Global Tourism: A General Outlook and PESTEL Analysis for the UK Market

This report provides detailed information about the tourism sector in the UK, including a general outlook of the global tourism sector, an introduction to the UK tourism market, a PESTEL analysis, and the current impact of tourism on UK society. It also offers recommendations for the industry.

Global Tourism

TABLE OF CONTENTS
INTRODUCTION ..........................................................................................................................3
1. Providing a general outlook of tourism sector in a global scale. ...........................................3
2. Introducing United Kingdom tourism market.........................................................................5
3. PESTEL analysis for the UK tourism market.........................................................................7
4. Explaining the current impact of tourism in the UK's society................................................9
CONCLUSION..............................................................................................................................13
REFERENCES..............................................................................................................................14

INTRODUCTION
Tourism is the sector or business of touring in order to attract and entertain tourists all
over the world. Providing excellent services and hospitality is the basic role of tourism sector.
The present report will provide detailed information about tourism sector of UK country.
Further, the report will analyse PESTEL and its impacts on the country it will include political,
economic and other factors. At last, the case study will give current impact of tourism in the
society and provide recommendations.
1. Providing a general outlook of tourism sector in a global scale.
Tourism is an economic, social and cultural phenomenon, which means people travel for
personal or professional purpose. It is the business operations in the hospitality field of
accommodating people all over the world. The main purpose of tourism industry is to boost the
economy revenue, improve the infrastructure of a country, provide employment to people, and
develop a sense of cultural, belief and values exchange between citizens of a country and
travellers (Al-Thoblany and Alyuosef, 2021). Tourism plays a vital role in economic success and
growth of country. Many people are getting jobs in the tourism industry which is directly linked
to different sectors like communication, health, hospitality, agricultural and other sectors.
Nowadays, many tourists travel to different countries to experience the culture, traditions and
events of destination. Tourism industry is very profitable to different types of local businesses
such as shopping centres, local hotels, stores and restaurants.
In today's business environment government rely on tourism industry for big percentage
of profit margins so, they invest a lot in developing the infrastructure of the country or states.
Government are more focused on tourists' satisfaction so, they want more people to travel their
country in order to provide them safe and quality services. Safe and attractive infrastructure

allow travellers to visit more at the destination and enhance smooth flow of excellent services or
facilities. Government involvement plays a vital role in tourism sector because it leads to new
main road, developed public garden, better infrastructure in the country.
The travel sector creates benefits for the country in different ways such as cultural
exchanges. Public areas and authorities will make profits from exhibition, events and other
activities performed in the country (Cheung and et.al., 2021). It has created positive environment
in the foreign as well as domestic countries as it has allowed young generation to learn about
new values, civilization and culture. The travel industry promotes cross-cultural connections
which is beneficial for overall growth of the hospitality sector. Tourism in many countries has
immense potential of improving into high revenue in various field like transportation. According
to reports, it has been noted that every year, around 1 billion tourists take trips internationally as
well as domestic. In the year 2019, around 79.26 million travellers has visited the country UK. It
has been also noted that total 5-6% of global GDP has been generated by tourism sector.

2. Introducing United Kingdom tourism market.
Tourism plays an important role in the country united kingdom as it has contributed GDP
around 60 billion in the year 2017. According to research reports, there were 38 million visitors
to the country (Hayes, 2021). There are various tourism programmes and policies made by UK
government such as increase international and domestic visitor, work with tourism industry in
order to boost cultural exchanges, decrease unemployment and make sure to make visitors
comfortable to explore London. The travel industry is the fastest growing field which has
potential to stimulate the economic development and growth of the country. It plays an important
role in order to maintain airports, hotels and other tourist destinations. The UK tourism ministry
provides financial advice and innovation suggestion to the state and central agencies in order to
improve culture and promote the natural beauty of different regions.
There has been increasing trend in digital connectivity and new technology as the people
are travelling to UK. Due to digitalization, 80% of travellers books their travel and holiday
package online and 56% audience use technology to find attractive offers (Jahangir, Mousavi,
and Zarchi, 2021). The UK government sees this practices as an opportunity to understand the
buying behaviour, habits and travellers motivation in innovative way. This would also help them
to understand customer needs, preferences and choice of location. The detailed information about
destination choice would help the government of UK understand the gaps in its tourism market
and inform right facilities or services in order to maximize visitor numbers. Such data could also
help them to understand the marketing strategies of other company and useful in informing
marketing campaigns.

After pandemic, the UK's tourism industry has been hard hit and there has been a slight
decrease in GBP which is 23 billion. The variety of different kinds of industries has been
particularly hard hit because of coronavirus pandemic (Li, Yao and Chen, 2021). Industries like
travel agencies, transportation, food and beverages, events and conferences and others. 3.9
million of citizens were employed during the year 2018 but there has been decreasing trend of
employment in the year 2019-2020. A government of UK has taken major steps to deal with
pandemic in order to support hospitality and related sectors.
 The government has established coronavirus job retention scheme by giving £12 billion
in order to support citizens of the country. This step has increased the percentage of
employment in the field like travel, hotels and others.

 The government has provided loans to tours and travels company which is £5 billion by
reducing the rate of interest in the year 2020.
 The amount of £2.5 billion has been provided by the government for accommodation and
hospitality industries. In the year 2020, they were more focused on reducing VAT from
20% to 5%.
 The UK government has announced its tourism recovery plan in the year 2021 in order to
accelerate the tourism industry recovery from coronavirus pandemic.
3. PESTEL analysis for the UK tourism market.
PESTEL analysis is the method used by companies to evaluate the external environment
so that risks and opportunities can be break down into various factors.
Source: PESTEL analysis, 2021
Political factors- when studying about political factors, it means to understand the
government policies and rules and related factors that can affect a business activity. It includes
trade restrictions, tax regulations, tariffs and other factors. Political stability plays a vital role in

the overall success of travel industry. Thanks to political stability of UK, people are able to visit
different countries and explore different destination. Because of friendly borders, the vast
majority of locations can now be visited by travellers from all around the world in the UK. All
thanks to the technology, people can apply for a visa easily by adopting few rules and
regulations. Tourists are able to claim their tax refund on services or goods purchased during
their holiday trip.
Economic factors- These economic indicators includes exchanges rates, inflation,
unemployment rates and interest rates. According to reports, When the decision of Brexit was
announced by the government every person was worried about how the economy would be
affected. All the business industries such as transportation, hospitality and travel agencies are
staying cautions about their business. UK's government are now focusing on rising disposable
incomes by providing them employment and other facilities. This has lead to an increase in the
use of technology and electronic gadgets. This is one of the most positive factor for travel sector
and hospitality field.
Social factors- These factors are related to demographic and cultural trends of society in
the country. Social trends and rules are key elements to determining customer buying behaviour.
It includes perceptions, health, population growth rates and career attitudes. Tourism industry
has become a trend for young people and social media has a lot of work to do with this field. As
people are more concerned about health and culture in the world thus they want to experience
those different culture and accept them. This form of knowledge growth towards the travelling
industry is one of the most positive element for tourism sector in the United Kingdom.
Technological factors- According to research reports, the travel industry has recently
received a major upgrade due to technology and new forms of transport services in the UK. More

options are available to travel in the country in order to explore the nearby locations. For
example- Aeroplane for long distance travel and local transportation at cheaper price (Pastore,
Webster and Hope, 2021). Moreover, online booking can be done with the help of internet on
official website of travel companies. People are now get to know about different beautiful places
across the world through gadgets like smart devices, social media, videos, advertisements and
other promotional activities. Travel blogs of UK help people get the detailed information about
destinations. This has really improved the economic and technological conditions of the tourism
sector.
Legal factors- legal factors means any legal activities that industry can or cannot do. It
includes industry rules, labour laws and licences and permits. UK's government has allowed
banks to provide loans for travel purpose so that people plan their tour internationally. Tourism
have become more hassle free for customer to take benefits while travelling.
Environmental factors- Industries in the UK need to plan according to ecological
impacts on tourism field. It includes weather, climate change, pollution and other natural
calamities. Types of pollution like air pollution, noise pollution, water pollution caused by the
rise in tourism is destroying natural beauty like beaches, garden and public areas. So, tourism
and government in the UK is more focused on adopting their business operations to be Eco
friendly. They have taken strict action to regulate pollution levels caused by travellers.
4. Explaining the current impact of tourism in the UK's society.
According to research reports, the current impact of tourism on both the economic
development and growth is clearly positive. Employment is the another elements which has
positive impact of travel industry as it has provided jobs to citizens of the country. Overall, it has
positive impact on the income and living standards of the people.

There is good quantifiable data that tourism has positively contributes on the gender and
pay scale quality and working hours of the employees (Pastore, Webster and Hope, 2021).
Tourism represents the GDP generated by business activities related to travel such as hospitality,
restaurants, airlines, tour operators and agencies. Capital investment in travel industry are
directly involved in other sectors such as accommodation and transportation services.
UK's government spending for tourism in order to support the travellers and economy
which can involve local spending and national income. The supply chain of goods and services
represent the buying capacity of citizens. It means tourism has positive impact on the domestic
business such as small stores and local shops.
Table showing various sector in the UK Contribution to GDP
Direct contribution of tourism sector  Retail industry

 Transportation services
 Sports, events and cultural services
 Entertainment
 Accommodation
 Attracting audience
 Trading
 Employment
 Import export of good and services
 Food and beverage facilities
Indirect contribution of tourism
sector
 Investment spending by private travel industry
 Collection done by government
 Impact of purchases from vendors
By evaluating the available data, the England has around 33,374 businesses
accommodation such as guest houses, restaurants, hotels with around more than 78,000
bedrooms. There are total 31,845 other accommodation businesses such as camping, holiday
homes with more than 1,401,715 bed spaces. It has been noted that there are total 5000-6000
travellers attractions in England.

Source: Tourism in the UK economy, 2021.
Tours and travel sector is a leading industry to provide employment throughout the
world, the sector is directly employing more than 90 million people in the world. According to
the latest report of economic impact, tourism in England contributes around £106 billion to the
GDP and provides 2.6 millions jobs to needy people.
Recommendations- By evaluating the report and given information on tourism sector of UK, it
is advisable to focus on competitive price in the travel industry. Always keep track on
competitors' analysis in order to provide the best facilities to the tourist. Tour operators gives the
best facilities to the tourist in the country by comparing market price. It is advisable to negotiate
with vendors of tourism services like airlines, restaurants and hotels in order to provide the
affordable price as per the needs and preferences of travellers.

Tour operators and travel agency plays a vital role in attracting customers to united
kingdom. It is suggested to provide the best possible facilities like holiday package, event
coupons at reasonable price to the tourist. It is also recommended to purchase tourist services in
bulk so that guests can get huge discounts and offers from suppliers for holiday trips. If travel
agency helps the country to attract more visitors and motivate them to spend more quality time at
their favourite destination than it can improve economic conditions and growth.
CONCLUSION
To conclude, Tourism has positive impact on income, livelihoods, employment and
growth of economy. By evaluating the present report, it is concluded that tourism has both
positive and negative impacts to women staff within tourism industry. So, government of UK is
taking initiative step to solve various impacts of tourism on the country. Furthermore, it is also
summarized that tourism sector will grow in the near future due to various factors like
technological, government support, political laws and economic advantages. However, pollution
and environment factor needs to be dealt with care for tourism and hospitality sector to become
ethical.

REFERENCES
Books and Journals
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performance of tourism sectors in the Kingdom of Saudi Arabia in the light of 2030
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tourists: implications for the travel and tourism industry. Journal of Travel & Tourism
Marketing. 38(2). pp.155-166.
Hayes, D. K., 2021. Human-Resource Management in the Hospitality Industry.
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industry. John Wiley & Sons.
Jahangir, M. H., Mousavi, S. A. and Zarchi, R. A., 2021. Implementing single-and multi-year
sensitivity analyses to propose several feasible solutions for meeting the electricity demand
in large-scale tourism sectors applying renewable systems. Environment, Development and
Sustainability, pp.1-34.
Jooss, S., Burbach, R. and Ruël, H. eds., 2021. Talent management innovations in the
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Li, Y., Yao, J. and Chen, J., 2021. The negative effect of scarcity cues on consumer purchase
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Pastore, F., Webster, A. and Hope, K., 2021. Assessing the role of women in tourism related
sectors in the Caribbean. International Journal of Tourism Research. 23(3). pp.378-400.

Schwepker Jr, C. H. and Dimitriou, C. K., 2021. Using ethical leadership to reduce job stress and
improve performance quality in the hospitality industry. International Journal of
Hospitality Management. 94. p.102860.
Škare, M., Soriano, D. R. and Porada-Rochoń, M., 2021. Impact of COVID-19 on the travel and
tourism industry. Technological Forecasting and Social Change. 163. p.120469.
Online
PESTEL analysis. 2021. [Online]. Available through:
<https://corporatefinanceinstitute.com/resources/knowledge/strategy/pestel-analysis/>
Tourism in the UK economy. 2021. [Online]. Available through: <https://www.oecd-
ilibrary.org/sites/2ac0c5e9-en/index.html?itemId=/content/component/2ac0c5e9-en>