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UK’s Inbound Tourism Industry Outlook for 2023

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The latest data from leading travel trade association UKinbound shows that confidence levels for the UK’s inbound tourism industry have returned to pre-Covid levels but high energy costs for attractions, supply side capacity issues for tour operators and difficulties with staffing across the industry are likely to be barriers to strong growth and recovery in 2023.

The association, which represents over 300 UK tourism businesses that service international tourists visiting the UK (inbound tourism), undertook its latest business barometer member survey in December 2022. 

Conducted by Qa Research, the survey shows that:

  • Expected or confirmed bookings for Q1 of 2023 are at the same level or higher than they were before the pandemic for over half of businesses
  • Nearly two thirds of businesses stated they expected revenue for Q1 of 2023 and booking levels for Q2 of 2023 to be the same or higher than before the pandemic
  • There is strong demand from US visitors to come to the UK with nearly half of businesses (44%) reporting they are seeing growth from this market

In contrast, businesses were asked what they expect to be their biggest barriers to growth over the next 12 months.  For 61% of tour operators, it is ongoing issues with supply chain capacity and for 76% of attractions, their biggest concerns are inflation and the cost of energy.   Ongoing recruitment and retention of staff remains a concern for nearly half of all respondents to the survey.

Joss Croft OBE, CEO of UKinbound commented “This data currently shows a mixed picture for the UK’s inbound tourism industry.

“It is great to see that many businesses are generally feeling optimistic about this year and confidence levels are returning to levels seen before the pandemic.  It is also very positive of course that the UK is experiencing high demand from the US market and the fact that the Chinese market is also now re-opening.  Unfortunately however, our members are still experiencing some fairly fundamental problems. 

“Unsurprisingly, inflation and energy costs remain a big concern – particularly for attractions especially with the scaling back of support with energy bills from April.  Our tour operator members are also telling us that they are experiencing issues with their supply chains such as not being able to secure enough quality accommodation for clients due to a reduction in bedstock because of Government contracts.  Furthermore, all parts of the industry are experiencing difficulties with accessing the skilled staff that they need.  

“We have some significant events taking place in 2023 in the UK – most notably His Majesty The King’s Coronation in May swiftly followed by the Eurovision Song Contest and whilst these events will generate a lot of positive attention for the UK, we cannot take this for granted. 

“International tourism is a competitive business, and if we are to fully realise the economic benefits from these events and help turbo charge the recovery of the UK’s inbound industry -  which is still suffering from ‘long covid’ due to being the first industry to be impacted by the pandemic and the last to recover – the Government needs to increase its efforts and spend to successfully market the UK to potential visitors around the world.”

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