COVID-19 and the tourism and hospitality industry
How will businesses and destinations survive both amid – and after – the lockdown caused by the global pandemic
Professor Sheela Agarwal
Associate Head of School for Research and Innovation
Plymouth Business School (Faculty of Arts, Humanities and Business)
The iconic squares of Rome and Venice are empty. Barcelona’s Las Ramblas is eerily quiet. The Louvre, like so many other iconic venues in Paris, closed indefinitely. A picture of Europe in spring: barren boulevards, grounded flights, dry-docked cruise liners, vacant hotels, boarded up bars, and shuttered cafes and restaurants.
The streets of Barcelona are normally bustling with locals and tourists for much of the year
Taking its toll on tourism
The impact of COVID-19 on the tourism, hospitality and events industry has been nothing short of catastrophic. Government intervention in richer countries is helping to mitigate the worst effects, but for those developing or newly-industrialised nations, such as India, that cannot afford to subsidise businesses through social payments, the outlook is bleak.
With millions of people reliant on part-time, seasonal contracts, many families have had their livelihoods – their lives even – pushed to the very brink.
There is a very real and human urgency to recovering the tourist trade, to restarting the day-night economy, and large-scale events, far outweighing the desire to see westernised leisure pursuits return to normality. But how likely are we to see tourism and hospitality bounce back quickly? Differing views have been expressed by experts on the topic, perhaps best attributed to the uncertainty as to how COVID-19 will ‘end’. Some have suggested that it will disappear as quickly as it arrived; others are less optimistic. In the absence of a game-changing vaccine, they foresee the possibility of temporary lockdown measures continuing in areas where COVID-19 infections linger and where it re-emerges, and even the continuation of social distancing for at least a further 12 months in many countries.
In light of lockdown, restrictions on movement and liberty – combined with the toll that the situation is having on mental health and wellbeing – one might assume that people across the world will rush to travel and holiday at the first opportunity, post-crisis. In the developed world holidays, after all, are viewed as a basic need for personal recuperation, relaxation and wellbeing.
A legacy from past incidents
This forecast is reinforced by the legacy of other negative crisis and disaster events that indicate that people tend to have short memories where travel is concerned. Terrorism, for example, tends to have the shortest-lived impact, despite the terrorist’s objective to cause widespread panic and fear. It took London around six months to recover from the bombings in 2005 and 2007, and a similar amount of time for Paris, post-Bataclan in 2015.
The 9/11 terror attacks and the Madrid bombings could be measured as having an 18-month impact on tourism, mainly due to the severity of the event. But the world also looked at how New York handled the tragedy and copied many of its crisis management strategies – the public appeals for solidarity and unity, the commitment to maintaining ‘business as usual’, and the value of temporary global tourism recovery crisis committees, for example.
Both London and Paris evoked some of these actions, and there is little doubt that their efforts aided the recovery of the tourism, hospitality and events industry.
Continued cause for concern?
So, with COVID-19, the concern is that it will take much longer for the tourist sector to recover, with a legacy of caution over travelling to particular countries or participating in certain modes of travel, such as cruising or events. Companies will need to be prepared to employ overt mitigation measures if they want to regain consumer confidence – such as testing people before they embark on a cruise or a flight for example.
It is also likely to involve the implementation of ‘physical’ distancing through the reorganisation of service offerings to comply with government recommendations and to ensure that tourists and employees feel and are kept safe.
Facing an uncertain future?
This builds pressure on a sector that is already facing accusations from charitable social justice and environmental organisations such as Responsible Tourism and the former Tourism Concern, over appalling working conditions, its contribution to climate change and plastic pollution, and the impact this model of tourism is having upon overcrowding at popular destinations.
It is clear that the next two years will be a very difficult time for the tourism, hospitality and events industry. The lives of millions will be impacted, many irreparably so. Companies will fold, resorts and service facilities will face seismic change.
Even the notion of an immunity passport, which once seemed a little far-fetched, could potentially become a reality. It is hard to see much good coming from this.
The implementation of crisis management measures has, historically, been shown to aid recovery. After the appalling massacre of tourists at Luxor in 1997, for example, a tourist police force was established to help allay fears. Whether such a force is actually effective is a moot point – and the events at Sousse in 2015 suggest it’s not – but safety and security are pre-requisites for tourism, and they will underpin any effective recovery post-pandemic. How countries are responding, the perception that the virus is no longer active, and the media’s reporting of the incidence and management of COVID-19, will all feed into the process.
For many in the tourism sector, COVID-19 has brought further scrutiny and damaging publicity. Government bailouts of large airlines and cruise companies has been met with negativity in some quarters, particularly in the case of the latter, which has been somewhat exposed as a result of the apparently woeful on-board quarantine measures.
There has also been scrutiny of other unsavoury practices – the flying of ‘flags of convenience’ for example, with companies like Carnival registered outside of the United States and thus exempt from tax and labour regulations.
A distinct and different threat
With COVID-19, however, there is mounting evidence that the sector will not bounce back quite so easily because this pandemic is not like any that we have experienced in recent memory.The SARS health crisis was largely contained within Asia and although it devastated the lives of many families, its worldwide impact was relatively limited. This pandemic is global, with a much higher incidence of infection and mortality, and affecting nearly every country in the world.
And compounding that, is the fact that these countries are at different stages on the infection curve, and have varying institutional and medical abilities to respond to it.
Without a worldwide coordinated effort to support and help those countries in greatest need, we’re seeing global insularity, which in turn is hampering the supply of personal protective equipment and the chemicals needed for testing, especially for those countries unable to manufacture these products themselves.
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