Analyzing Brexit's Impact on the Growth and Challenges of UK Tourism

This report investigates the impact of Brexit on the UK tourism industry. It begins with an introduction to Brexit and its economic consequences, including the decline of the British pound and the relocation of businesses. The report then analyzes the challenges faced by the UK tourism sector, such as potential declines in visitor numbers from the EU, labor shortages, and increased travel costs. It also identifies anticipated changes within the industry, including shifts in visa requirements, air travel costs, and hotel rates. Finally, the report suggests actions the UK tourism industry can take to mitigate the negative impacts of Brexit and foster growth, such as promoting visa-free travel, safeguarding transport links, and seeking joint agendas with other countries to boost tourism. The report draws on various sources to provide a comprehensive overview of the issue.

Impact of Brexit over
the growth of tourism

Table of Contents
Aim : - To determine the impact of Brexit over the growth of tourism. A study on UK tourism
industry............................................................................................................................................3
ELEMENT 1:- ................................................................................................................................3
LITERATURE REVIEW.......................................................................................................3
The concept of Brexit and its impact on UK..........................................................................3
Challenges faced by UK tourism due to Brexit......................................................................4
Several changes that get anticipated within UK tourism industry after Brexit......................5
Different actions that must be taken by UK tourism industry for overcoming impact of Brexit
................................................................................................................................................6
ELEMENT 2....................................................................................................................................7
REFERENCES..............................................................................................................................10

Aim : - To determine the impact of Brexit over the growth of tourism. A
study on UK tourism industry.
Objectives : -
 To analyse the concept of Brexit and its impact on UK
 To determine challenges faced by UK tourism due to Brexit
 To identify several changes that get anticipated within UK tourism industry after Brexit.
 To ascertain different actions must be taken by UK tourism industry for overcoming
impact of Brexit
ELEMENT 1:-
LITERATURE REVIEW
It is consider as crucial part of a study which focuses toward gathering secondary
information over a current area of study in order to develop an understanding regarding the
nature of study. This also contribute toward creating a base over which further study can be
conducted.
The concept of Brexit and its impact on UK
Kimberly Amadeo, 2020, stated that Brixit is shorthand of British exit from European
Union, that UK has left on Jan 31 2020. This exit process begins when United Kingdom has
appealed to leave EU. This was so because the residents decided that the benefit of belonging to
the unified monetary body no longer over-weighed the cost of free movement related with
immigrants. This action is mainly taken by UK in order to change its relationship with EU in
term of trade, migration and security as the residents find difficulty in performing this and also
experiencing losses. This event involve several terms within the agreement that UK has to follow
since it is leaving European Union. One among them was that UK was not remain a part of
“customs union” with EU but it is allowed to Northern Ireland. It means that there remains a
custom and regulatory border among Northern Ireland and Great Britain for Irish Sea which
involve VAT. Additional, EU and UK also negotiated over a trade agreement where both of
them have to pay tariffs over each other's import.
According to author the main reason behind Brexit is that the working class resident's of
England was afraid from the free movement of refugees. As they claimed that the citizens from
the poorer countries are taking jobs and other benefits. Along with this the small businesses

finding difficulties in due to EU fees which is higher and residents think that UK pay more to EU
then it receive. The Brexit bring negative influence over UK as the economy get slowed down
and businesses moved their headquartered from UK to EU countries which affect the factors like
growth, jobs and trade. It also damaged the economic growth of UK as trade get affected and
British pound fell from $1.48 within a single day which also increase the price of import.
As per the information provided by Benjamin Mueller, 2020, Brexit brining up several
impact over UK as Europe was Britain's most important export market and its biggest source of
Foreign direct investment and the membership in this bloc has supported London in becoming a
global financial centre. But after Brexit, majority of businesses announced that they are leaving
from UK due to it or they are forced to do so. In this list of relocating business, Airbus is also
one among them which employs around 14000 people and support more than 100000 other jobs.
The working people who are considering the immigration as a threat for their job, think it as a
triumph. But it end up by cutting down both the ways as the prospect was dispiriting the
youngest of UK who was dreaming for abroad study.
Challenges faced by UK tourism due to Brexit
As per the thoughts of Simon Calder, 2016, The UK tourism holds up one-eleventh part
of GDP which provide more then 3 million jobs. Hence the influence of Brexit over the domestic
tourism is much more considerably important to put attention. More than 63 percent of inbound
holidaymaker to Britain belongs to European Union. Hence the number of visitors that comes to
UK get affected by leaving the vote in referendum. In present time more than quarter tourist
arrived through inbound that are VFR visiting friends and relations. They pay less than organic
tourist visit but still it leave behind around £5bn a year payment in term of travel within UK,
accommodation facilities, foods, drinks etc.
The major challenge that UK tourism industry faced due to Brexit is that majority of
people working within the tourism industry belongs to EU and after Brexit to leave to their
country which results into decline of talented and skilled employees in industry that affect its
quality of performance. Additionally the people from overseas working in UK sustain a
significant number of flights to and from Britain and these come to an end then the Tourist
industry profit will likely to fallen down.

On other side, according to Cowie, P., Mulvey, G., Peck, F. and Shaw, K., 2018, with the
current Brexit issue against travel and tourism industry it has been found that there are number of
challenges that this industry has faced which includes,
Travel delays and difficulties :- The main noticeable effect from Brexit is rise in the
cost of airfares. In EU there are number of restrictions which get imposed over airlines and
outside of the EU restrictions are also imposed which increases the difficulties that British tourist
found to visit EU countries. On the other side the difficulties at border also get increased with the
increase in delays. This is so because with the lack of free movement within EU it require greater
processing time from the travel authorities.
Increasing cost :- The another major difficulty is from increasing cost of medical and
insurance access. As previously being an EU member, tourists are able to have free access over
health related services using European Health Insurance card. But after Brexit it is not possible
and travellers either have to buy additional insurance for journey or risk incurred. This results
into additional cost of medical emergency that may arise in front of the tourists if they
experience any kind of risk or health service need.
These both are the major issue that can be seen in travel and tourism industry of UK
which is affecting it badly. But other than this another challenges that UK travel industry facing
is that it have less employees to be recruit for travel and tourism industry that are highly highly
skilled. The cost of recruitment and retaining of employees belongs to EU countries are
relatively higher. Hence this shortages of skills and capabilities within the industry is affecting
its overall performance and growth which is a major challenges that get arises after Brexit.
Several changes that get anticipated within UK tourism industry after Brexit
According to the view point of McKee, D. and McKee, M., 2018 the event of Brexit
brings up huge influence over the travel and tourism industry of UK by changing up the
relationship between UK and EU that has shuffle up the previous practices through which the
travel business mainly performed in country. The Brexit has leads to falling of pound rate
sharply and this weaker sterling has bought larger herds regarding the business travellers.
Despite of the corporate travel slowdown, travellers have to face longer lines and crowd over
airports or big tourists destinations like London which was around 90 second. While the weaker
pound doesn't contribute much to the business travel, it will be really beneficial for UK tourism
with 21% more tourist visitors that are going for their vacations. Addition to this, one recent

decision has been made by British Government that not to require visitors from EU country for
applying Visa. The likely factor into the determination is the fact that UK already grant visa-free
travel to around 56 countries. Due to Brexit the rates of air travel is increasing, as the largest
organisation i.e. Airbus has shifted its operations from UK after Brexit. As a result of which
country has less resources to manage its operations which in turn has increases the cost of air
travel. Other than this, hotel rates are also getting higher due to Brexit as the inflation rate get
increased which in turn directly influence the flow of tourism practices within the country.
Addition to this the prior to Brexit the students from EU countries are free to live and
work within UK but now they have to firstly take permission from government then only they
would be able to live. This has created a dilemma among the European workers and they started
leaving the Britain as they started seeing that their pay in pound doesn't stretch as far as it is used
and the people who are planning to visit UK remain confused about the uncertain status
of country after Brexit.
On the other hand as per view point of Pappas, N., 2019, Brexit make it more difficult for
the travel and tourism industry is employ citizens from EU member state. In case when the
agreement which the UK have with EU after Brexit did not involve the free movement of
persons and then the workers from EU state would be subjected to immigration law. In the light
of these restrictions the employment process would be slower and remain more expensive for the
players working within the travel and tourism industry. In addition to this the conditions of travel
and tourism practices will also get changed in some areas. This includes consumer rights related
with package holiday, access to emergency related with medical care for travellers which is
based on European Health Insurance card, rights of air passengers in case of delays or
cancellation of flights, caps on roaming fees etc.
Different actions that must be taken by UK tourism industry for overcoming impact of Brexit
According to the view point of Phil Davies, 2019, travel and tourism can proves to be a
major UK growth sector after Brexit. It grew by just 1% last year to represent £234 billion,
which is just below the world average growth rate i.e. 3.9 %. But still the UK remains at fifth
position in term of tourism economy throughout the world by its economic contribution behind
China, Germany, Japan and US. The growth of travel sector is being suggested by several
experts through their investigation. Additionally it has been estimated that after Brexit, UK has
provided several job opportunities to people in travel and tourism sector by contributing with

around 4.2 million jobs in UK. In addition to this the government of UK is also seeking for joint
agenda with other countries or overseas market in order to attain the growth of travel industry of
country. The majority of tourism Ireland mainly get from Britain but after Brexit country is being
quite worried about its tourism practices. In order to deal with this, around 4 million campaigns
are being rolled out in Britain in order to highlight the island of Ireland to prospective visitors in
order to maintain strong growth.
As per the information presented by Hadfield, A. and Hammond, M., 2016, UK travel
and tourism industry plays a crucial role in economy of country by contributing around 9% of
total economy activity. By keeping it in mind it is crucial for industry to continuously remain
prosper post-Brexit and holiday maker. The UK is providing more benefit to the travellers by
providing visa free travel and access top free or reducing the cost of healthcare access in order to
attract more and more tourists. Despite of all this it is also working toward safeguarding the
transport link which includes air routes and protecting the consumer rights. Several policies are
also being planned to formulated in order to change the regulations or reducing the taxation
where it is possible in order to remove the restrictions that get arises out of Brexit so that their
remains a free flow of tourism practices. There are mainly five major factors over which
government of UK is focusing such as maintain the ability to travel freely within Europe and
beyond, keeping visa-free travel between EU and UK, protecting consumer rights, seize
opportunity for growth and giving UK business operational stability.
ELEMENT 2
The travel and tourism sector of UK ranked as 4th largest industry in world, but due to
Brexit it face numerous of issues which also affected its performance as well as quality of
services. Therefore, it become crucial to maintain the quality of services for gaining back the
economic position of country with the flow of tourism practices. But it can be said that the UK
travel and tourism industry can get benefit with the decision of country to leave European Union
(Mohamed, Pärn and Edwards, 2017). This is so because the weak Pounds can make the UK a
more stronger and cost effective destination for both the international as well as domestic
holidaymaker. This is so because as the Pound rate has drop down in the market then the
managers of travel and tourism organisation can promote their services in order to attract
international tourist to visit UK for their satisfying their leisure need. This help in ensuring the
free flow of foreign fund to the country and it further help in improving the travel and tourism

industry performance and at the same time brings in growth of the economy. This is so because
there are number of benefits that tourists can avail which their travelling to UK which help in
attracting them. It includes hotel and accommodation rates fell down by -4%, -3% among the
leisure and cultural activities and travel and tourism sector experience a drop in -4%. These can
be used as a factors to attract tourist from several different countries (UK travel and tourism
industry will benefit from Brexit, 2016).
On the other side, with the decrease in rate of pound the international travel for citizens
of UK has become more expensive that has restricted the growth of the travel and tourism sector
from its domestic people (Watson and et. al., 2018). But in order to maintain the smooth
functioning of this sector the managers can organise marketing campaign for promoting the
domestic tourism destination so that the industry can grow continuously by getting both domestic
as well as international tourism flow in the country. Meanwhile the fluctuation in currency has
also made the travel to UK from US and Europe much more affordable which support the
incoming tourist to get more bang for their buck. Hence it can be said that weakening of pound
within the country become beneficial for the travel and tourism sector as it help in “making
holiday within UK more appealing”. As the low Pound Sterling help in promoting UK tourism as
duty free prices which make it more attractive for the visitors who come from several different
part of the world but on the other side it made up a reverse effect over the British people that
want to travel abroad as they have to spend more (Dogru and Bulut, 2018).
Tourism is one of the major success story within UK which work toward growing
employment throughout the country by supporting education, investments and trade which shows
UK as open and welcoming opportunities (Cowie and et,. al., 2018). For this, an immigrant
regulation has been formulated across all the industries which allows the highly skilled workers
can be recruited from outside the EU and workers of all skills from within EU. Additionally, it
also involve a transitional measures where all the workers that don't belong to UK have to be
work over a 12 month visa and that can't be reapply in order to avoid permanent employment
(UK tourism industry set to struggle under post-Brexit immigration plans, 2019). This can be
utilised by travel and tourism operators of UK as they can attract the talent from several different
countries in order to ensure that innovation can be brining in services offered to tourist. Despite
of this, it also provide an opportunity to formulate strategies of attracting tourism from different
countries from which the employees are being recruited. This in turn contribute toward

improving the tourism practices within the country as reduction in pound has become an
attracting factor for the tourists to fulfil their desire of travelling in UK at lower price then earlier
(Kriesberg and Gerard, 2018). So, this is an opportunity in front of the UK tourism sector so in
case when it managed properly by spreading more and more messages to the tourist regarding
the offerings of UK travel and tourism sector then it would act as a booster for the growth and
success of industry and country's economy at great extend.
Despite of all this, in order to improve the position of travel and tourism industry,
managers must focuses toward improving the services its offers to the travellers and try to keep
the prices lower. In addition to this it must also focuses toward improving the promotional
practices of the industry so that more and more people can be attracted toward it. This will
support in improving the flow of tourism within the industry and improving its growth rate
which further contribute toward enhancing the economic position of the country (Gartzou-
Katsouyanni and et. al., 2018). This is so because the continuous flow of tourism will ensure the
foreign currency flow within the country that contribute a lot toward improving the
infrastructure and other factors which remain crucial for improving the economic condition of
UK.

REFERENCES
Books & Journals
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Hadfield, A. and Hammond, M., 2016. Kent and Medway: making a success of Brexit: a sectoral
appraisal.
Kriesberg, L. and Gerard, C., 2018. Implications and recommendations. Conflict and
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rest of Europe?. The journal of the Royal College of Physicians of Edinburgh, 48(2),
pp.134-140.
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