Will the “Trump Slump” affect Juneau’s travel industry?

Image courtesy FreeImages.com/peter bierman

It seems that Pres. Trump is running the country like a business. Unfortunately for us, he’s running it like one of his businesses.

A snarky article in Salon left me wondering about a serious issue for tourism. I checked around, and it seems that numerous publications – including Travel Weekly and Frommer’s – have brought attention to a decline in bookings that they are calling the “Trump slump.”

I’m not an expert in the tourism industry, but I decided to go and see what I could find out about this phenomenon and whether it might affect Juneau. Here’s what I turned up.

Who says there’s a ‘Trump slump’ in tourism?
I originally saw a reference to it in Salon under the title, Comin’ to America no more: the “Trump Slump” in travel is costing the U.S. billions:

People around the world have taken a look at Donald Trump and decided his America is not a place they want to visit. The result has been labeled the “Trump Slump,” a drop in international tourism that’s predicted to cost the United States more than $7 billion.

In an attempt to see whether Salon was exaggerating, I made my way to Frommer’s, which had this to say in “The Travel Press is Reporting the ‘Trump Slump,’ a Devastating Drop in Tourism to the United States”:

Though they may differ as to the wisdom of the move, the travel press and most travel experts are of one mind: They are currently drawing attention to an unintended consequence of the Trump-led efforts to stop many Muslims from coming to the U.S., pointing to a sharp drop in foreign tourism to our nation that imperils jobs and touristic income.

It’s known as the “Trump Slump.” And I know of no reputable travel publication to deny it.

On March 6, Travel Weekly went to press with Data shows ‘Trump slump’ continues:

Daily net bookings to the U.S. dropped 4% during the nine days after the Feb. 17 news that a new travel ban was in the works, reported travel data company ForwardKeys on Monday.

And on April 5, British site The Independent published Trump slump: Drop in American tourism is costing US billions:

The drop-off in tourism is predicted to result in 4.3 million fewer visitors this year, which adds up to a staggering loss of $7.4 billion in revenue for the US.

Verdict: It does appear that the “Trump slump” is a genuine industry concern.

Image courtesy FreeImages.com/Robert Linder

Could this have an impact on Juneau?
I was unable to locate recent statistics about visitors to Juneau who are from other countries. However, I did find a 2012 report about summer tourism between May and September 2011: the Alaska Visitor Statistics Program VI (AVSP) by the McDowell Group.

AVSP gave a total of 1,556,800 visitors. With respect to international tourists, it stated the following:

In terms of specific communities, the international market was most likely to visit Juneau (73 percent), followed by Ketchikan (70 percent) and Skagway (61 percent). Compared to the overall market, international visitors showed higher visitation rates for cruise ports, and lower visitation rates for most Southcentral communities.

It also stated that about 17% of visitors to Alaska during the study period were from outside the U.S. (about 264,500), and the share of non-U.S. visitors had increased slightly between 2006 and 2011. Per person spending averaged $941, but I didn’t see spending broken down by traveler origin.

What could this mean to Juneau?
An article in CNN notes that one study anticipates a 7% decline in international visitors, but the source above said it had seen an actual 4% drop in bookings, so let’s quantify the “Trump slump” at 4%.

Since we don’t have newer numbers, let’s just use the old numbers and see what would have happened in 2011 if 4% of those international tourists had decided to skip America because it was too dangerous.

So, there were about 265,000 international tourists, and 73% of them visited Juneau. That’s our baseline of international visitors to Juneau:

264,500 x 73% = 193,085

A 4% decline would be:

193,085 x 4% = 7,723

And let’s say that the average spending per traveler would have been $941, with 25% of that spending in Juneau*. What would the lost revenue be?

Total lost sales: 7,723 x $941 = $7,267,343

Lost Juneau sales: $7,267,343 / 4 = $1,816,836

Assuming those Juneau sales were taxable at 5%, what would the City have collected?

Lost Juneau tax revenue: $1,816,836 x 5% = $90,841

Wrapping up
I’ll be the first to say that there are some big assumptions wrapped up in this little analysis; for example, I assumed that domestic travelers don’t increase (maybe they want to avoid U.S. Customs too!). Overall, though, this seems like a reasonable take on the information available.

Hopefully our State and CBJ leaders are looking at this issue, because they have access to the expertise – and data! – to be able to spot whether this is shaping up to be a potential problem. If we are lucky, they also have ideas and resources to ameliorate Trump’s apparent toxicity as well.

– Mary

* 25% assumed to be in Juneau because I figure we are one of the 4 major tourist hotspots in Southeast: Skagway, Juneau, Sitka, and Ketchikan.

Opinions in this article are those of the author and do not represent official positions of TongassDemocrats.com, the Tongass Democrats, or anyone other than the author. 

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