Tourism

Posted June 13, 2014

The tourism industry in Nova Scotia tells us that it is a $2 billion source of expenditures in the province. Readers may be surprised by what spending is included in those numbers, and how they are calculated.

Tourism’s economic impact is notoriously difficult to measure. Restaurants and shops do not record whether a patron is from around the corner or around the world. Tourists are often from other parts of the province. Someone from Halifax visiting Yarmouth or Louisburg is just as much a tourist as someone from Boston.

To get a number requires two sets of data. First the number of people entering the province is counted at airports, ferry landings, and border crossings. Secondly an estimate of average expenditures per person is developed by surveying visitors. Multiplying the two gives an estimate of $1.18 billion for out-of-province visitors.

The process is repeated for Nova Scotians, with the estimated number of trips and average expenditures developed by another set of surveys. This adds $.84 billion.

The practice in Nova Scotia is consistent with national and international standards, but that does not make it any more precise. The numbers give an indication of trends but should be viewed as very approximate.

Most pictures we see from tourism advocates show leisure travelers enjoying outdoor experiences away from Halifax. Those visitors to rural Nova Scotia represent much less than half of what is counted in tourism. Consider:

  1. Most (54%) of the spending is in Halifax.
  2. “Tourism” includes people travelling for business or leisure. In Halifax, one experienced operator estimates that 70% of room nights are for business travel. These are of course no less valuable to the economy, but are not what most people think of when they are talking about tourism.
  3. Of the $2 billion spent, about $.8 billion is for accommodation, food, and recreation. These all represent high value consumption of local products and services. The rest is made up of groceries, other shopping and transportation, including flights.
  4. Any non-routine trip by a Nova Scotian of more than 40 km counts as tourism.

Thus your gas money counts if you travel from Halifax to Middleton to visit Aunt Thelma. So will your car repair if you have a problem en route. If you drive in from Truro for a day’s shopping at Dartmouth Crossing you will also count what you spent at Best Buy or the Mattress Gallery.

If you own a plumbing business in Halifax and make a trip to Bridgewater to look at an operation you might buy it will count. So will the trips to Halifax by your New Glasgow employees attending the national plumbers’ convention. So will the flights to Halifax by out-of province plumbers.

The rural tourism business is highly seasonal. The occupancy rate of accommodations outside of Halifax is three times as high in May till October as it is in the other half of the year.

The resulting jobs are mostly seasonal and many of them are low wage. They are good for students and as second incomes in a household, but do not form a hub around which an economy can be built.

The Ivany report proposes 19 ambitious goals for the next ten years. One of them is to double our revenue from tourism.  It would be great if we can have twice as many people coming to Nova Scotia to play golf or to attend plumbers’ conventions. But it does not much help our economy if we buy more TV’s and mattresses, and Aunt Thelma may not want to see us twice as much.

The report recognizes that the goals need work:

“To set the process in motion the Commission is proposing the following goals to guide the development of a ten-year action plan for economic transformation and renewal in Nova Scotia. It is assumed that more in-depth analysis, consultation and refinement will be required before they are formally adopted. The core assertion here is that goals of this challenging nature are needed to orient and motivate leaders…”

It would be a disservice to the report to adopt the goals without debate. Rather they should be studied and debated by a broad range of players, and amended where necessary, so that the final version is well considered and well understood.

In the process we should not lose two essential characteristics of the proposed goals. First, they are highly aspirational and transformative. Secondly, they are concrete and measurable so that all Nova Scotians can know how we are progressing toward them.

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Most Recent Comments

  • There is a market for the Yarmouth ferry but it is not Nova Scotians..Historically Canadians (including Nova Scotians have accounted for less than10% of tourism traffic on Portland to Yarmouth ferries. The market is among the 100 million or so people living on the eastern seaboard of the United States who have the time and the money to take the new ferry (perhaps retired baby boomers ) and want to travel by car or by motorcycle or by coach or by motorhome and so have no interest in flying.They want to travel to a foreign country where English is spoken and to a place that is beautiful, safe,uncrowded and not too hot in the summertime unlike where they live. Nova Scotia and that ferry are ideally suited to that market and it is certainly large enough to fill that boat many times over.Whether or not there is the marketing savvy to capture it remains to be seen.

    Allan Rodger | June 16, 2014

  • Some things to consider…Every fifteen years or so the govt through an independent commission or whatever states that they would like to double tourism….the last time was in 2004 for tourism to double by 2010..these stated objectives mean nothing..also tourism spending can increase simply by have visitors who stay longer or spend more rather than by increasing the numbers of visitors. ..Obviously “extra muros” tourism spending is like an export and is very valuable..particularly when we note that the number of Americans visiting Nova Scotia overland is less now than 60 yrs ago…and there continues to be a long term decline of visitation to NS from markets outside outside the Maritimes.There remains a constant long term decline despite high recommendations by The Lonely Planet,Fodor’s etc..The cruise ship business is growing but as a percentage of overall tourism spending it is negligible ..I believe about 3 % and spending is primarily in urban areas rather than rural areas where tourism spending could be valuable as a rural development tool.. And with respect to Nova Scotians staying and travelling in their own Province it is better than nothing. And the NS Minister of Tourism stating several weeks ago admonishing Nova Scotians to “use it or lose it ” regarding the new Yarmouth ferry (thereby encouraging us to vacation outside of Nova Scotia) is not helpful

    Allan Rodger | June 15, 2014

  • Tourism in NS is a real cash grab for government . They collect commercial taxes on hundred of properties ;they collect sales taxes on accomodations and dining and gas etc . Now they want to add a room tax under the guise it will generate millions for marketing . Trouble is it is the accommodations owners who increase their price to collect the tax but then ,based on the current processes , these same owners are excluded when it comes to being able to access that marketing money or even have a vote on how it was spent. In many cases the room tax money goes to groups that may call themselves an association , but through a loophole in NS law , you can be an association but not have any voting members or any elections . This then by default means all these millions in room tax by pas any public procurement process and oversight . Less than 50% of rooms sold in any year are now sold from our rural and coastal locations . The numbers of Ma and Pa small businesses keeps declining and hardly any municipality is paying attention let alone the province . Add to that the increasing numbers of unlicensed and underground rentals and you have perfect storm, a terrible investment climate, and no incentives to improve let alone add product . We are a province where you have to drive every where now . You can’t get a bus or trail at the airport to go anywhere .
    There hasn’t been a real good survey of business owners in the last 15 years . Government changes policies and the financial models over and over without talking to the business owners.
    They held meetings a few years ago to come up with a strategy but never even told the owner what was the inout of all their meetings yet they went and created a whole new crown corporation to carry out the new strategy. Numbers wise , if you look back to 2000, you’ll see a lot of declines more than inclines in numbers. Now compare us to Newfoundland and Ireland. SO , this shows us it is not the cost to get here that is the problem if Newfoundland and Ireland are doing much better than us .

    ps | June 14, 2014

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