Sign up for Travel News


 
  • 11.01

    TroonFIT Running on the Links Series 4
    more

  • 11.09

    Craig Einhorn
    more

  • 11.09

    Behzod Abduraimov, piano
    more

Full Event Calendar
  • BISBEE: The "Queen of the Mining Towns"... Daily Tucson Shuttles available! (w/ advance RSVP's)

    Stroll Bisbee’s sidewalks and find delight at every turn: galleries, gourmet restaurants, coffee houses, book stores and specialty shops.
    more

  • 15% off a 3 Night weekend stay

    Stay Friday, Saturday and Sunday nights and get 15% off your entire stay.


    more

More Travel Deals
My Destinations Chat
 

 

Arizonas Travel Industry is a Stabilizing and Diversifying Force in the States Economy

July 12, 2007

This is the second consecutive year that AOT commissioned the Arizona Travel Impacts study, which provides a full-scale picture of the economic impact of travel in Arizona. By looking at a nine-year trend of direct spending, jobs and taxes generated by travel, AOT is able to have a complete understanding of the true and significant impact that this industry has on the State of Arizona. In addition, the Arizona Travel Impacts study includes county level information, giving further weight to the importance of travel in Arizonas rural counties.

In looking at an overall snapshot of the travel industry in Arizona, this study paints a robust picture of the industry and how it has changed over time. In 2006, travel was a $18.6 billion industry in Arizona, and this direct travel spending generated 173,000 direct jobs with earnings of $4.9 billion and $2.6 billion in state, local and federal tax revenue. These numbers have been on the rise since 2002, demonstrating a strong and resilient industry with tremendous growth potential.

One of the most effective ways to measure the impact of the travel industry is to stack it up against other industries that are considered vital to Arizonas economic success. The Gross Domestic Product (GDP) for the travel industry, which is the sum of earnings, indirect business taxes and other operating surplus, amounted to $6.9 billion in 2006, which is 3 percent of the total Arizona GDP. By way of comparison, the U.S. travel industry comprises about 2.5 percent of national GDP.

The travel industrys GDP in 2006 was $6.9 billion. In comparing the 2005 GDP of the travel industry with Arizonas four other major export industries (aerospace, microelectronics, agriculture and food production, and mining), the most recent year for which data is available for all five industries, travels $6.4 billion GDP comes out on top for 2005. Microelectronics is the next highest with a GDP of $5.2 billion, which is more than 25 percent lower than 2004. This points to the fact that the travel industry has a stabilizing and diversifying effect on Arizonas economy, posting consistent growth year after year. On the flip side, other export industries such as microelectronics are much more volatile and factors such as emerging technologies can have a significant impact on the GDP each year.

In contrast to other industries, the taxes generated by the travel industry are imposed on visitors rather than residents, as about 80 percent of visitor spending in Arizona is made by international travelers and residents of other states. In addition, the earnings generated by travel industry spending have also shown consistent growth over the last nine years, while the earnings in other export industries have fluctuated greatly. Earnings are one of the most important parts of the overall economic picture, as these are monies that stay in Arizonas economy and continue to affect the lives of all Arizonans.

Travel is a blue chip industry that consistently provides the stability and diversification necessary to keep Arizonas economy healthy, vibrant and competitive, said AOT Director Margie A. Emmermann. Arizonas economy relies on a mix of productive export industries, and tourism is the one industry that produces steady results year after year, while other areas often experience dramatic fluctuations in their ability to significantly contribute to the States economy.

One of the other key components of the Arizona Travel Impacts study is the analysis of travel impacts on a county level. Arizona is comprised of two populous, urban counties (Maricopa and Pima) and 13 counties with smaller, more rural populations. Although the urban areas often have a highly developed and sophisticated travel industry infrastructure, it often is the less urbanized areas of the state where the economic significance of travel and tourism is relatively more important. In fact, travel spending and earnings are up in every Arizona county over the last nine years, showing a trend of growth and vitality throughout the entire state.

More than three-fourths of all travel generated earnings occur within Maricopa and Pima counties, but as a group, the less urbanized counties in the state actually have a higher proportion of travel-generated earnings in relation to total earnings. About 3 percent of all earnings in Maricopa and Pima counties are travel-generated, while the proportion is more than 5 percent in all other Arizona counties. In addition, tax revenues generated by the travel industry are relatively more important for the non-urban areas of the state than for the more urbanized areas of greater Phoenix and Tucson. For example, travel-generated taxes represent almost 25 percent of the total tax base in Santa Cruz County and more than 25 percent in Coconino County, as compared to less than 10 percent in Maricopa County.

One of the new aspects of this years Arizona Travel Impacts study is an analysis of the economic impact of travel-related construction activity, which is a key indicator of the health of the industry. The 2006 travel-related share of the value of new construction of hotels and motels; amusement, social and recreational buildings; and stores and restaurants is more than three times as great as the new construction value of 2005. At an overall value of $960 million for the contract awards in place, new travel-related construction represents more than 16 percent of all non-residential construction in Arizona in 2006. This investment supported 13,400 additional construction jobs with additional earnings of $660 million.

The Arizona Travel Impacts study was conducted by Dean Runyan Associates using their proprietary Regional Travel Impact Model (RTIM). The RTIM was developed specifically for the constantly evolving travel industry and analyzes travel impacts on a state, regional and county level to provide a precise and in-depth analysis of the industrys role in an overall economic picture. A full copy of the Arizona Travel Impacts study and a link to an interactive tool that will allow users to generate graphs specific to their needs can be found in the Research & Statistics section of www.azot.gov.

Created as an executive agency in 1975, the Arizona Office of Tourism is charged with enhancing the state economy and the quality of life for all Arizonans by expanding travel activity and increasing related revenues through tourism promotion and development. AOT works to serve the Grand Canyon States travel industry and related businesses, the traveling public, and the taxpayers of Arizona.

Bookmark and Share
Superbowl_2015_partner_logo
Rocket Fuel