Analysis of Tourism's Contribution to the UK Economy and Future Trends

This report analyzes the significant contribution of the tourism industry to the United Kingdom's economy. It highlights that the tourism sector contributes substantially to the UK's GDP and supports millions of jobs, both directly and indirectly. The report discusses the industry's performance, including spending by domestic and international visitors, and analyzes factors influencing tourism, such as exchange rates and digital advancements. It explores the impact of the digital world on tourism, emphasizing the importance of technology for future success. The report identifies future opportunities and trends, including investments in infrastructure, marketing, and business sectors. The report concludes by emphasizing the tourism industry's current economic contribution and the importance of adapting to evolving market dynamics and digital strategies to ensure continued growth and success. The report also references several key academic publications and industry reports to support its findings.

Running head: FUNDAMENTALS OF TOURISM, LEISURE, HOSPITALITY AND
EVENTS SECTOR
Contribution of Tourism towards the UK Economy
Name of the University:
Name of the Student:
Author Note:
(Word Count: 1300)

FUNDAMENTALS OF TOURISM, LEISURE, HOSPITALITY AND EVENTS
SECTOR
Table of Contents
Introduction................................................................................................................. 2
Discussion...................................................................................................................2
Scenario Analysis....................................................................................................3
The Digital World.....................................................................................................3
Future opportunities and trends...............................................................................4
Current scenario......................................................................................................5
Conclusion.................................................................................................................. 6
References..................................................................................................................7
1

FUNDAMENTALS OF TOURISM, LEISURE, HOSPITALITY AND EVENTS
SECTOR
Introduction
The tourism industry has delivered a significant contribution to the economy of
United Kingdom. As per leaked information, it is evident that the industry has
delivered approximately 58 billion pounds, which accounts for around four percent of
the GDP of UK. This in turn, takes into account the value that is generated by the
provision of tourism related to services and goods. In terms of employment, the
industry contributes through supporting over two million jobs (Hanafiah, Jamaluddin
and Zulkifly 2013). Moreover, taking into consideration the direct as well as indirect
impacts, which includes the aspect of supply chain, tourism has contributed huge
amount to the overall economy of UK. Taking the direct impacts, tourism contributes
are 48 billion pounds, which supports over one million jobs (Simão and Partidário
2012). The essay throws light on the contribution of the tourism industry towards the
economy of United Kingdom.
Discussion
In the year 2014, there were around 200,000 VAT registered business fields
in the sectors of tourism in United Kingdom. This included food and beverages,
accommodation, travel agencies, transport, cultural activities and many more. In the
year 2016, the residents of British have spent around 18.5 billion pounds on
overnight trips, adding up to the 288 million nights staying away from home
(Lovelock and Lovelock 2013). In addition to this, the overseas visitors to United
Kingdom has spent around 19.7 billion pounds in the year 2016, staying away for
240 million nights. Around 1.6 billion day trips were being taken to the English
2

FUNDAMENTALS OF TOURISM, LEISURE, HOSPITALITY AND EVENTS
SECTOR
destinations in the year 2016 and the travelers spent around 53.5 billion pounds, in
total (Law et al. 2012).
Scenario Analysis
The overall decision of travelling gets influenced by several factors by various
factors, some of which are beyond the control of the policies and procedures. These
factors include; sensitivities related to the exchange rates, changing trends of
international countries and many more. Therefore, for giving indication to the
prospective alternatives in terms of the tourism, the country needs to increase their
share of visitors from the emerging markets. The other factor which affects the
country’s share of visitors is the change in the exchange rates. For instance; United
Kingdom captures a share from the visitors through emerging market economies, in
order to match their share with the European competitors (Lovelock and Lovelock
2013). However, this scenario projects that if an additional contribution of workers is
made, it will improve the tourism economy to a huge extent.
The Digital World
There are several factors which will continue to affect the tourism economy of
the United Kingdom for the next few decades, providing a mix of threats as well as
opportunities for the country. However, with the advent of digital world, the tourism
business has become quite effective and efficient. In order to become more
successful in the next decades, tourism companies must start investing a huge
chunk on this technology. Tourism and travel businesses must attract the travelers
by utilizing the most effective and efficient technology and setting the right price and
product. Furthermore, the companies must set new trends and promote the country,
in order to attract more and more visitors (Hanafiah, Jamaluddin and Zulkifly 2013).
3

FUNDAMENTALS OF TOURISM, LEISURE, HOSPITALITY AND EVENTS
SECTOR
In the near future, technology should be used more in order to understand
and segment the customers. In addition to this, the digital media can also be used to
offer and provide the new customers with more relevant options and choices. This
particular trend will help in understanding both the customer’s and business’
behavior (Everett and Slocum 2013). Furthermore, advancement in the digital
capabilities will help in driving more activities on the global scale, as the
geographical barriers do not exist anymore. Apart than these factors, with new
technologies, United Kingdom has more opportunities from the emerging markets as
well. The government of United Kingdom has recognized the long term growth
potential of the emerging markets in the next thirty years (Duffy 2015).
Future opportunities and trends
It is evident from leaked sources that United Kingdom has huge number of
opportunities in the area of tourism, which is both long and short term. This part of
the essay discusses about the future opportunities and trends, which can be
acceptable by the policymakers of the country. These factors will also help in
generating a greater impact on improving the performances of the United Kingdom’s
tourism industry (Janta et al. 2012). On the basis of the analysis, the areas on which
the investments are likely to be made are infrastructure, marketing and business
sector. Improving and maintaining the infrastructure of international as well as
domestic transport of the country will prove to be highly beneficial for sustaining the
overall strength of the tourism industry. Aviation policies should ensure that the
growth is sustainable environmentally (Canavan 2016).
Continuous support is also necessary for the business sectors in order to
leverage the opportunities like the usage of digital technologies, identifying the target
4

FUNDAMENTALS OF TOURISM, LEISURE, HOSPITALITY AND EVENTS
SECTOR
market and responding to the changes in the legislation. In addition to this,
continuous market efforts must be made in order to address the weaknesses as well
as build on the strengths. Improving the international perception of the United
Kingdom brand will assist in maintaining the position on the face of strengthening the
competition for the international tourists. There are huge opportunities for the country
to attract travelers from the emerging countries. Moreover, majority of the visitors still
continue to emerge from the traditional markets (Everett and Slocum 2013). This will
remain an important factor, which the country needs to focus on.
Current scenario
As per the latest available information, the country is going to spend huge
amount on improving their infrastructure in order to increase the number of tourists.
To be more successful in the next few decades, the tourism companies must invest
on technology which will yield better outcomes. The usage of technology will enable
the business sector gain an idea of the consumers’ changing preferences (Tribe
2015). Social media will help in maintaining the consistency of the brand and it will
open up new options for the travelers. Tools like, Trip Advisor, Twitter, Facebook and
others play an important role in the visitor’s pre departure research (Gössling and
Scott 2012). Therefore, more and more information is to be given in such sites for
adding up to the visitor’s knowledge about that place.
As per current estimation, the total contribution of tourism to the economy of
the country is approximately 32.4 billion pounds, which represents around 3 percent
of the Gross Development Product. In addition to this, the tourism industry supports
around 1.1 million jobs inside United Kingdom that is around 4.2 percent of the
overall employment. The country can expand their impact on tourism by including the
5

FUNDAMENTALS OF TOURISM, LEISURE, HOSPITALITY AND EVENTS
SECTOR
investments of supply chain, which accounts for around 6.4 percent of the Gross
Development Product. In this context, the tourism economy supports around 1.9
million jobs throughout rest of England. However, increased productivity of the
workers, in the tourism industry will help in increasing the overall contribution
(Tomazos and Cooper 2012).
Conclusion
In conclusion, tourism industry is estimated to contribute around 32 billion
pounds to the overall economy of the United States. The established markets
continue to constitute a major chunk of the visitors to the United Kingdom’s tourism
sectors. However, it is important to continue the trends of marketing so the country
does not lose its grounds here. On focusing on the past years, it is expected that the
country should keep using latest marketing tools in order to grab the attention of
more and more travelers. The country should also focus on the key elements which
are mentioned in this report. However, taking the current economic status of the
country into consideration, it can be easily said that the business will flourish in the
near future, if more digital strategies are implemented.
6

FUNDAMENTALS OF TOURISM, LEISURE, HOSPITALITY AND EVENTS
SECTOR
References
Canavan, B., 2016. Tourism culture: Nexus, characteristics, context and
sustainability. Tourism Management, 53, pp.229-243.
Duffy, R., 2015. Nature-based tourism and neoliberalism: Concealing
contradictions. Tourism Geographies, 17(4), pp.529-543.
Everett, S. and Slocum, S.L., 2013. Food and tourism: An effective partnership? A
UK-based review. Journal of Sustainable Tourism, 21(6), pp.789-809.
Gössling, S. and Scott, D., 2012. Scenario planning for sustainable tourism: an
introduction. Journal of Sustainable Tourism, 20(6), pp.773-778.
Hanafiah, M.H., Jamaluddin, M.R. and Zulkifly, M.I., 2013. Local community attitude
and support towards tourism development in United Kingdom. Procedia-Social and
Behavioral Sciences, 105, pp.792-800.
Janta, H., Lugosi, P., Brown, L. and Ladkin, A., 2012. Migrant networks, language
learning and tourism employment. Tourism Management, 33(2), pp.431-439.
Law, A., De Lacy, T., McGrath, G.M., Whitelaw, P.A., Lipman, G. and Buckley, G.,
2012. Towards a green economy decision support system for tourism
destinations. Journal of Sustainable Tourism, 20(6), pp.823-843.
Lovelock, B. and Lovelock, K., 2013. The ethics of tourism: Critical and applied
perspectives. Routledge.
Simão, J.N. and Partidário, M.D.R., 2012. How does tourism planning contribute to
sustainable development?. Sustainable Development, 20(6), pp.372-385.
7

FUNDAMENTALS OF TOURISM, LEISURE, HOSPITALITY AND EVENTS
SECTOR
Tomazos, K. and Cooper, W., 2012. Volunteer tourism: At the crossroads of
commercialisation and service?. Current Issues in Tourism, 15(5), pp.405-423.
Tribe, J., 2015. The economics of recreation, leisure and tourism. Routledge.
8