Detailed Analysis: Tourism's Impact on the UK Economy

This report comprehensively analyzes the contribution of the tourism sector to the UK economy. It begins with an introduction highlighting the industry's role in revenue generation and economic growth. The report delves into the UK's tourism statistics, showcasing its significant growth, particularly in recent years, and its impact on employment figures. It references data from the World Travel & Tourism Council (WTTC) and other sources to illustrate the sector's financial contributions and its position as a major global player. The report examines the drivers behind tourism's growth, such as low barriers to entry, and provides future projections indicating continued expansion and increased revenue. It also discusses the positive impacts of tourism, including employment generation, cultural preservation, and foreign exchange earnings. The report uses statistical data from 2017 to demonstrate the increase in inbound visits and spending, concluding with a summary of the sector's importance and future trends, emphasizing the potential for further economic growth.

Discuss how tourism
contributes towards the UK
economy

TABLE OF CONTENTS
INTRODUCTION...........................................................................................................................1
Tourism contribution in UK economy.............................................................................................1
CONCLUSION................................................................................................................................5
REFERENCES................................................................................................................................6

INTRODUCTION
Travel and tourism sector is quite beneficial for every nation as revenue is easily
generated by the industry which ultimately benefits whole economy. Present report deals with
contribution of tourism sector in UK economy and how sector has largely contributed to
economy. Moreover, past and recent trend is analysed which implies growth of nation provided
by travel sector in effective manner. Success of tourism is also highlighted by the statistics
provided of inbound visitors in recent reports. Furthermore, future trend is also enumerated in the
report and as such, travel and tourism sector will produce more profits in coming years. Thus,
analysis of tourism sector is explained which provides clarity that industry will inject more
growth and whole economy will be benefited quite effectually.
Tourism contribution in UK economy
UK is one of the developed nation which has higher GDP (Gross Domestic Product) as
compared to other nation. Travel and tourism is quite useful to nation as major revenue is
generated from it. UK has various tourist destinations and as such, large number of visitors
attract towards and revenue is generated quite effectually. According to the reports provided by
WTTC (World Travel & Tourism Council), UK's travel industry has grown significantly in
recent years. This is evident from the fact that in 2012, growth rate was increased up to 1.3 %.
According to Hjalager, 2018 (p.102), this is one of the major reason of healthy growth of
economy as travel companies have generated good quantum of profits by satisfying customers in
the best possible way.
In relation to this, 1.3 % of growth means that travel industry alone has generated 35.6
euros in the financial year which has benefited overall economy in better way. This has impacted
employment as well. This can be analysed that unemployment rate has gone significantly as due
to increase in revenue, number of jobs increased as well. This can be assessed that tourism
industry will provide employment to 2,50,000 people between 2010 and 2020. It is largely
beneficial for the companies and nation will inject higher growth in coming years. This means
that unemployment rate will reduce up to high extent in the future which is beneficial for UK as
more growth will be achieved in better way.
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Moreover, UK has one of the largest tourism industry in the world. This can be further
explained that country has fifth largest travel sector which is great for the country. In relation to
this, there are 2,00,000 tourism businesses in the nation. The nation has 70,000 well-furnished
hotels, country house hotels and moreover, there are 110,000 restaurants and bars are relied on
tourism sector which means that these hotels and exotic restaurants are heavily reliant on travel
industry. This implies that travellers are needed in large quantum in the best possible manner. In
relation to this, 7000 enterprises which includes heritage, museums, zoos and other businesses
are also reliant on this sector so that profits may be accomplished in effectual manner. According
to Dwyer 2018 (pp.29-48), by looking at the figures of tourism sector, it can be said that industry
is performing well and tourists are attracted to country as it has beautiful destinations.
Tourism industry in UK is attaining more growth year by year because of various
reasons. Among them, one of the main force injecting growth is low barriers to entry. This has
contributed good profit to the industry as more and more of firms can easily enter in tourism
market of UK. This has helped nation in the best possible way as employment is increased
rapidly which is driving force of travel sector as more jobs are produced leading to decrease in
unemployment rate up to high extent. Moreover, it is expected that in the future, industry will
further grow and alone travel and tourism sector will contribute 100 billion euros. This means
that UK will have more growth in the future and as such, tourism will inject more growth to
nation in significant manner.
Tourism contributes maximum to UK economy as it the creator of employment to local
people and is supporting 3.8 million jobs and it increases every year. Tourism in UK is famous
because of its hospitality services and tourist attractions. Inn 2007 tourism contributed £114
Billion to economy and created employment opportunity for 1.4 million people. This comparison
of figures denotes the growth of business and its contribution to economy. According to Holland
and Holland, 2016 (pp. 69-87), the contribution of tourism in economy of UK is reflected in
employment opportunities, cultural awarenesses, increasing business of hoteliers, foreign
exchange, stimulation of trade and income for small business enterprises. Further, the
contribution of tourism is promoted generation of taxes and income which assist the economy in
growing strong. As per World Travel & Tourism Council, the tourism industry of UK grew by in
2012 by 1.3% and this growth reflects contribution to economy which was £35.6.
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Moreover, UK is known for its tourism industry and it stands on fifth across the globe
and it comprises 70,000 country house hotels, holiday parks and high end hotels. However, there
are 110,000 bars, pubs and restaurants who are assisting tourism business of UK. In addition,
there are 7,000 cultural and heritage sites, theme parks etc. which are major tourist attraction and
is promoting business and economy. The growth of UK economy from Tourism is analysed from
growth of key drivers that is consumer spending, bilateral exchange rates, investment, tourist
attractions and performance of economy as a whole. According to Narduzzo and Volo, 2018
(pp.735-741),UK earns ‘fair share’ of visitors from emerging markets which is an example of
tourism contribution to GDP of UK. There are approximately 32 million travellers every year
visiting UK for the purpose of business, educational trips, adventure etc.
There are various positive impacts of tourism sector on the country. Employment is
generated in effective manner as industry grows and more people are employed, thereby
reducing unemployment rate up to high extent. Moreover, culture and various old monuments
are preserved which nation to have more growth in effectual manner (Curtis, 2018). Money
utilised from tourism can be effectively utilised to develop infrastructure in the best possible
manner. Main positive impact is seen as foreign exchange is garnered in large quantum which
help nation to utilise the same for public welfare and local people are benefited quite effectually.
This means that whole economy benefits from the money garnered by tourism sector. It can be
said that UK has fifth largest tourism businesses which contributes to overall economic growth
of company in effective way.
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The above data shows about inbound tourism statistics of October 2017 which clearly
states that revenue has been generated in effective way. In accordance to the facts above, UK has
welcomed 3.2 million of inbound visits in the month of October which has given effective profits
by the companies. Moreover, in between August to October 2017, there were 10.1 million visits
which is huge profitable for UK. Earlier, there were 33.3 million visits in first ten months of
financial year 2016. In relation to this, in 2017, scenario was completely changed as there were
39.3 million inbound visits which clearly shows that travel sector has garnered huge economic
growth to country. Furthermore, spending of visitors also increased up to 1 %. This is evident
from the fact that inbound visitors spending is record breaking for latest 3 and rolling 12 months
(Inbound visitor statistics for October 2017).
Inbound visitors have spent 7.2 billion euros in August to October 2017. This trend has
been continued in as 10 % increment has been made which is quite effective for travel and
tourism sector. Moreover, country is benefited up to high extent (Schegg and Stangl, 2017). This
has helped travel sector to gain more revenue in the best possible manner. The future trend of
industry is that it will provide more revenue and UK will occupy the largest place in terms of
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Illustration 1: Inbound tourism statistics October 2017 Source: visitbritain.org

profitability as more and more tourists will attract to nation providing enhanced economic
growth in effective manner. Another strong point of UK is that there are number of beautiful
destinations which attracts various passengers to have outing with their near and dear ones. In
accordance to Weidenfeld, 2018 (p.319), it can be said that UK will inject more economic
growth as forecasted by recent remarkable figures. The travel and tourism will further produce
more profits benefiting whole economy.
CONCLUSION
Hereby it can be concluded that travel and tourism sector is quite useful to nation in
providing economic growth in the best possible way. UK is able to achieve growth in effective
way as recent statistics have clarified that inbound tourists are attracted to country for spending
leisure time with families and friends. Moreover, spending by visitors are also increased by large
margin which shows effectiveness of travel industry in UK. Thus, it can be concluded that nation
will be enhanced with more growth and travellers will visit in large numbers benefiting whole
nation.
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REFERENCES
Books and Journals
Curtis, S., 2018. Strategic Destination Management in the UK-an Overview.
Dwyer, L., 2018. Saluting while the ship sinks: The necessity for tourism paradigm
change. Journal of Sustainable Tourism. 26(1). pp.29-48.
Hjalager, A.M., 2018. Strategic innovation in tourism business. Strategic Management in
Tourism, CABI Tourism Texts, p.102.
Holland, R. and Holland, J., 2016. Non-Aviation-based Tourism: A UK-based Perspective. In
Tourism Enterprises and the Sustainability Agenda across Europe (pp. 69-87). Routledge.
Narduzzo, A. and Volo, S., 2018. Tourism innovation: when interdependencies matter. Current
Issues in Tourism. 21(7). pp.735-741.
Schegg, R. and Stangl, B., 2017, January. Information and Communication Technologies in
Tourism 2017. In Proceedings of the International Conference in Rome, Italy.
Weidenfeld, A., 2018. Tourism Diversification and Its Implications for Smart
Specialisation. Sustainability. 10(2). p.319.
Online
Inbound visitor statistics for October 2017 [Online] Available Through:
<https://www.visitbritain.org/latest-monthly-data>
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