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Tourism. Pessimism, optimism & back again.

Updated: May 24, 2021

As we race towards a winter of welcoming Aussie wallets, I’m wondering, what happened to all that fine talk about reshaping our tourism industry? Are we working on restoring environmental damage and wild places? Are we finding the ways to enrich, rather than impoverish our communities?

Over the last several months, I’ve moved from pessimism about the future of tourism through to seeing the potential of a collaborative, systemic approach to making it work as different projects have started identifying new pathways. But any optimism is very tentative.

The precovid success of our tourism industry was extractive – stripping value from communities, overseas workers and our environment. The result is most people no richer, but now with a hangover of environmental and community degradation. During covid, people and government talked reset and wanted to use the time and space to design something better.

Below I cover some of the relevant discussions, starting with productivity.

2011. Sir Paul Callahan speech: Strategy NZ Mapping Our Future. If you haven’t watched this. Youtube it and spend 20 minutes learning lots. This myth-busting speech delivers home truths about productivity in the tourism industry. Sir Paul calculated the revenue per needed employee to maintain GDP was $120K per job (don’t confuse this with what the employee is paid!) Tourism returned $80k per job, dairy $350K. Compare this with Apple, $1.3m per job. Tourism was taking us backwards about $40k per year, per job. Bluntly, tourism was making us poor. Dairy was better, but had other costs – particularly environmental.

April 4, 2021. 10 years after that original speech, blogger Rowan Simpson revisited the speech and had a look at our progress over that 10 years. Not pretty. Really, it’s got worse, we are now one of the hardest working nations in the developed world earning pretty much the least output per hour worked. Attempting to pick winners in our tech sector hasn’t helped. But then Rowan raises the possibility that maybe Sir Paul got a few things wrong?

18 March, 2021. Parliamentary Commissioner for the Environment Simon Upton gave an address at the Otago University Tourism Policy school. He was following up on his 2019 report; Pristine, popular… imperilled? with a set of recommendations in a new report called Not 100% but four steps closer to sustainable tourism. You can read the reports or go straight to his powerpoint and speech notes handily uploaded to the PCE news and insights page. His first of four solutions was to impose a serious departure tax on all people leaving NZ – the money raised to be split between financing (part) and international project to explore more sustainable fuel options for plans and to supporting climate change options for our Pacific Island neighbours.

Back to December 2020; The Tourism Futures Taskforce releases its interim report – Government sat on this for some four months, so we only caught up with this in April. It’s a good read, hopeful, a systemic approach. Rod Oram called it “brave, thoughtful and inspiring” in his Newsroom article.

Fast forward April 28, 2021. A late night text; would I like to do an article for Mountain Scene? Of course, thinking I could drum up some interest in our ORC Long Term Plan. Realising that publication would be too late, I changed course. (Although it’s not too late as it turns out. If you’d like more info about that, we will accept late submissions – get in touch.)

The Tourism Futures Task Force invested in a worthwhile broad, systemic introspective into the industry. The result is a thoughtful, well researched roadmap, using known and proven frameworks for sustainable development and collaborative partnerships. If, just if we follow it, all of it, we just might move tourism from being yet another extractive industry, to one that can nurture people and environment delivering on our four wellbeings as well as our treaty partnership. We just might be ready (she whispers, very gently).

The task force has challenged the Sir Paul tourism productivity figures quoting a Tourism NZ report – Te Ohanga which puts output per tourism employee in the core tourism business at $201,424 (this compares with the non visitor economy output of $213,278 – so still lower than many sectors). The results aren’t so good for the supporting industries, so many of which are small businesses – these sit at $120,775 per full time employee – this is way too low and will be taking us backwards. However, these measurements are substantially better than those quoted by Paul Callahan – even allowing for the 10 year difference.

So, if the productivity isn’t as bad as it looks, why is more of this income not filtering into our communities? Why do many of our big tourism companies still only pay minimum wage and pat themselves on backs if they pay ‘living wage’ – which frankly, is still minimal if you’re trying to pay a mortgage or rent in this area. The report acknowledges and addresses all this. It talks of inefficient pricing, the need to deliver more income to both local and central government for more distribution to achieve the wellbeings. It talks of misunderstood and irrationally priced supply chains – that is the leases, concessions and other somehow enabled access to the public domain and takes in info from many sources including a lovely piece of qualitative research from Tourism NZ that explores how New Zealanders feel about tourism in their own country.

There is a lot I like about the taskforce recommendations, but it will be a hard sell to the short-term-interested companies precisely because it is a systemic approach requiring all identified recommendations to be enacted. And there’s a plausible transition plan.

Simon Upton’s report both informs and fits within the task force report, just as it should in a collective approach.

And the timing just might be right. Elsewhere the thinking is happening. Back to Life is a regenerative tourism course with participation from many of Aotearoa’s Regional Tourism Offices, including the two from our region and some of our council staff. Then there’s other serious restorative activity underway; Mana Tahuna employing people in environmentally restorative activity, WAO Wanaka generating ideas and projects, Wai Wanaka bringing a collective approach to restoring water catchments.

My pessimism dissipated, maybe there is hope afterall?

However, the Task Force is clear that we follow it all, or not at all. But somehow our government has missed that message and has stood down the task force, cherry picking some actions rather than committing to the big, systemic change this industry needs.

Shame. Pessimism returns.

Back to Sir Paul’s exhortations to invest in innovation. Maybe innovation can underpin our tourism industry? Maybe it’s worth investing in tourism instead of houses? I don’t know if any other country has taken such a thoughtful and integrated systemic approach as the tourism taskforce. If they have, world tourism will improve. If they haven’t omg, we’ve got a leap on them. That’s the thing about a systemic approach, win win if you follow it.

My hope now is that the tourism industry itself picks up this report and instigates the actions including pressuring government for the necessary regulatory frameworks. It will need to, otherwise, business as it was will soon return.

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