ANALYSIS OF RESULTS


KEY RESULTS

Tourism consumption is the total value of goods and services consumed by visitors. It is measured in purchaser's prices (the price paid by the tourism consumer). In 2007-08 tourism consumption increased by 4.5% to $88,723m. The receipts of Australian producers of tourism goods and services exclude product taxes like the GST and include subsidies (collectively known as net taxes). In 2007-08 tourism net taxes on products increased by 4.2% to $6,907m. Tourism supply at basic prices (consumption less net taxes) increased by 4.6% to $81,816m.

Imported goods and services consumed by visitors are not part of domestic production by Australian industries. Tourism imports consumed in Australia increased by 14.7% to $7,585m in 2007-08. Domestic tourism output (supply at basic prices less imports) increased by 3.6% to $74,232m over the same period.

When producing tourism goods and services Australian businesses use goods and services produced and supplied by other businesses. These are known as intermediate inputs. Tourism intermediate inputs increased by 2.9% to $40,499m.


TOURISM GROSS VALUE ADDED

Industry gross value added measures the value of production exclusive of product taxes such as the GST. It is the preferred national accounts measure of the production of industries because it is free from distortions in prices caused by changes in tax rates or the introduction of new taxes.

Tourism gross value added is calculated by subtracting tourism intermediate inputs from tourism output at basic prices. In 2007-08 tourism gross value added increased by 4.4% to $33,733m. Total industry gross value added increased by 8.0% to $1,039,829m, representing a decrease in tourism share of value added from 3.4% to 3.2%. When comparing tourism to other industries and the total economy it must be understood that tourism is not a distinct industry, rather it comprises a portion of the economic activity classified to ANZSIC industries in the core national accounts.

TOURISM GROSS DOMESTIC PRODUCT (TOURISM GDP)

Tourism GDP is calculated by adding tourism net taxes on products to tourism gross value added. In 2007-08 Tourism GDP increased by 4.4% to $40,639m. With GDP for the Australian economy having increased by 8.3%, the tourism industry has grown at slightly more than half the rate of the total economy.

All the aggregates above are presented in current price terms, and so include the effects of price change as well as the volume of tourism activity. Volume estimates of tourism have not been compiled because of conceptual issues involved in deflating the supply side estimates. In the absence of volume estimates, the tourism share of industry GDP is presented. In 2007-08 the tourism share of GDP was 3.6%, a decrease of 0.1% on 2006-07. This is the sixth annual decrease in tourism share of GDP over the past seven years since a peak of 4.7% in 2000-01. While the peak of 4.7% in 2000-01 was heavily impacted by price increases in tourism services resulting from the introduction of the GST and the volume impact of the Olympic Games, the overall pattern of declining share has continued over a long period.

The key factors behind the fall in the tourism share of GDP in 2007-08 were that Australians travelled less in Australia and more overseas, and that non-tourism related industries grew faster than tourism related industries. Reflecting this is the moderate growth in domestic tourism consumption (4.0%), compared to total outbound expenditure by Australians travelling overseas which rose 11.9% in 2007-08.


COMPONENTS OF TOURISM INDUSTRY GROSS VALUE ADDED

Tourism gross value added increased by $1,437m (4.4%) in 2007-08 to $33,733m. The largest contributors to the growth in tourism gross value added were Accommodation (up $438m, 9.6%), Education (up $368m, 18.0%), Ownership of dwellings (up $234m, 10.7%), Cafes, restaurants and takeaway food outlets (up $230m, 7.3%), and Other retail trade (up $153m, 4.0%). The largest negative contributors were Other manufacturing (down $130m, 12.8%), due to an increase in consumption of imported goods by visitors, and Motor vehicle hiring (down $97m, 11.7%).

COMPONENTS OF TOURISM CONSUMPTION

Tourism consumption increased by 4.5% to $88,723m following strong growth of 7.4% in 2006-07. Domestic tourism consumption increased by 4% to $65,130m and international tourist consumption increased by 6.1% to $23,593m.

Domestic tourism consumption represents 73.4% of total tourism consumption, whereas international consumption represents 26.6%. The international component of total tourism consumption has increased in share for the second successive year, increasing from 26.2% in 2006-07 and 25.7% in 2005-06.

Of the 4.0% increase in domestic tourism consumption, consumption by households increased by $2,017m (3.9%) and consumption by business and government increased by $477m (4.4%).

The major contributors to the increase in domestic tourism consumption were Accommodation services, Takeaway and restaurant meals, and Shopping (including gifts and souvenirs). The major contributors to the increase in international tourism consumption were Education and Accommodation services.

SHARE OF TOURISM CONSUMPTION, Selected tourism products - By type of visitor - 2007-08
	Households	Business/government	International	All visitors
	%	%	%	%
Long distance passenger transportation	8.4	32.8	23.1	15.4
Shopping (including gifts & souvenirs)	18.5	0.1	10.9	14.1
Takeaway & restaurant meals	17.7	15.2	8.7	15.0
Accommodation services	8.7	17.8	14.5	11.4
Food products	9.9	2.5	7.4	8.3
Fuel (petrol, diesel)	8.3	14.5	1.6	7.3
Taxi fares	0.4	3.3	1.1	1.0
All other tourism products	28.1	13.8	32.7	27.5
Total	100.0	100.0	100.0	100.0

The major contributors to total tourism consumption continue to be Long distance passenger transportation, Takeaway and restaurant meals, Shopping (including gifts and souvenirs) and Accommodation services. Combined, these products contribute 55.9% of total tourism consumption in 2007-08.


INTERNATIONAL TRADE IN TOURISM

Tourism exports are domestically produced goods and services consumed by international visitors to Australia. Tourism imports are consumption of overseas produced goods and services by Australians on overseas trips. In 2007-08 tourism imports grew faster than tourism exports, generating a deficit in the tourism balance of trade (tourism exports less tourism imports).

TOURISM EMPLOYED PERSONS

The tourism industry employed 497,800 persons in 2007-08, an increase of 15,000 (3.1%) on 2006-07. This compares with an increase of 2.7% in total employed persons in the Australian economy. The tourism share of total employment remained steady at 4.7% when compared to 2006-07, however, over the past decade the tourism share of total employment has decreased by 0.3 percentage points.


VISITOR NUMBERS

The slower annual growth in tourism consumption in 2007-08 (up 4.5%) compared with the annual growth in 2006-07 (up 7.4%) was driven mainly by a decrease in the number of visitors in 2007-08 compared with 2006-07. Between 2006-07 and 2007-08 domestic trips decreased by 1.1%, driven by decreases in the number of overnight trips (down 1.8%) and day trips (down 0.7%). International trips showed a slight decrease (down 0.2%). The overall decrease in the number of international visitors to Australia was driven mainly by falls in the number of visitors from Japan, United Kingdom and Korea.

In contrast, the number of Australians travelling overseas grew strongly by 11.2% in 2007-08, with the strong growth driven by the increased number of Australians visiting Indonesia, Thailand and United States of America.