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Staycation boom benefits UK more than other countries

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The switch to “staycations” will have boosted Britain’s tourism sector more than that of other countries, according to new analysis published as the industry welcomed a government decision to relax restrictions on inbound travel.

From Monday, fully vaccinated travellers from the US and EU will be able to enter England without having to quarantine — giving airlines, hotels and tour operators hopes of salvaging at least part of a second dismal summer season.


The announcement of the change boosted shares in the airlines easyJet and Ryanair and the travel caterer SSP, while Claire Walker, co-executive director at the British Chambers of Commerce, said it would be welcome news “for the hundreds of thousands of people directly employed in the travel industry and the many more that are part of supply chains”.

From airlines to travel agencies, visitor accommodation to car rental, businesses associated with tourism have been among the hardest hit by the pandemic, with the number of hours worked falling far more than in the overall economy, and many jobs still supported by wage subsidies in May.

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But the Resolution Foundation, a think-tank, said in a report published on Thursday that “while it may not feel like it to those struggling to fill bars and beds”, conditions were not as bad as they might be because the UK had been far better placed to benefit from the pandemic-related swing towards domestic tourism.

In a “normal” year, the UK has a “tourism trade deficit” of some £30.5bn, the Resolution Foundation said — with British people spending far more on overseas holidays than overseas tourists spend in the UK, in contrast with the huge tourism surpluses of countries such as Spain and Greece.

This means that if all tourists across the world replaced their foreign holiday with a trip in their own country, annual spending on tourism in the UK would rise by a sixth — implying the creation of an extra 300,000 jobs.

In reality, however, the new popularity of “staycations” — with web searches for camping trips outstripping searches for cheap flights — is not enough to compensate for the larger numbers who have simply chosen to stay at home.

The UK’s labour force survey suggests that employees failed to take almost a fifth of their usual leave allowance last year, the Resolution Foundation said — possibly because they were hoarding it until better travel options opened up.

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Overall tourism activity has fallen sharply across the EU, with Eurostat figures for the last summer season showing nights spent in tourist accommodation by visitors from another country were less than half their 2019 level, while bookings from domestic visitors were down 12 per cent.

In the UK, the benefits are unevenly felt, with coastal and rural areas such as Devon, Cornwall and Cumbria inundated, while hotels in London and cities popular with overseas visitors stood empty.

Nye Cominetti, senior economist at the Resolution Foundation, said staycations would provide “some much-needed relief”, but there were still “huge challenges” for the industry and the two million workers employed in it as the summer ended and the furlough scheme wound down.

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