According to a recent report, 90 percent increase in annual tourists to New York City over the past two decades has spurred hundreds of thousands of jobs and elevated tourism into one of the four key drivers of New York City’s economy.
The study reveals that there are now more direct jobs in tourism (291,084) than in finance (268,200) and nearly twice as many jobs as in the city’s tech sector (128,600).
The report, which was funded by the Association for a Better New York (ABNY) and Times Square Alliance, also shows that tourism has become an increasingly vital source of middle-income jobs in New York. And it finds that no other sector offers as many accessible jobs—with 91 percent of the jobs in industries fueled by tourism open to workers with less than a bachelor’s degree.
However, the study also concludes that New York’s tourism sector faces several new and evolving challenges that could cause tourism to slip and jobs to decline—from the strengthening dollar and growing negative perceptions of the U.S. to capacity problems at the city’s airports. And it finds that New York has never adequately planned for a city with 60 million tourists a year, or made sufficient investments in its tourism infrastructure to sustain this many annual visitors.
Among other key findings of the report:
- Tourists are responsible for 24 percent of all sales at New York City restaurants and drinking places, according to our analysis of Visa credit card transactions.
- This suggests that tourists have spurred much of the job growth at restaurants over the past two decades. The city has added 142,000 jobs at “restaurants and drinking places” since 2000.
- Tourists account for 18 percent of all Visa transactions at retail stores in the city. They account for an even higher share of sales at the department stores (48 percent), electronic stores (35 percent), and sporting goods stores (23 percent). International tourists alone account for 29 percent of all Visa transactions at the city’s jewelry stores.
- The retail sector has experienced a net gain of 71,000 jobs since 2000, and much of this is due to tourists.
- In recent years, tourists have given local retailers a key source of revenue at a time when many brick-and-mortar storefronts are losing business to online purchases.
- Tourists are also fueling the growth in attendance at cultural institutions—and the job gains that have come with it. Tourists now comprise 73 percent of visitors to the Museum of Modern Art, 70 percent of visitors to the Whitney Museum of American Art, and 60 percent of the Metropolitan Museum of Art’s visitors. The city’s museums and historical sites have added 4,500 jobs in the past 15 years—an 86 percent increase.
- The number of workers in the city employed by tour vans, double-decker buses, tourist boats, and other forms of sightseeing transport nearly doubled over the past 15 years. Incredibly, New York City accounted for 47 percent of the nation’s net job gains in this sector.
- The enormous increase in tourists over the past couple of decades has even begun to spur growth in the city’s tech sector. The study identifies more than two dozen venture-backed travel-tech start-ups based in the city, 16 of which had been founded just in the last five years.
Tourism is a key source of middle class jobs that are accessible to a diverse mix of New Yorkers
- The average hotel job in New York City pays $61,756, even more than a position in manufacturing ($57,807)—and the city has added more than 12,000 hotel jobs since 2000. There are now 51,000 hotel jobs citywide, making it one of the biggest sources of new middle class jobs.
- More than 65 percent of New York City residents who work in tourism-related industries are people of color and 54 percent are immigrants, compared to 59 percent and 44 percent, respectively, of workers in other sectors.
Tourism is boosting the economy of all five boroughs
- Tourists comprise a significant and growing share of food and retail sales in the boroughs outside Manhattan. Tourists now account for 14 percent of Visa purchases at restaurants in Prospect Heights and Cobble Hill. In Jackson Heights and Elmhurst, tourists are responsible for 12 percent of all spending in electronics stores and 10 percent of spending in discount stores. Tourists are responsible for 6 percent of all retail spending in those neighborhoods, totaling more than $23 million annually.
- Since 2000, Brooklyn added 1,294 accommodations jobs (a 198 percent increase) while Queens added 876 (37 percent). Staten Island added 279 jobs (317 percent), and the Bronx added 161 jobs (52 percent). Manhattan, meanwhile, added 9,515 accommodations jobs, a 27 percent gain.
- 81 percent of the New Yorkers employed at hotels throughout the city—including in Manhattan—live in the four boroughs outside Manhattan. Queens is home to 14,750 hotel workers, followed by Brooklyn (10,986), Manhattan (8,324), the Bronx (6,881), and Staten Island (1,819).
The report includes several recommendations to strengthen the city’s tourism sector amidst a growing number of threats and challenges. These include:
- Upgrade the city’s tourism infrastructure. New York has never adequately planned for a city with 60-plus million tourists a year, and it has not made enough of the infrastructure investments necessary to sustain this many annual visitors. This means everything from creating new solutions for tour bus parking to modernizing the air traffic control system.
- Increase the city’s tourism promotion budget. New York boasts one of the best tourism promotion agencies in the world, NYC & Company. But while Mayor de Blasio has increased NYC & Company’s public funding, its overall budget has not stayed competitive with that of tourism promotion agencies in other global destinations.
- Create the city’s first long-term tourism plan, with involvement from economic development, planning, and transportation agencies. With tourists accounting for roughly 70 percent of passengers at JFK Airport and 50 percent at LaGuardia, the Port Authority should work to improve the airport experience for tourists. The agency has made important investments in recent years, yet more could be done. For instance, most passengers at the city’s three airports can’t get free WiFi in their terminals. Meanwhile, more public signage and displays should be made available in multiple languages.
The full report, titled Destination New York, can be read here: nycfuture.org/research/destination-new-york.