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Where to now? The worst is over for tourism but big issues remain, says new boss

The worst is over. After losses of about $50 billion and the existential threat from Covid-19, Queensland’s tourism sector is back, propped up by domestic travellers who could never let it die and government support of more than $1 billion.

Nov 10, 2022, updated Nov 11, 2022
Brett Fraser says the worst is over for tourism

Brett Fraser says the worst is over for tourism

Now it’s facing new problems; the workforce is still depleted by the loss of backpackers. Those remaining are fatigued, overworked and in need of their own holiday. The sector also needs massive investment and a complete overhaul of the approvals system and a swag of new attractions and products as we head towards the Olympics.

And even though it is back to where it was in 2019, before Covid-19, according to data from Tourism Events Queensland, that can’t be a place to rest. Covid may have wiped the slate but it didn’t remove structural problems the sector continues to face.

Back in the pre-Covid days, Queensland’s sector was suffering and had been overtaken by Victoria for the first time in the critical category of visitor expenditure.

Queensland had an overall occupancy rate of 69 per cent in 2019, one of the lower rates in Australia. Market share was falling and there was a heavy reliance on Chinese tourism that may or may not be there in the future.

Also, to achieve the 2032 goals adopted by the industry and the State Government in a report last week, an additional 3.1 million international airline seats over and above the 2019 supply by 2032 were needed.

The industry and the government have promised $200 million to get new airline capacity which is starting to show some results. United Airlines has just started a direct Brisbane to San Francisco flight, but there is a long way to go.

One stroke of good timing has been the injection of new talent at the industry group, QTIC and at Tourism and Events Queensland after the retirements of Daniel Gschwind after 20 years and Leanne Coddington and her 10 years.

Brett Fraser, a former head of the Brisbane City Council’s Economic Development Agency, took over as QIC chief in July. Patricia O’Callaghan will also soon take over the reins of the Government’s Tourism and Events Queensland.

“We are all watching very closely and very cautiously about what the next six months will bring, but I think the worst is over,’’ Fraser told In Queensland.

“I think we are through the worst of Covid and the sector has been on a fairly strong recovery certainly over the last 2 years. The data for the last 12 months is very strong and we are seeing overnight visitor expenditure exceeding pre-Covid levels.

“All of those are very positive. The question for a lot of us is whether outbound travel – Australians going overseas – will recover quicker than inbound.

“If outbound starts up a lot faster than inbound we could see a drop in the visitor numbers across Queensland and expenditure.

“We are definitely seeing outbound travel picking up. International flights are still at half of what they were in 2019 so the capacity is still only half of what it was but what we are seeing is the load factors on those flights extremely high.

“But we are seeing both inbound and outbound flights right now are all full.

“We are still looking at 2024 before international capacity gets back to where it was in 2019.’’

He said an issue now was how fatigued tourism operators were after an eight-month period this year when they were smashed by a revival in accommodation without staff to help deliver services.

“You have owners and managers who have been working in the frontline now for a substantial period.

“They are fatigued, they are exhausted. It’s a great problem to see the demand back. People have come again in spades, but operators are fatigued.’’

The industry was propped up by $1 billion in government spending during Covid and Fraser believes that without it a lot of businesses would have gone to the wall.

The release last week of a report from the State Government on what needs to be done in the run up to the 2032 Olympics was a stark reminder of the work that needs to be done.

It was based on the Queensland Tourism Industry Reference Panel recommendations.

The panel found that the Queensland tourism industry was struggling and needed a new direction. In effect, beach holidays alone were not enough. They needed to be layered with other experiences and tourists wanted life-changing holidays.

“Industry told us that visitors are increasingly seeking out experiences that create life‑long memories and help shape or reinforce their sense of identity – trends that have been accelerated by Covid‑19. We believe experience development will be the core platform for Queensland’s future growth,’’ the panel said.

Fraser said major reforms were needed in how new products were brought on as well as new experiences.

“How those are funded and approved and supported and delivered … there is a lot of work to do in that regard,’’ Fraser said.

“A lot of work is needed if we are to meet this $44 billion target.

“We need to make sure we are bringing forward new products and the delivery of new products is very complicated. We need to make sure there is collaboration between industry and multiple parts of government.

“We need to spend more on the demand side and new products and Government has a role to play there.’’

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