The U.S. economy is losing a whopping $3 billion per week in lost tourism dollars, with estimates of total losses for the 2020 year around $155 billion, according to a new report via the World Travel and Tourism Council (WTTC).
“The lack of international visitors to the U.S. due to the pandemic could wipe out more than $155 billion from the U.S. economy alone – a loss of $425 million a day – from which it may take years to recover. It could also threaten New York’s position as one of the world’s premier hubs for business and leisure travel,” warned Gloria Guevara, WTTC President & CEO.
This catastrophic loss to the American economy could eliminate upwards of 12 million jobs.
One of the first casualties of the virus-induced downturn crushing the U.S. hotel industry is Hilton Times Square, announcing Aug. 31, it will shutter operations on Oct. 1, laying off more than 200 workers.
WTTC’s Economic Impact Report said 16.8 million jobs in 2019 were supported by the travel and tourism industry, or about 10.7% of the entire US workforce.
Guevara said the downturn impacts millions of households as their livelihoods depend on tourism jobs, but with no “V-shaped” recovery for several years, this is an ominous sign that deep economic scarring and widespread permanent job loss is developing.
“The economic pain and suffering caused to millions of households across the U.S., who are dependent upon Travel & Tourism for their livelihoods, is evident from our latest shocking figures.”
“International coordination to re-establish transatlantic travel would provide a boost for the Travel & Tourism sector. It would benefit airlines and hotels, travel agents, and tour operators and revitalize the millions of jobs in the supply chain, which are dependent upon international travel across the Atlantic.”
“We urgently need to replace blanket quarantine measures with rapid, comprehensive and cost-effective test and trace programs at departure points across the country. This investment will be significantly less than the impact of blunt quarantines which have devastating and far-reaching socio-economic consequences.”
As a recovery in tourism could be years away, hedge funds are starting to build up wagers against CMBX 9, due to the tranche’s significant hotel exposure. The crash in tourism has triggered a hotel bust.