Tourism boosts California economy

The California travel industry continues to reap the benefits of a rebounding economy as figures for 2005 reflect an upswing in direct travel spending. Tourism Continues to Boost California Economy in 2005; New California Travel Statistics Show Upswing

Total spending in California from visitors was $88.1 billion in 2005, an increase of 7.6 percent from 2004 and the third straight year of positive growth, as well as the largest gain since 2000.

“California is one of the world’s premier destinations,” California Travel and Tourism Commission (CTTC) Executive Director Caroline Beteta said. “These numbers attest to the success of the travel industry and its significant impacts on California.”

The 2005 report, compiled by Dean Runyan Associates, illustrates the economic impact of travel in California. Air travel played a pivotal role in the increase. There were 29.8 million domestic air passenger visitor arrivals to California airports last year, up 2.6 percent from 2004. This exceeds the number of arrivals in 2000, the previous high.

During 2005, travel spending directly supported 911,800 jobs (up 5.4 percent from final 2004 figures) with earnings of $28.0 billion. Travel spending generated the greatest number of jobs in arts, entertainment and recreation (229,100 jobs), food service (263,300) and accommodations (202,900).

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Visitors that stayed overnight in paid accommodations spent $46.7 billion in 2005, or 57 percent of all visitor spending in the state. According to Smith Travel Research, California lodging occupancies averaged 69 percent statewide in 2005, 3.8 percent over 2004 and 9.4 percent above the U.S. average. Revenue per available room averaged $70.65, an increase of more than 10.1 percent over 2004. International visitor spending comprised more than 16 percent of all travel spending in the state.

Travel spending in 2005 generated $1.9 billion in local taxes and $3.4 billion in state taxes. In 2005, every $100 of travel spending generated $31.74 of earnings, $2.19 of local tax revenue and $3.82 of state tax revenue.

The full report, California Travel Impacts by County, Preliminary Estimates will be available this month online at http://www.visitcalifornia.com/ . Copies will also be distributed at the California Conference on Tourism scheduled for March 27-29 in Anaheim.

The CTTC, with D.K. Shifflet Associates, Ltd., is projecting a modest growth in 2006 visitor numbers, with travel to and through California during spring expected to sustain the approximate growth of three percent as seen in 2005, and then begin to taper off through summer months. According to the Travel Industry Association of America, leisure travel volume is forecasted to increase two percent in 2006, compared to four percent in 2005, while international travel to the United States will increase more than 5.5 percent. The growth in travel spending by domestic and international visitors is expected to increase a more modest 4.4 percent in 2006 to $674 billion. Business travel volume is expected to increase 1.6 percent increase in 2006.

Japan and China are two of California’s most important international markets in 2006. According to the Japan Travel Bureau, a record 18 million Japanese plan to take international trips in 2006 due to continued economic growth, improved corporate profits and increased disposable income. With 31 million in outbound tourism in 2005 and an expected 100 million predicted in 2020, China has huge revenue potential for the U.S.

The CTTC is a non-profit organization with a mission to develop and maintain marketing programs—in partnership with the state’s travel industry—that keep California top-of-mind as a premier travel destination. California is currently the number one travel destination in the country
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