Region’s tourism ‘perfect storm’

News

Coronavirus has wreaked deep and wide damage on the Geelong region’s visitor economy.

The Geelong economy’s $1.1 billion visitor and tourism sector comprising more than 2,600 businesses is on its knees, needing ongoing support to survive and then to rebuild post COVID-19.

Tourism Greater Geelong & The Bellarine says significant and long-lasting impacts have already hit 60 per cent of the directly employed tourism workers across wider Geelong.

Restaurants, cafes, pubs, cocktail bars, hotels, B&Bs, live music venues, wineries, commercial tourist attractions, holiday parks and accommodation have all struggled to stay above water financially.  The recent state border and Melbourne metropolitan lockdowns are a further blow.

Prior to the pandemic that sector of the economy employed 7,500 people directly — representing about 7 per cent of the total economy — and a further 3,700 indirectly.

Business closures have seen an estimated 2,190 jobs lost in wider Geelong within the accommodation and food services industry and about 2,300 people resorting to JobSeeker.

Three of the top five industry sectors impacted by COVID-19 in Greater Geelong made up 26 per cent of the area’s $1.1 billion visitor economy in 2019.

Recent data shows accommodation and food services are by far the hardest hit in 2020, resulting in a combined loss of $127 million for the June quarter alone.

Other sectors with a significant impact on the tourism industry include retail and the arts, recording losses of $87 million and $67 million respectively across wider Geelong for the quarter.

Great Ocean Road Regional Tourism predicts that region will see job losses in 2020-21 of between 4,700 and 6,330 based on best and worst-case scenarios.

The visitor economy is a significant contributor to that region, with 18 per cent of jobs directly and indirectly dependent on visitations. The industry represents more than 1900 tourism businesses; 1200 employing businesses and some 700 micro businesses.

The recent reimposition of movement restrictions on metropolitan Melbourne in response to second-wave outbreaks and the closure of Victoria’s borders are significantly restricting visitor volumes to both regions.

Just as many businesses across Australia are reopening the current lockdowns in Victoria threaten mass business closures, lost income and significant further unemployment in the state.

The federal government has supported the nation’s visitor economy through programs like the increased investment in the Export Market Development Grants Scheme, Boosting Business Cash Flows and JobKeeper.

The state government too has provided support packages, including for the music industry to support musicians and industry workers who have lost gigs, income and employment as a result of the pandemic.

G21 welcomes the federal government's recent announcement of a continuation of JobKeeper payments beyond September, albeit at a lessor amount and with revised eligiblity criteria.  JobKeeper has been the key factor in allowing many visitor-based businesses to survive through the first half of the year.

Sadly, while many employees from the hospitality and music sectors have qualified for JobKeeper, or JobSeeker, many others are not eligible due to the nature of their casual employment which is common within the sector.

The likely cessation of JobKeeper next year, the resumption of loans and mortgages which have been temporarily placed on hold and ongoing lockdowns within Victoria are looming as a visitor economy ‘perfect storm’ for this region which depends to a large degree on tourism.

This situation within our region is amplified for those businesses geared towards the international travel market. With national borders virtually closed and unlikely to reopen until at least well into 2021 the future of those businesses is bleak.

Our vital tourism sector and its employees need continuing support to survive now, in order to give them a fighting chance of recovery in the medium term. JobKeeper has been the key factor in allowing many visitor-based businesses to survive through the first half of the year.  However, the revised nature of JobKeeper may not fully take account of the specific challenges facing regional Victoria's tourism sector.

G21 thanks the federal and state governments for the existing support to the tourism sector while urging them to consider further specifically-targeted assistance for Victoria’s hard-hit regional visitor economy.