Europeans are tired of staying at home. Due to the pandemic and inflationary episodes since 2021, EU consumers had to ‘buckle up’ to weather the bad economic times. According to the Consumer Expectations Survey (CES), in January 2024, almost 70% of respondents had reduced their consumption in the last 12 months, in addition to resorting to credit, using savings, working more . hours or request a salary increase to be able to maintain part of their standard of living.
In this context of adjustment, the variation in spending for most consumption items fell (food, transportation, housing or clothing and footwear). However, this cut was not reproduced for restaurant design, recreational activities, tourism and travel, which, far from decreasing, rose by around 1% and 5.5%, respectively, between 2021 and 2023. . .
These data reflect a change in mentality that has been maintaining the historically high records of the tourism industry. The European Central Bank (ECB) explains in How have households adjusted their spending and saving behavior to cope with high inflation? that the sustained expansion of services related to leisure and travel derives from “a change in preferences as a result of the lifting of restrictions after the pandemic.”
Thanks to this new dynamic, the weight of tourism has gained more weight. The ECB highlights that the resources allocated to these services have gone from 7.4% of total spending in 2021 to 12.9% in 2023.
The banking institution also highlights that the greatest downward adjustments have been shown in those categories that have increased their price the most. In this sense, food has suffered the largest increases and, in the case of transportation, the shortage of semiconductors that held back the availability of cars also influenced transportation spending to be reduced.
Savings drive travel
Confinement forced a large part of Europeans not to spend. The savings rate skyrocketed in most developed countries during the pandemic, which, according to analysts, was one of the main drivers of economic – and inflationary – growth in the following years. In Spain, the indicator has been reduced from around 25% that it reached in 2020 to 9.1%, according to the latest data for the third quarter of 2023 from the INE.
Although in the Spanish case the rate remains on average higher than the previous indicators since 2012, the ECB assures that at the European level reserves have been decreasing in the last two years.
Again, tourism is to blame. The institution directed by Christine Lagarde assures that this fall has been caused “mainly by greater spending on recreational activities, tourism and travel, rather than on essential goods and services”, something that has had a special impact on households with income . Mom’s tall ones.
An intangible that is noted in the income statement
The sector associates the desire to travel and the recovery of international connections after the pandemic with the fact that Spanish tourism has invoiced 186,000 million euros in 2023 and expects to increase its impact on the Spanish economy to 202,000 million euros this year, according to data advanced by the Alliance for Tourism Excellence -Exceltur- last January.
Expectations for this year continue to be promising. The Spanish Confederation of Travel Agencies (CEAV) announced that Laservas for these Easter holidays have grown by 10% compared to 2023 and, for the whole year, the sector ANTOR ANSTOR ANTOR TICIPATES that it will be able to improve the figures of travelers and disbursement of Tourists.
However, the fear that this situation is temporary has also caused Exceltur to advocate putting on the brakes, considering the levels of tourism growth since the pandemic “unsustainable.” The executive vice president of the Alliance, José Luis Zoreda, stated during the presentation of the employer’s annual results that “[el sector tiene] “We have to consider whether these rhythms and these intensities are viable, realistic, but above all if they are desirable.”
Zoreda assured that tourism companies had identified the unbridled desire to travel as one of the great incentives for growth in turnover. However, he stressed that they do not know how long it can last, so they seek to anticipate an explosion of the alleged bubble.
