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Hospitality

Tourism Industry Headed Toward Red-hot Summer, Trends Suggest

By Johanna F. Still, posted May 6, 2022
Room occupancy tax collections in New Hanover County are already trending ahead of 2021 figures, which were record-breaking. (Photo courtesy Adam Jones)

The pandemic is in the past – at least, that’s the mantra of the Wilmington and Beaches Convention & Visitors Bureau. “We’re looking beyond the pandemic,” said Kim Hufham, New Hanover County Tourism Development Authority president and CEO. “We don’t even want to mention that word really.”

The dips the pandemic initially brought the tourism industry have turned into new summits that experts predict will peak again this summer. A nationwide recipe of pent-up demand and pocket cash will bring an anticipated windfall into the Cape Fear region – so long as the hospitality industry can maintain the workforce to keep up. 

Last year, tourism spending was just 1% shy of 2019’s record-breaking level across the state, according to data shared by the N.C. Department of Commerce earlier this week. Visitor spending contributed $28.9 billion to the state’s economy in 2021, supported by a tourism workforce of 197,500, which is still 18% below pre-pandemic levels. 

County-level data for last year won’t become available until August, Hufham told the audience of the Wilmington and Beaches Convention & Visitors Bureau’s Travel Talk on Thursday, held to coincide with National Travel and Tourism Week. Without 2021 figures, Hufham shared the latest data from 2020, when New Hanover County logged $598 million in tourism expenditures, supporting 5,455 jobs, generating $51.5 million in state and local taxes, while saving each county resident $218.66. 

This was the first time Brunswick County surpassed New Hanover’s spending, Hufham said; Brunswick netted $731 million in 2020, representing just a 1% pandemic-induced drop from the prior year compared to New Hanover’s nearly 23% dive. 

New Hanover gained more in visitor spending than Forsyth (Winston-Salem) for the first time, Hufham pointed out. Given room occupancy tax (ROT) collections last year, Hufham said she expects the new tranch of 2021 visitor spending figures to be record-breaking. 

ROT collections in New Hanover County in 2021 were up about 60%, bringing in a record-breaking nearly $18 million, which funds beach renourishment, visitor-related amenities, ocean rescue programs and more. 

UNCW regional economist Adam Jones began his keynote address with a slide featuring photos of a dumpster fire, representing supply, and shoppers on Black Friday, depicting demand. “Supply is a mess and demand is outrageous,” he said. This combination has fueled inflation, which has climbed amid record-low unemployment rates and unprecedented bargaining power among the labor force.

Pointing to ROT collections so far this year (January’s figures were up 40% over January 2021), Jones said the trend suggests this summer will see an even deeper surge in tourism demand. “That means every day is Black Friday in Southeastern, North Carolina,” Jones said. “The rush is coming.” 

With workforce constraints, how will the hospitality industry handle the incoming rush? Jones presented a generational overview of current labor dynamics: Society has transitioned from a goods economy into an experience economy. This has bled into the workplace as individual-focused millennials have aged, which is also perceived as a consumable experience, Jones said. “Work is consumption as well,” he said. 

Research suggests at least 20% of an individual’s work should be fulfilling or enjoyable in order to keep them satisfied, Jones said. To help employers attract and retain workers, Jones suggested employers should be flexible and cater the work experience to meet individual needs.

“Increasing pay is only part of the solution,” he said. “We need to mentor them, not manage them.” 

During a panel discussion of industry leaders, most agreed that finding workers was the top struggle heading into the summer season. ​

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