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In-Depth Information
However, although local residents are able to overcome the problem of
higher prices for some products, this is not the case with real estate. If land
prices rise, locals also have to pay more. In some destinations, young families
might be unable to buy a future home and will therefore have to find a property
somewhere else. In addition, local business people might not continue their
traditional businesses when the real estate costs of their businesses become too
high. Consequently, more and more real estate will be used for tourism pur-
poses, which relates to interdependency theory. This leads to the local economy
becoming dependent on tourism for its survival. Vanhove (2005) argues that
this effect is also quite local and does not substantially contribute to general
price increases in the real estate market at the national level. In addition, he
argues that, from a macroeconomic point of view, higher real estate prices rep-
resent a benefit and all owners profit from the additional value that accrues.
Overall, then, the inflationary/deflationary effects of tourism demand are
complex and often temporal and local, yet there is sufficient evidence in the
tourism literature that prices and exchange rates do influence real tourism
demand and, thus, the economic effects of tourism in any given country.
The impact of tourism on employment
Tourism creates valuable employment opportunities. Indeed, commonly
regarded as a human-resource intensive activity, tourism represents what may
arguably be described as the world's single largest source of employment. As
statistics on tourism development are still underdeveloped, different estimates
are based on different methodologies and, thus, vary. However, as pointed out
in the introduction, the tourism economy - that is, both the direct and indi-
rect tourism sectors - provide between 6% and 9% of global employment
(UNW TO, 2011a; W TTC, 2011). By 2012, 1 in 11 jobs were linked to tourism
(UNWTO, 2013b). Tourism's role and contribution to employment and,
hence, development varies considerably according to the scale, character, stage
of development and relative importance of the tourism industry in a country
or destination. Table 3.3 indicates tourism's contribution to overall employ-
ment in top tourism and some other smaller countries.
In some developing countries that base their economies strongly on tour-
ism, the tourism sector might employ more than half the total labour force.
For example, according to WTTC data, the tourism sector in Aruba accounts
for 74.7% of total employment, in Macau 87.0% and in the Seychelles 55.1%
of the total employment (WTTC, 2011). While these data might be method-
ologically overestimated, it is evident that tourism-related jobs represent an
important or main source of employment for some countries. At the same
time, tourism may be an important generator of jobs in some developed
countries: it generates more than one-tenth of total employment in Austria,
France and Spain (Table 3.3). In some tourism regions in developed countries
it may even be the main generator of employment.
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