SARS Concerns Leading to More Lost Tourism Jobs, U.N. Says
(Labor agency also cites security concerns, economic slump)
15 May 2003

Concerns about severe acute respiratory syndrome (SARS), security and the ongoing global economic slump may cut another 5 million jobs in 2003 from the world tourism industry, according to a United Nations agency.

The estimate dampens the optimism of early 2003 that the worst of the aftermath of the September 11 terrorist attacks might be over, said the U.N. International Labor Organization (ILO) in a May 14 press release announcing a new report on tourism employment.

Asia is the worst hit region, facing up to a 30 percent loss in 2003 tourism employment, the release said.

The release said the longer the decline in tourism lasts, the more likely the jobs loses will be permanent.

It said companies could help save jobs by adopting more flexible work methods and re-training existing employees.

The ILO is urging governments to support travel companies' implementation of temporary cost-saving measures in order to save as many jobs as possible, according to the release.

Travel and tourism represent more than three percent of international employment, the release said.

Following is the text of the ILO press release:

ILO sees further tourism job losses due to travel woes
SARS, economic doldrums cited as causes

Wednesday 14 May 2003

GENEVA (ILO News) - Reduced travel due to new concerns over the disease SARS, combined with the ongoing economic downturn, may cut another 5 million jobs in the battered world tourism sector this year, bringing to 11.5 million the total number of jobs lost in the sector since late 2001, according to a new analysis by the International Labour Office (ILO).

The ILO said the estimated 5 million additional job losses since the start of the year come on top of some 6.5 million jobs lost during the crisis in the travel and tourism in 2001-2002. That means a loss of one of every seven jobs in travel and tourism since 2001, with no end in sight, the ILO said.

The ILO said much of the recent pressure on jobs in travel and tourism can be attributed to the outbreak of Severe Acute Respiratory Syndrome (SARS), especially in Asia and other regions. This comes on top the global economic doldrums and other factors such as security concerns which had driven down the number of jobs last year.

The travel and tourism industry represents over 4 per cent of global GDP and over 3 per cent of employment worldwide. Counting suppliers and other economic activities related to travel and tourism, the value of the sector can reach as high as 11 of global GDP and 8 per cent of world employment.

Prior to the slump, direct employment in the industry's own enterprises amounted to close to 80 million, while including suppliers and other related employment brought the total nearly 200 million jobs worldwide.

The slump in the industry comes after a strong economy had fueled a global tourism boom in the late 1990's. In the peak year 2000, the number of international trips rose by a record 4.5 per cent from the year before. In the year 2001 the industry suffered disastrous effects from the events of September 11 and shrunk by more than 1 per cent on an annual basis, braking the growth dynamics which are needed to keep employment at its normal level.

The report added that prospects for a recovery are grim, saying "the capacity of the travel and tourism industry to create employment seems to be severely damaged by the recent events."

The new estimate of further job losses continues to dampen optimism that began to emerge early in 2003 in the tourism sector, that the worst of the aftermath of September 11 might be over. The sector had just weathered a year of virtually flat growth in 2002, exacerbated by attacks on tourists in 2002.

The crisis moves to South East Asia and the Pacific

The impact on the worldwide travel and tourism industry can be assessed by dividing the world into three geographical zones according to their exposure to the crisis. The countries or areas directly affected by SARS (China, Hong Kong, Singapore, Taiwan, and Vietnam) may lose more than 30 per cent of their travel and tourism employment, whereas their neighbours (Australia, Fiji, Indonesia, Kiribati, Malaysia, New Zealand, Philippines, Thailand and others) in South East Asia and Oceania will lose an estimated 15 per cent. The rest of the world faces an average 5 per cent loss in tourism employment, the ILO said.

In Thailand, one in nine jobs is in danger when travel and tourism slumps. Thai Hotels are experiencing cancellation rates of 5 to 10 per cent and officials in Bangkok reported that up to 50 per cent of foreign bookings had been cancelled. The Philippines remained moderately affected so far, with foreign arrivals dropping by 4 per cent in the first quarter as compared to the first quarter 2002, in spite of a 13 per cent growth in January over last December. Malaysia, on the other hand, is affected heavily, with airline bookings down by 40 per cent and hotel occupancy rates by as much as 30 per cent.

The report warns of long term damage to employment in the sector, noting that "additional factors need to be considered if the slump continues," and adding that the longer the decline in travel and tourism activities lasts, the greater the possibility that jobs will be eliminated entirely.

New ways of getting the work done may help the sector make ends meet in the face of declining revenues. These include more versatile working methods, re-skilling or expanding the skills of existing employees, more flexible working hours and so-called "multi-skilling", where, for example, front-desk personnel will help with check-ins.

However, the report also warns that the loss of employment in tourism and travel often hits lesser-skilled or "socially weaker" staff the hardest, as employers tend to keep their skilled core staff through the crisis. Part-time workers, women, migrants and younger workers face the highest risk of losing their source of income as long as substantial growth isn't restored, and have more difficulty finding alternative work.

The ILO report calls on governments, employers and trade unions in some countries to embrace or expand tripartite solutions under recommendations made at an Informal Meeting on the Hotel and Tourism Sector: Social Impact of Events Subsequent to 11 September 2001. The ILO said such tripartite social dialogue is essential to supporting affected companies and their efforts to implement temporary cost-cutting measures that will help them stay viable and preserve as many jobs as possible.

(Distributed by the Bureau of International Information Programs, U.S. Department of State. Web site: http://usinfo.state.gov)