Tourism accounted for a quarter of the jobs created since 2013 — but mass-tourism of this type brings its own problems.
One of the main motors behind Spain’s recent economic recovery, foreign tourism, is beginning to splutter. After years of two-figure year-on-year growth, the number of foreign visitors to Spain in the first five months of 2018 grew by a paltry 2% (to 28.6 million tourists). During the same period last year, the year-on-year increase was 12%. More ominous still, the country’s two biggest tourist markets, Catalonia and the Canary Islands, actually saw visitor numbers fall from January to May for the first time since Spain’s tourist boom began.
This could spell trouble for Spain’s broader economy. The tourist industry provides around 13% of economic output. That’s two-and-a-half percentage points larger than the contribution of Spain’s construction sector at the peak of Spain’s mind boggling housing boom in 2007.
Tourism has played a vital role in Spain’s economic recovery, accounting for around a quarter of the new jobs created since 2013. The impact on Spain’s biggest tourist regions such as Catalonia, the Canary Islands, and the Balearic Islands has been even more pronounced, with over a third of the new jobs created there since 2013 depending on tourism.
Spain’s spectacular tourism boom is largely the result of a trend that is both externally driven and transitory in nature: The surge a few years ago in geopolitical risks affecting rival tourist destinations like Turkey, Egypt, and Tunisia. According to research by UBS, more than half of the growth of Spain’s tourist industry can be attributed to the drop-off in tourism in places like Tunisia, Turkey, and Egypt.
Now, that trend is beginning to reverse…