025.

Impact on Revenue in Tourism Industries

The impact on revenues in tourism industries is also severe. Overall, revenue from all sources is expected to decline by 47.1% in 2020. The effect will be particularly felt in travel services, air transportation, and rail transportation, although all tourism industries will lose close to half of their revenue this year.

Table 2: Tourism and Associated Non-Tourism Demand in Canada ($2019 millions)

  2019 2020 2021
Transportation* 113,590 63,787 100,346
     Air transportation 27,470 11,987 23,484
     Rail transportation 443 195 382
     Other transportation 85,677 51,605 76,481
Accommodation 17,400 7,320 14,871
Food and beverage services 80,742 43,958 68,813
Recreation and entertainment 23,371 12,948 19,781
Travel services 4,916 1,538 4,151
Other (Non-tourism industries) 21,187 8,579 16,839
TOTAL DEMAND* 261,206 138,131 224,801

Revenues will remain well below 2019 levels in 2021, down 13.9% overall, and are not expected to recover to 2019 levels until 2023. For those industries that are most reliant on international tourists, the wait is even longer.

Tourism revenues have plummeted, as has employment in tourism industries, but not in a one-to-one ratio. Employment has held up better than revenues would suggest. Partially, this is because many tourism businesses also sell their goods and services to local residents. Partially, it is because businesses are willing to dip into their profit margins and credit lines in order to remain active while operating at a loss, to keep staff out of loyalty and to avoid needing to rehire staff when conditions improve. And partially, it is because government subsidies like the Canadian Emergency Wage Subsidy (CEWS) make keeping staff under these conditions more tenable, even when the business is operating on thinner margins, or even at a loss. At any given business, a different combination of these factors is at play.

Despite this, the loss of employment was severe. When businesses were fully shut down in March and April, over 880,000 individuals employed in tourism lost their jobs, a loss of 43.3% from February. Since May, employment has climbed, but in July and August—the height of the summer season—the number of people employed in the tourism sector was 557,200 and 463,500 fewer than in July and August of 2019, respectively.

Pre-COVID employment levels will not return until 2023—and that assumes no further shutdowns on the level seen in March and April occur. It is also important to remember that the number of workers in tourism had been growing steadily and, prior to COVID, was expected to continue to do so. The last pre-COVID labour supply and demand outlook produced by the Conference Board of Canada had estimated that the supply of workers would be able to fill 1,934,521 full-year jobs in 2023, 44,600 more jobs than expected after the effect of COVID-19[7]. Over the next few years, the labour force will continue to grow as young people—who make up 31% of the tourism workforce—enter the labour market. Under the current outlook, many of the first jobs that tourism provides will not be available.

Download the full report, COVID-19 Impact on Tourism Sector Employment and Revenues, here.


[1] STR: Canada hotel results for week ending 22 August, https://str.com/press-release/str-canada-hotel-results-week-ending-22-august

[2] Statistics Canada. Table 23-10-0079-01 Operating and financial statistics for major Canadian airlines, monthly

[3] Statistics Canada. Table 24-10-0043-01 International tourists entering or returning to Canada, by province of entry

[4] Destination Canada, Visitor Demand Forecast (July 2020 Update), https://www.destinationcanada.com/en/coronavirus-updates/covid-19-research

[5] https://www.iata.org/en/pressroom/pr/2020-07-28-02/

[6] For the purpose of this study, a job is defined as regular work for the period of one year. If the work only exists for a fraction of the year (e.g, 3 months or ¼ of a year), it only counts as the corresponding fraction of a job. This causes a difference between jobs number reported here and the labour force survey data which counts the number of individuals working in tourism at any given time. While there were 1.88 million full-year jobs in tourism in 2019, the labour force survey shows that prior to COVID-19 about 2.2 million Canadians were employed in the tourism sector.

[7] The Future of Canada’s Tourism Sector: Bottom Line, Growth Aspirations Face Labour Challenges

Future Skills Framework LogoTourism HR Canada is continuing to work with experts from across Canada to build the Future Skills Framework: a comprehensive set of competencies for our sector. To make sure these reflect today’s tourism workplaces, we’ve held dozens of consultation sessions with professionals with a wide range of tourism-related experience.

We are currently looking for anyone from the tourism industry with recent cooking experience to join a set of upcoming online sessions, to be held in October.

Joining a session offers a unique opportunity to contribute to the standard for your field, while working together with fellow experts from across Canada.

If you would like to join, please contact info@tourismhr.ca for more information.

Joe Baker, Tourism HR Canada Board member and OTEC Strategic Advisor, features in the latest FoodGrads podcast, Building a future-forward tourism industry workforce.

FoodGrads is an interactive platform for the food and beverage industry, focused on closing the gap between students/recent graduates and employers in food service and food processing.

Joe shares insights into pursuing a career in the food and beverage services industry, including what opportunities are available during the COVID-19 pandemic and how it could be a catalyst for positive change. His passion for creating a resilient and inclusive tourism workforce shine through, and shares actionable tips on getting into the industry.

Listen to Building a future-forward tourism industry workforce here.

Join Tourism HR Canada President and CEO Philip Mondor for this free one-hour webinar sharing insights into the ongoing impact of COVID-19 on the tourism workforce.

In early 2020, Canada was on track to employ 2.2 million people in its tourism sector. Where are we six months into the COVID crisis? And what is the outlook as peak tourist season comes to a close?

With a focus on labour-related challenges and opportunities key to the return of a strong and resilient tourism economy, this webinar will explore the customized, reliable labour data essential for making informed decisions on a pillar of Canada’s economy.

Participants will gain access to the latest labour market intelligence, as well as actionable advice on how to apply the content most relevant to their recovery needs.

Click here to register.

In August, tourism employment increased by 54,300 jobs, the smallest monthly gain since tourism employment began to recover in May.

Tourism employment dropped by 881,700 jobs through March and April. The sector has now gained back 572,200 of those lost jobs. But summer is the height of Canada’s tourism season, and on a year-over-year basis tourism employed 463,400 fewer individuals than it did in August 2019.

Highlights:

  • Tourism added 54,300 jobs in August — one quarter of Canada’s seasonally unadjusted job growth.
  • Ontario was responsible for the majority of employment growth, adding 41,300 jobs.
  • The tourism unemployment rate has fallen to 17.1%, which remains 6.1 percentage points higher than the overall unemployment rate.
  • On a year-over-year basis, seasonally unadjusted employment across all Canadian industries was down 5.3% from August 2019. In comparison, tourism employment was down 21.2% from the same month a year ago.

Please note: To allow comparisons with tourism sector data, which sees significant employment fluctuations over the year, we use seasonally unadjusted data for both tourism employment and overall employment.

Tourism Employment Rate

In the tourism sector, the seasonally unadjusted labour force survey data shows that the number of employed individuals grew by 54,300—an increase of 3.2%. Most of the added employment occurred in Ontario, which added 41,300 jobs, 76.1% of the total employment gain. This was driven by the reopening of businesses in the Greater Toronto Area and Peel region, which did not enter Stage 3 of Ontario’s reopening plan until the end of July.

Over four months of increases, tourism has gained 572,200 jobs. However, tourism employment is still below pre-COVID levels and well below the level of employment seen in August 2019. Employment levels were 15.2% below February 2020 and 21.2% lower than August 2019.

Last August, tourism employed over 2.2 million Canadians. This August, just over 1.7 million Canadians worked in the tourism sector.

In August, employment (unadjusted for seasonality) across the entire Canadian economy increased by 219,900 jobs. The increase in tourism employment accounted for 24.7% of that overall increase.

Despite overall employment increases, the travel services and transportation industry groups lost employment in August. Travel services lost 2,500 jobs and the transportation industry lost 4,800 jobs. In the case of transportation, this was the second straight month of losses. The food and beverage services industry gained 34,900 jobs, followed by accommodation (a gain of 18,700) and recreation and entertainment (8,000 jobs added). As a percentage of July’s employment levels, the accommodation industry had the strongest gains, as the additional 18,700 jobs represented an increase of 13.6% compared to July.

Overall, 78.8% of August’s employment gains were full-time jobs. However, the recreation and entertainment industry lost 2,100 full-time jobs while gaining 10,100 part-time jobs. The food and beverage services industry, on the other hand, gained 36,000 full-time jobs and lost 1,100 part-time jobs.

Because the industry groups that make up tourism are different sizes, looking at the monthly change in employment as a percentage change relative to the previous month provides a more equitable picture of how each industry is doing. It also helps illustrate the size of the employment increases, relative to the employment decreases that occurred in past months.

Employment in all industry groups remains below pre-COVID levels. This is despite four months in which overall tourism employment increased. As tourism employment usually begins to drop in the fall, it is likely that the coming months will see a return of employment losses. Employment in the recreation and entertainment industry is only 1.8% below February levels and employment in the accommodation industry is only 6.5% below February levels. However, the situation in the other three tourism industry groups is more dire. Employment in the travel services industry group is still down 42.8% and employment in transportation is 31.9% lower than February. Employment in the food and beverage services industry is 15.1% lower than it was before the COVID-19 shutdowns.

July and August are a peak time in demand and employment for the tourism sector. Therefore, it is important to compare year-over-year employment, as March is usually a low point for tourism employment. Starting in April, jobs are steadily added until a July or August peak. Under normal circumstances, tourism employment drops again as the summer tourism season ends.

On a year-over-year basis, seasonally unadjusted employment across all Canadian industries was down 5.3% from August 2019. In comparison, tourism employment was down 21.2% from the same month a year ago, although it is an improvement over July, when tourism employment was down 25.0% from the same month a year earlier. By industry group, year-over-year employment losses in June ranged from -35.0% in travel services to -16.5% in food and beverage services.

Ontario was the main source of additional employment in August, adding 41,300 jobs. Although sub-provincial tourism employment data is not available, it is likely that the Greater Toronto Area and Peel are responsible for the increase. Those regions did not reach Stage 3 of Ontario’s reopening plan until the end of July. Thus, businesses reopening in those regions are the main drivers of the overall employment trend in August.

The normal employment trend in August is a small increase—or even a decrease—in employment compared to July. Outside of Ontario, the employment trend followed this historical pattern. For example, British Columbia gained 5,800 tourism jobs, while Quebec shed 1,000 tourism jobs and New Brunswick lost 500 tourism jobs. All other provinces recorded small gains.

Compared to last year, employment in all provinces remained well below last summer’s levels. In August, Manitoba and British Columbia were closest to last summer’s employment levels being “only” 10.6% and 11.9% below the employment levels of August 2019. Despite employment gains, Prince Edward Island, Ontario, and Saskatchewan remained the farthest from last summer’s employment levels for the second month in a row.

Tourism Unemployment Rate

The overall and tourism unemployment rates decreased in August. Tourism unemployment fell slightly to 17.1% from 18.7% in July. By industry, the unemployment rate was highest in travel services, at 27.2%.

In August 2020, the unemployment rate in the tourism sector was at 17.1%, which is 12.2 percentage points higher than the rate reported in August 2019, and lower than the previous month (July 2020) when the unemployment rate stood at 18.7%.

At 17.1%, tourism’s unemployment rate was above Canada’s seasonally unadjusted unemployment rate of 11.0%.

The unemployment rate dropped in four of the five industry groups that make up the tourism sector, while it rose in the transportation industry.

Unemployment Rate
Tourism Industry Group[1]

August 2019

July 2020

August 2020

Tourism 4.9% 18.7% 17.1%
Accommodations 5.1% 25.7% 21.3%
Food & Beverage Services 5.3% 17.0% 16.2%
Recreation & Entertainment 4.6% 20.6% 18.1%
Transportation 5.3% 14.6% 15.0%
Travel Services N/A 27.2% 21.7%

On a provincial basis, tourism unemployment rates ranged from 8.1% in Newfoundland and Labrador to 18.6% in Ontario.

The seasonally unadjusted unemployment rates for tourism in each province, with the exception of Newfoundland and Labrador, New Brunswick, and Manitoba, were above the rates reported for the provincial economy.

Total Actual Hours Worked by Sector

Much like July, the number of actual hours worked in August decreased in many sectors, due to summer vacations. The significant drop in hours worked in the education sector is due to the closure of schools for summer. The number of actual hours worked in tourism-related sectors continued to increase. In August, the number of actual hours worked increased by 12.5% in the accommodation and food services sector, but decreased slightly—by 0.1%—in the information, culture and recreation sector. Accommodation and food services employees worked 26.5 million hours, fewer than the 31 million hours they worked in February and almost 10 million hours fewer than the 36.1 million hours worked in August 2019.

Workers in the information, culture and recreation sector worked 26.6 million hours in August 2019. This August, they worked a total of 20.9 million hours.

As a percentage, COVID-19 caused a greater reduction in hours worked than in employment in these two sectors. This continues to be true in the information and culture sector, where employment is actually higher than it was in February, despite hours worked still being lower. The reduction in hours of work and employment in accommodation and food services is now roughly the same, with both still below February levels.

 

Employment by Age Group and Gender

Employment continued to rebound for all age groups in August after a mixed result in July. The summer has been helpful for youth employment. The 15-24 age group is the only one in which employment is above pre-COVID levels. This trend is being driven by summer employment which boosts employment among young people who are available to work when they are not in school. Employment among this age group is likely to fall back over the next few months as seasonal businesses close and young people return to school. Indeed, on a year-over-year basis, youth employment has greater losses than any other age group. This shows that this summer’s youth employment increase has not been as great as in the past. Also worrisome is the significant loss of employment among those over the age of 65.

Employment levels for male and female workers increased by roughly the same percentage in August (1.1% and 1.4%, respectively). For males and females aged 15 to 24, the August increase in employment was the same (1.4%). However, for both females overall and females aged 15 to 24, the employment recovery since February has not been as strong. For males, employment is only 1.0% below February levels, while female employment is still 5.8% below February levels. For males and females aged 15 to 24, employment has surpassed the levels seen in February, but the recovery has been stronger for males.

On a year-over-year basis, the narrative is similar. Female employment losses since August 2019 are just over a percentage point greater than those of males. Among youth, the year-over-year change in employment is more equitable: both males and females who are 15 to 24 have lost approximately the same percentage of employment.

Autumn Employment Predicted to Fall

As expected, August brought a further employment increase in tourism, but the employment growth rate slowed. Most of the employment increase came from regions of Canada that had not started their final reopening phase when July labour force data was collected.

Going into September, expect to see employment drop for the tourism sector and for young workers. These may be muted somewhat in September by continued demand for patio dining and the continued use of outdoor recreation. Yet some decline is inevitable as summer vacations end and student workers return to school. While clubs and banquet halls must once again close in British Columbia due to COVID-19, other businesses focused on indoor recreational activities, such as museums and casinos, are just beginning to reopen. At the regional and industry level, employment will be highly volatile for some time.

With the border closed, Canadians looking to travel this autumn will need to consider the Canadian travel options available to them, instead of trips outside the country. While Canadians are still showing hesitancy to welcoming visitors from other parts of Canada, they are much more comfortable with domestic travel than they are welcoming visitors from outside the country. Any employment growth this autumn will need to be driven by demand from locals and Canadians travelling within the country.

Canada’s tourism sector is seasonal, and with the significant headwinds faced by the industry we are projecting employment declines in tourism during the fourth quarter of 2020 and in the first quarter of 2021, with a full recovery to 2019 levels is not expected until 2023.


[1] As defined by the Canadian Tourism Satellite Account. The NAICS industries included in the tourism sector are those that would cease to exist or operate at a significantly reduced level of activity as a direct result of an absence of tourism.

Results from new national research indicate that 90 per cent of Canadian LGBT+ travellers intend to travel domestically this year amidst international travel uncertainty. Spending an average of $1,800 per trip, substantially more than other travellers, this represents a $12 billion leisure travel opportunity for a sector devastated by COVID-19.

Safety, through the freedom to be oneself, is the key factor for Canadian LGBT+ travellers’ destination choice. That’s why the Government of Canada is investing in the National LGBT+ Tourism Project – a set of inclusion workshops and market-ready seminars – to support the industry in welcoming these travellers.

Inclusivity is not just the right thing to do, it is good business!

Programming is available free for a limited time to help grow your customer base when it needs it the most.

Join Canada’s LGBT+ Chamber of Commerce, in partnership with Tourism HR Canada, for the digital Navigating LGBT+ Diversity and Inclusion in the Tourism Industry workshops, then the LGBT+ Market-Ready seminars. Afterwards, you could be eligible to participate in a Destination Audit and also a new Accreditation program to be publicly recognized for your important contributions.

LGBT+ inclusivity can be part of Canada’s comeback. Owner-operators and tourism staff are encouraged to register at cglcc.ca/workshops or contact tourismcommunications@cglcc.ca for more details.

Future Skills Framework LogoTourism HR Canada has continued building the Future Skills Framework, a federally funded three-year project compiling a comprehensive bank of the competencies required in tourism.

For a set of online sessions to be held from September 21 to October 1, we are looking for tourism professionals with recent experience in either adventure guiding or travel services to join us for one—or multiple—focus groups to help us set the standard for our industry.

Please get in touch with info@tourismhr.ca for more details—we look forward to working with you!