UK Tourism Industry Report: Growth, Challenges, and Future Prospects

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UK
Touris
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“Travel makes one modest.
You see what a tiny place
you occupy in the world.”
UK Tourism

About UK Tourism
The United Kingdom which comprises of four
parts including Scotland, England, Northern
Ireland and Wales is located in the Northwester
part of the continent Europe. It is an island nation
having London as its capital city which boasts for
its contribution of world literature, financial
markets, history and culture (Medlik, 2016).
People all around the world are known to visit
this culturally rich country for a variety of
attractions (its infrastructure being one of them).
According to the data which was collected and
analyzed in 2018, the United Kingdom occupies
the globe’s sixth largest tourist destination
position. It is recorded that only in the year 2018,
around forty million people (this figure was thirty
six million in the year 2016) from across various
countries visited United Kingdom for tourism
purposes (Moutinho, 2018). This is the prime
reason why the royal country considers tourism to
be one of its key industries. Through various
forms like direct, indirect and induced forms,
United Kingdom was able to contribute around
7.6 trillion to the global travel industry. In 2016,
the worldwide impact of this industry was US
$2.3 trillion with relation to transportation,
accommodation and entertainment.
The United Kingdom
tourism is one of the
largest employment
providers of the world
providing employment to
around two million people
(Raj, 2015). “Travelling – it leaves you
speechless, then turns you
into a storyteller”
 Ibn Battuta

Reasons to encourage growth of
tourism in the United Kingdom
There are a range of reasons why tourism needs
to be encouraged in the United Kingdom. A few of
these are mentioned below (Page, 2017)–
 It is a great source of income to the United
Kingdom government. Approximately this
industry generates one hundred and six
billion euros per annum. This is a great
contribution to the country’s Gross
Domestic Product (GDP).
 It provides employment to a range of
individuals and firms in the form of travel
guides, travel offices, etc for the citizens
of the United Kingdom. As mentioned
earlier, around two million people are
working currently in this industry.
 Their cultural history is praised by all the
visitors of the country and hence this is a
great way to present the rich heritage of
the nation in front of the world.
 This indirectly leads to the increase in
contribution of related industries due to
tourism. For instance, retail sector (due to
shopping of tourists), car parking costs,
etc are also a source of revenue though
cannot be attributable to tourism directly.
 It is a clear source of foreign exchange
earnings.
 Worldwide appreciation of the local
culture motivates local residents to feel
proud of their identity and brings them
closer to their own culture.
 This leads to development of
infrastructure be it tourist attractions or
places to stay.
 The overall country’s image is boasted in
the minds of the tourists who hail from
different parts of the world, who is
impressed will go back and speak high
about United Kingdom.
 Leads to greater
connectivity and
ensures that people
across geographical
boundaries have an
opportunity to meet
and get acquainted.
 This also indirectly
contributes to the
introduction of
better technology
and other
advancements.

PESTLE Analysis of the UK
Tourism
Any particular firm or an industry would be exposed to
a range of factors which affect them (both in a positive
fashion as well as in negative fashion). Such influences
can be broadly divided into two categories namely –
micro variables and macro variables. Micro variables
are those which are limited to a particular firm or a
business entity. Since here we are concerned about
the United Kingdom Tourism Industry as a whole, only
macro variables would be relevant. Out of the many
models suggested by famous management experts,
PESTLE analysis is believed to be the best way to
analyse the external environment of an industry. The
effect of external factors of an industry is analyzed by
grouping them into six blocks – Political, Economic,
Social, Technological, Environmental and Legal
factors. By doing this, the management of any tourism
company or the government officials of UK are
equipped with more knowledge regarding the present
conditions and the probable future conditions that the
industry might face (Crick, 2018).
Political factors affecting the nation’s tourism would
be very limited yet important. Government instability
can question the amount of tourist visas being
granted. Extreme instability can also lead to tourists
feeling unsafe in the country. For instance, a
nationwide political strike can lead to closing down of
all tourist attraction spots and shopping venues. A
general political unrest can also affect the country’s
brand image with regard to tourism and reduce the
amount of tourists flying in.
The economic factors affecting tourism would
primarily be around the foreign exchange fluctuations
of the United Kingdom currency. If such a foreign
exchange difference is extremely volatile and the gap
is huge, people would decide to
go to places which are economically beneficial to
them rather than to a nation which is extremely
costly for them. But it is a known fact for many
foreigners that United Kingdom currency is
exponentially higher than them and yet prefer to
visit the place.
Social Factors are the demographical factors with
relation to the local people of the country. Since
people of the United Kingdom have always been
open to the idea of living together, they wouldn’t
identify tourists to be aliens. Though traces of
racism and related discrimination is still prevalent in
some parts of United Kingdom, the influence of this
on tourism is limited.
Technological Factors affecting the sector would be
the new advancements in the industry like online
booking of places to stay, use of mobile applications
like Airbnb which introduced the travel community
to home stays, etc (Richards, 2016).
Legal Factors would imply the various acts and
policies which apply to the tourism in the United
Kingdom. The concerned act here is The
Development of Tourism Act 1969.
Environmental factors include a variety of variables.
For instance, any occurrence of natural disasters or
for say human made disaster might lead to reduction
of the number of tourists deciding to visit the place.
An environmentally responsible country would
always be one which is cleaner and greener.
SWOT analysis is another important management
tool which is used to analyse a particular industry
from all four perspectives and help the managers
have an appropriate vision for the future.
The strengths of the United Kingdom tourism
industry would be its great ancient heritage,

attractive infrastructure, economically sound, safe
atmosphere for tourists, one of the greener nations,
availability of skilled people for employment, etc.
Weaknesses of the United Kingdom tourism industry
would include seasonal demand which means tourists
flock during a particular season while it is completely
deserted during the other season.
Opportunities are in plenty for this industry. I believe
they can invest further in building infrastructure
which supports today’s adventure tourism then only
relying on ancient history and its value. Concentrating
on domestic tourism would also be a great opportunity
for it to increase its revenue.
Threats would primarily be the inflow of tourists to the
world’s largest tourism hub – United States of
America. Not only the United States, but there are
many other countries which occupy the first five places
of world’s largest tourism hubs. Growing competition
between these nations is a threat which United
Kingdom will have to fight with (Ateljevic, 2017).
Brexit and its impact on UK Tourism
Brexit refers to the exit of the Great Britain from the
European Union. Such a historical decision has a great impact
on the tourism industry of the United Kingdom. Some of
which include (Liu, 2016) -
 The fall in the pound value as made travel to the
United Kingdom more affordable to foreigners and
at the same time this made travel abroad more
costly to the local citizens.
 For all non-EU tourists, it becomes difficult to use
United Kingdom as a gateway to the other EU
countries.
 The funding which earlier flowed in from the
European Union to develop the UK tourism comes to
a hault.

REFERENCES
 There is an increase in cross border
regulations with respect to visa
requirements.
 It is unfortunate to note that most of the
United Kingdom Tourism Industry
Employees hail from European Union
Countries, and this means that they might
have to compromise on their jobs due to
Brexit.
Globalization of hospitality and
Tourism industries
Globalization refers to the idea that the whole
world is a global village where everything
needs to be connected. By globalizing this
industry, all countries will be open to
maintaining global standards of hospitality and
Tourism. This ensures that tourists across
globe are welcomed into different countries
and are treated with dignity. This also leads to
greater connectivity and cultural transfer
among the people of the world. Each country
will be uniquely known to others and its
culture will be highly respected.
 Ateljevic, J. and Page, S.J. eds., 2017.
Tourism and entrepreneurship. Routledge.
 Crick, D., Chaudhry, S. and Crick, J.M., 2018.
Risks/rewards and an evolving business
model: A case study of a small lifestyle
business in the UK tourism sector.
Qualitative Market Research: An
International Journal, 21(2), pp.143-165.
 Liu, Y., Sun, X. and Wang, R., 2016, April. A
critical review of Asia’s emerging middle
class be of benefits to the UK tourism and
hospitality industry. In International
Conference on Education, Management and
Computing Technology (ICEMCT-16).
Atlantis Press.
 Medlik, S. ed., 2016. Managing tourism.
Elsevier.
 Moutinho, L. and Vargas-Sanchez, A. eds.,
2018. Strategic Management in Tourism,
CABI Tourism Texts. Cabi.
 Page, S.J., Hartwell, H., Johns, N., Fyall, A.,
Ladkin, A. and Hemingway, A., 2017. Case
study: Wellness, tourism and small business
development in a UK coastal resort: Public
engagement in practice. Tourism
Management, 60, pp.466-477.
 Raj, R. and Griffin, K.A. eds., 2015. Religious
tourism and pilgrimage management: An
international perspective. Cabi.
 Richards, G., 2016. Cultural tourism. In
Archaeological Displays and the Public (pp.
1-11). Routledge.