Recent examples

Global changes in the tourism industry can dramatically affect Sydney Harbour YHA's visitor numbers and revenue. Some recent global changes that have directly affected the hostel include:

• Global recessions affecting discretionary spending on travel. There was a change in the types of visitors staying at hostels during the global financial crisis. The economic impacts of the Covid-19 pandemic have been severe and continue to develop.

• Changes in international exchange rates making travel to Australia cheaper or more expensive depending on the tourist source country.

• The Federal government's Australian Tourism Authority marketing campaigns to promote Australia as a tourist destination. For example Australian government advertising campaigns in China have seen an increase in tourists from this source, however recent political tensions between the two countries may affect travel plans in the future.

• International events attracting tourists to Sydney, such as Vivid and the Sydney Mardi Gras, major sporting events like the Rugby World Cup or Sydney's famous New Years Eve celebrations. Due to its location and rooftop views, the hostel is heavily booked during the New Years Eve period each year.

• Federal government changes to working holiday visa rules https://immi.homeaffairs.gov.au/visas/getting-a-visa/visa-listing/work-holiday-462 . The Working holiday makers tax, known as the 'backpacker tax', is an example of political decisions that affect the tourism industry at a local scale. This tax, which came into effect from January 2017, had a bigger impact on working holiday visitor numbers than the GFC in 2008. During the campaign to reduce the tax rate, a YHA spokesperson noted that tourists were preferring New Zealand, Canada and South Africa ahead of Australia after the tax was introduced. The tax continues to be contested - it was recently challenged overturned, but then reinstated. Find out more about the https://www.smh.com.au/national/tax-office-win-in-overturning-backpacker-tax-ruling-20200806-p55j5m.html?fbclid=IwAR1994Q2hYLT1gPAWYLXM8KOiBMABIcmq8H03KwD16E0ASoHef6Hx3D6M6g .

• Natural disasters, such as the 2019/20 bushfires, discouraged international tourists. As part of the recovery process, Tourism Australia launched the 'Holiday Here This Year' campaign to encourage domestic tourism ( https://www.tourism.australia.com/en/about/our-campaigns/holiday-here-this-year.html ) which has been extended through the Covid-19 pandemic. YHA has built on this campaign with their 'Stay Local' and 'Stay Safe' promotions: https://www.yha.com.au/travel-and-tours/travel-australia/

Covid-19 Pandemic

In 2020 the most significant global impact on the YHA hostels network has been the Covid-19 pandemic. Sydney Harbour YHA has been severely impacted in the following ways:

• Federal government international flight ban and State border closures

Due to the strict international border restriction and lock-down measures, international tourism has dropped to very low levels. Sydney Harbour YHA overnight stays have decreased to less than 25% occupancy in comparison to previous years, with a corresponding impact on revenue.

• Implementation of Covid-19 safe arrangements

Following government instructions and guidelines for businesses, Sydney Harbour YHA has introduced Covid Safe guidelines and procedures. See the Stay Safe with YHA video and further information: https://www.yha.com.au/hostels/covid-19/

• Workforce impacts

The Sydney Harbour YHA has changed and adapted its staffing. Key operational full-time and part-time staff positions have been retained with assistance from the Australian Government as part of the JobKeeper Payment Scheme and the hostel has remained open to guest stays. Many casual staff, including those on working holiday visas, have left the hostel to return to their home countries.

• The Big Dig Archaeology Education Centre

Due to the NSW Department of Education ban on school excursions, bookings of the Centre's programs stopped in March 2020. The Big Dig programs offered at the centre are run on an at-cost basis and presented by the guides team at Sydney Learning Adventures, the educational unit of Place Management NSW (NSW Government). The Big Dig programs have been adapted for online delivery until such time as excursions to the site can resume.

Impact of Covid 19 on Australia in 2020

ABS data shows arrivals to Australia dropped 60% in March, the largest ever drop in overseas travel as the impacts of Covid -19 spread worldwide.

In March there were 331,000 short term visitors to Australia, compared to 836,000 in March 2019.

In April 2020, overseas arrivals to Australia fell 99% due to Covid-19 travel restrictions. Border controls resulted in just 22,000 arrivals through April, more than two thirds of whom were Australian citizens returning home from overseas. Just under 7000 were foreign citizens.

As of August 2020 Victoria is in lockdown again, and borders are tightening severely effecting the movement of people. The future of tourism in Sydney is uncertain.

Impact of Covid 19 globally in 2020

United Nations World Tourism Organisation UNWTO data for January – March, shows globally, international tourist arrivals dropped by 22% with arrivals in March down by 57% following the lockdowns, travel bans and border closures implemented by many countries including Australia. This represented a loss of 67 million in international arrivals in the first quarter of 2020 compared to the same period in 2019. The economic impact of the downturn resulted in a US$80 Billion hit in terms of lost exports.

Find more updated statistics at https://www.unwto.org/international-tourism-and-covid-19

Currently the WTO estimates the full year impact of the pandemic could be a decline of 60-80% in terms of international arrivals compared with 2019. This would result in a decline of between 850mill – 1.1billion tourist arrivals costing US$910 billion to 1.2 trillion in lost revenue export. This loss compares with a 0.4% decline during SARS in 2013 and a 4.0% drop in 2009 following the global financial crisis.

Source:

Grant Kleeman – GTA Global Tourism Update

United National World Tourism Organisation (UNWTO)

Australian Bureau of Statistics (ABS)