The Triple Threat Impacting the UK’s Travel & Tourism Industry

The world is currently in recovery mode post-pandemic and, with different levels of travel restrictions still active in many countries, there’s likely to be a staggered approach to recovery across countries and continents. 

The UK’s Travel & Tourism industry has a “triple threat” impacting international travel, from the ongoing issues of the global pandemic, the increasing cost to live and the current issue with passport / border control. Although some of these are global issues, they are stunting recovery growth in the UK:

The Covid-19 pandemic recovery

This is fast becoming the least important of these three vectors, albeit still of huge importance. Whilst the UK and devolved governments have scrapped the remaining coronavirus-related restrictions on international travel, there remains a reluctance to travel abroad this year.

Back in October 2021, an article in the Independent cited an American Express survey stating that around half of people were planning overseas holidays in 2022.

According to Evolution Money, the average cost of a UK family of four to take a two-week break is £4,792. On top of this, Britons tend to spend an extra £227 per person for each week they are away. Despite the high price of a family holiday, Britons seemed to be itching to get away after 2 years of lockdowns. But this was all before the true impact of the Cost of Living Crisis was felt.

Cost of Living crisis

In a recent piece of research we conducted the last week of March 2022, we identified that at least 71% of people will be cutting back on other expenses due to the rising energy prices (with a further 23% uncertain at that time). And whilst eating out was the biggest expense UK consumers will be cutting back on (at 68%), we found that almost half of respondents (49%) who will be cutting back on expenses stated that their holiday budgets and planning would be on the chopping block - an indicator that the forecasted recovery of Travel & Tourism in 2022 may yet have a sting in the tail.

“We are having to cut back on our food shopping treats, have to cut out having takeaways and we can’t afford to eat out, go out or have a holiday.”

Passport, Border and Immigration control issues at UK airports & ports

With the UK’s withdrawal from the European Union, subsequent removal of the ability to use the “EU Arrivals” lanes at airports and shortage of staff to accommodate at UK departure airports and ports, we have seen passengers facing huge delays when attempting to depart the UK. This is undoubtedly set to have a knock on effect on consumer confidence, particularly with the delays and cancellations experienced in April 2022.

These delays and cancellations are anticipated to last for months, with the head of Manchester Airport saying that passengers could face waits of up to 90 minutes to get through security “over the next few months” - slap bang in the middle of its busiest period.

“Despite our efforts since last autumn, the tight labor market around the airport has meant we have just not been able to hire people quickly enough to establish a full-strength team” — CHARLIE CORNISH, CHIEF EXECUTIVE OF MANCHESTER AIRPORTS GROUP (MAG)

Final Thoughts

With the Civil Aviation Authority saying that delays and cancellations at UK airports are “not just distressing for affected consumers but have the potential to impact confidence levels across the industry” it remains to be seen what level of disruption this will play on overall travel performance for 2022 - although it will almost certainly have an impact.

The UK is bracing for a perfect storm of issues relating to international travel & tourism over the next 6 months - and we will monitor how that progresses over that time. 

However, some relief can be found in domestic Travel & Tourism, which is recovering at a significantly faster rate, due in part to resumption of business travel and an increase in “staycation” holiday/short trip types in 2022. 

This will mean better UK trading for both travel and transport companies, as well as tourism related business, such as restaurants and hotels.

If you’re interested to know more about the work we do in the Travel & Tourism sector contact us at hello@rare.consulting.