Tourism to contribute 5.8% of global GDP in the next decade
31-12-22
The effects of the pandemic have altered the way we travel. Today, travellers are more concerned about their travel choices. In the wake of the pandemic, several trends have emerged, such as working holidays, staycations, coworking spaces, etc.
The report "Hotel in 2032" by Noesis Capital Advisors, India's leading hotel advisory firm, provides information on an overview of the global hotel industry and current and future hotel trends over the next decade. It also includes some exquisite analysis of the hospitality market by industry leaders.
According to the "Hotel in 2032" report, between 2022 and 2032, travel and tourism will contribute to the global economy at an average annual rate of 5.8%, which is more than double the 2.7% average annual growth of the global economy.
By the end of 2022, the sector's contribution to the global economy is expected to increase by 71% in the Asia-Pacific region, thanks to increased domestic spending and the return of foreign tourists.
Among the countries expected to experience a large increase in foreign visitor arrivals are Malaysia, Japan and Australia. By the end of 2023, the Asia-Pacific travel and tourism sector is expected to reach pre-crisis levels. However, it is subject to whether major source markets such as China and Japan continue to impose restrictions on international travel.
Millennials and Generation Z are driving change in the hotel industry and it is important to understand their expectations. Incredibly tech-savvy and adaptable, Generation Z (born between 1997 and 2012) is driving changes in travel preferences in this digital age.
For this generation, four out of five methods of planning a trip are online channels; therefore, a shift from multi-channel marketing to omni-channel marketing will be more effective.
Consequently, the hospitality industry must adapt to this evolution. This generation is the first digital native; they value experiences more than things/material objects, giving rise to trends such as staycations and workcations.
Staycations (holidays at home that do not involve a lot of travel) are estimated to be 15% more profitable than traditional holidays that involve travel. According to the NOESIS survey, 84% of industry executives expect staycations to be a recurring trend over the next decade.
People are attracted to these trends because staycations offer convenience, less planning, specific activities and less risk of cancellation.
The report also explains how working from home has become working from anywhere, giving rise to the Workation trend. According to a survey, 62% of employees believe that working remotely increases their productivity.
Another emerging trend is coworking spaces, where employees from several companies share space, providing a sense of community, creativity and flexibility. This market has a growth rate of 14.8%, with an estimated value of $24 billion by 2030, and even hotels are taking advantage of this trend to expand and utilise the space available to business travellers, offering services such as robust WIFI infrastructure, food, stationery and workspace during the day.
One of the many hotels that have adopted the coworking model is Roseate Hotels and Resorts. The report details many other interesting aspects, such as technology, dynamic workforce, subscription-based services, etc. Subscription-based services are the result of the current trend towards remote working for those seeking an "office away from home".
On the other hand, the catering market is expanding, and hotels can benefit from subscription food delivery services, especially for today's generation Z, who demand a very personalised service.
The Indian Hotels Company Limited (Taj Hotels) launched "Qmin", its online food delivery and culinary platform, just three months after the start of the pandemic, and is now present in more than 20 cities across multiple platforms. The global market for online food delivery services is expected to expand rapidly at a steady annual growth rate of 9.8% and the current global market valuation is $38.2 billion.
One of the most recent trends in the wake of the pandemic is the need for the hospitality industry to focus on a dynamic workforce, where the expectations of Generation Z go drastically beyond what an entry-level hotel apprenticeship can offer.
Lower wages coupled with unpredictable working hours and night shifts on weekends, neither of which are particularly attractive to a recent graduate. According to the World Travel & Tourism Council, the sector is expected to generate 126 million new job opportunities between 2022 and 2032, with the Asia-Pacific region generating 76.9 million of those opportunities, as well as 64.8% of all new travel and tourism jobs globally.
The report makes some recommendations, such as allowing flexible working hours and telecommuting, offering rewarding jobs, attractive employee benefits and expanding career options within the sector.
The study also highlights the importance of crucial design changes in the modern hospitality industry. In the coming years, the sector will see a "hypoallergenic room concept, with improved HEPA filter technology".
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