The UK Tourism Satellite Account (UK-TSA): 2012

The annual contribution of tourism to the UK economy from demand for goods and services caused by tourism activity and supply of these goods and services.

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Cyswllt:
Email Chris S Payne

Dyddiad y datganiad:
26 June 2015

Cyhoeddiad nesaf:
To be announced

1. Main figures

  • Tourism Direct Gross Value Added (GVA) was £57.3 billion in 2012

  • Tourism Direct Employment rose from 1.46 million in 2011 to 1.53 million in 2012

  • The number of Tourism Direct Full-time Equivalents rose from 1.15 million in 2011 to 1.22 million in 2012

  • Domestic tourism expenditure rose from £99.8 billion in 2011 to £106.6 billion in 2012

  • Inbound tourism expenditure rose from £21.0 billion in 2011 to £21.8 billion in 2012

  • Tourism Direct GVA was estimated to be £58.7 billion in 2013 and £59.6 billion in 2014

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2. Introduction

The UK Tourism Satellite Account (UK-TSA) provides information about the demand for goods and services associated with the activity of tourists and the relationship of this demand to the supply of such goods and services within the UK economy.

The TSA methodology is necessary because tourism is defined by the characteristics of the consumer in terms of whether they are a tourist or resident and this, therefore, differs from “traditional” industries such as manufacturing and agriculture which are defined by the goods and services produced themselves.

The UK-TSA sets out the contributions that tourism makes to the economy of the UK as a whole and to individual “tourism industries” in particular. Such industries invariably serve tourists and non-tourists alike and the UK-TSA includes a series of “Tourism Ratios” which estimate the proportions of products supplied in the UK that are consumed by tourists (in Table 6 of the UK-TSA).

The Tourism Intelligence Unit (TIU) in the Office for National Statistics (ONS) has produced the 2012 UK-TSA in this release and was also responsible for previous UK-TSAs covering the individual years from 2008-2011. The underlying concepts and methodology for the new release only differ slightly from those of earlier releases but revisions to the data sources which are used to construct the TSA, in particular the national accounts estimates of the output of industries mean that updated UK-TSA estimates are included here for 2008-2011 to provide consistent estimates for the UK-TSA series.

In this report we present the findings for the 2012 UK-TSA. The data for this is included in sets of TSA tables available as separate downloads, alongside revised data for the 2008-2011 UK-TSAs. Furthermore, a ‘nowcasting’ technique has been applied to the 2012 TSA to provide estimates of the key TSA aggregates for 2013 and 2014. A description of this methodology is available on our website.

As well as providing an indication of the economic importance of tourism in the UK, the report includes information about tourism demand and supply and explanations of the internationally agreed concepts and definitions that are part of the TSA process.

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3. Tourism Direct Gross Value Added (TDGVA)

Tourism Direct Gross Value Added was worth £57.3 billion in 2012 and was a 6.3% increase when compared to 2011 where TDGVA stood at £53.9 billion (See table 1). This is a key aggregate of the UK-TSA as it indicates the output of the set of UK tourism industries that is driven by tourism spend directly.

Figure 1 shows the value of each of the individual tourism industries in 2012 and here the main contributor to TDGVA was ‘other consumption products’ which refers to the proportion of output from non-tourism industries that is accounted for by tourism spend. This includes activities such as ‘special shopping’ or ‘personal transport’ and other activities not included within the tourism industries.

The highest contributors to TDGVA other than other consumption products included food and beverage serving services, travel agencies and other reservation services, and accommodation services for visitors, each contributing over £8 billion to TDGVA.

Sport and recreation activities also contribute a high proportion of the total TDGVA estimate in 2012 with that industry worth £2.7 billion with only the afore-mentioned sub-industries and air passenger transport contributing more to TDGVA (Air passenger transport was worth £3.9 billion in 2012). This could reflect the ‘Olympic effect’, in terms of increased output from this tourism industry.

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4. Tourism demand in the United Kingdom 2012

Tourism demand (or tourism consumption) is made up of two types of tourism, inbound tourism, where foreign passengers travel to spend time in the UK or, domestic tourism, where resident tourists travel within the UK on trips defined as tourism. Both inbound and domestic tourism can be broken into two further categories, overnight tourism and excursions (same day visits), although the aggregate figures for domestic tourism can be further split into outbound travel or regular domestic tourism before splitting into overnight visits and excursions (See reference table 2). In this report the focus will be on the aggregate figures for inbound tourism however the reference tables provide the further breakdowns of excursionist and overnight characteristic trips. Domestic tourism will be broken down by excursionist and overnight trips in both the report and the reference tables. When domestic tourism is reported at this level it will not include outbound travel unless specifically stated.

Inbound tourism

Inbound tourism consumption within the UK was estimated to be £21.8 billion in 2012, an increase of 3.7% on 2011 where the value stood at £21.0 billion (See table 2).

Inbound water passenger transport saw a big increase reaching £145 million up 70.7% on 2011 where the figure was £85 million. Figure 2 shows that ‘other consumption products’ was the highest contributor of tourism consumption in 2012, worth £9.3 billion. Beyond this there were three other main areas of tourism demand in 2012. These were:

  • Accommodation for visitors, worth £4.5 billion

  • Food and beverage serving services, worth £3.3 billion

  • Air passenger transport services, worth £3.0 billion

Domestic tourism

Domestic tourism describes the activities of a resident visitor within the UK which can include both tourism trips with an overnight stay and tourism visits without an overnight stay, which is referred to as an excursion or same day visit. There is also an amount of expenditure that takes place within the UK and is associated with UK residents making an overseas visit – this domestic outbound tourism often involves some expenditure on the UK territory before leaving the country, this can include spend at ports or expenditure on outbound flights on UK carriers and this is all accounted for within the TSA. Domestic tourism consumption, therefore, describes the tourism consumption within the UK economy of UK residents. Domestic tourism consumption within the UK was £106 billion in 2012, an increase of 6.8% or £6 billion from 2011.

Figure 3 shows that, apart from other consumption products, food and beverage serving activities, air passenger transport services (for outbound travel), and accommodation services are the key drivers of domestic tourism consumption in 2012. In this chart we provide further breakdowns of other consumption products to highlight the importance of ‘Special Shopping’ and ‘Personal Transport’, which account for 89.3% of all other consumption.

Table 4 focuses on domestic (UK-based) tourism consumption on trips with an overnight stay and shows that there has been a 5.9% increase in expenditure on these trips between 2011 and 2012, an increase of £1.4 billion. The table shows how this change is distributed across the tourism industries with big increases in spend on air passenger transport services, sport and recreation, and exhibitions and conferences and reduced spend on and transport equipment rental and railway passenger transport between 2011 and 2012.

Although other areas of spending such as air passenger transport services, sport and recreation, and exhibitions and conferences had seen big increases since 2011, they were not responsible for the majority of domestic tourism consumption.

Figure 4 shows that spend on accommodation services, food and beverage serving activities and special shopping and personal transport account for 78.3% of all domestic overnight consumption.

Table 5 highlights the importance of excursions, or same day visits, in terms of tourism spend or consumption in 2012. This is largest element of tourism spend in the UK amounting to £57 billion in 2012, an increase of £5 billion or 9.6% since 2011. The table shows how this change is distributed across the tourism industries with big increases in spend on passenger transport services and very large decreases in spend on exhibitions and conferences and travel agencies between 2011 and 2012.

In Figure 5 the main drivers of excursionist spend in 2012 are shown and these include food and beverage serving activities, special shopping, personal transport, cultural activities, and sport and recreation activities. These tourism sub-industries accounted for 87.6% of all domestic excursionists spending in 2012.

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5. Tourism employment in the United Kingdom in 2012

Table 6 shows the change in tourism direct employment between 2011 and 2012. This is employment that is directly supported by tourism consumption across the tourism industries. There was an increase of 75,000 jobs in tourism during this period, a 5.1% increase, with the largest gains in passenger transport related tourism industries.

The biggest contributors to direct tourism employment in the UK in 2012 were food and beverage serving activities, other consumption products and accommodation services for visitors, as shown in figure 6.

Table 7 shows the change in tourism direct full-time equivalents (FTEs) between 2011 and 2012 with an increase of 6% or 70,000 tourism direct FTEs.

Figure 7 shows that food and beverage serving activities, accommodation services, travel agencies, and other consumption products were the biggest source of tourism direct FTEs in the UK in 2012.

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6. TSA estimates for 2013 and 2014 (nowcasted)

Figure 8 shows how Tourism Direct Gross Value Added has grown since 2010 when it stood at £49 billion, to £54 billion in 2011 and £57 billion in 2012. Applying a nowcast technique allows estimates of TDGVA to be proposed for 2013 and 2014, £59 billion and £60 billion respectively.

Table 8 shows the change between each year emphasising the high level of growth in TDGVA in both 2011 and 2012, the flat growth in TDGVA between 2008 and 2010 and then the slowdown in TDGVA growth in 2013 and another slowdown in TDGVA growth in 2014. TDGVA growth peaked in 2011 where it was 9.8% and has fallen to 1.5% in 2014.

Table 9 shows the change in TDGVA between 2008 and 2012 and compares it to the change in GVA in other industry sections over the same period. The results highlight the strength of TDGVA growth over the period 2008 to 2012 following the 2008 economic downturn. Growth in TDGVA is higher than all but two of the comparable industry sections; Electricity, gas, steam and air conditioning and real estate.

Table 10 shows that by 2014 the absolute change in TDGVA since 2008 had grown from 16% to 20.6%. However, where other areas of the UK economy have strengthened and the rate of TDGVA growth has fallen from high growth rates (seen in 2011 and 2012), UK TDGVA growth has started to fall behind other areas of the economy in terms of GVA growth since 2008.

Both the professional, scientific and technical and the finance and insurance industries have now seen high cumulative growth in GVA since 2008 and the 2008 economic downturn. Cumulative growth in GVA for the retail industry section has also reached 17.1% in 2014 since 2008 closing in on the 20.6% cumulative growth in TDGVA.

Figure 9 shows a similar picture of TDGVA as table 9 and 10 where UK tourism contributes an increasing share of UK Gross Domestic Product in 2011 and 2012 but this share begins to decline in 2013 and continues to fall in 2014. Where the 2012 Olympics may have driven much of the TDGVA growth in 2011 and 2012 the slowdown in UK TDGVA growth also emphasises the economic importance of Olympic Games to the UK economy in both 2011 and 2012. Future Tourism Satellite Account production will continue to provide evidence of the contribution of Tourism to the UK economy and understand the impact and legacy of events such as the 2012 Olympics from a national economic perspective.

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7 .Background notes

  1. Methodology and Sources overview

    The 2012 UK Tourism Satellite Account (UK-TSA) is the successor to the 2008-2011 UK-TSAs. Improvements to data sources and other changes to methodology mean that data in the current report and in the previous UK-TSA releases cannot be directly compared. Therefore we have included revised versions of the Tourism Satellite Account tables for 2008-2011in this release together with the TSA results for 2012. This is available in the data download accompanying this release. This section of the release gives information about changes to data sources and methods and then summarises the sources for each UK-TSA table.

  2. New Sources and Methodology

    Recent revisions to the UK Supply and Use Tables published in October 2014 have meant that the tourism industry output and Gross Value Added totals used in Table 5 and 6 of the TSA have been revised. This has necessitated the revision of the TSA tables for 2008 – 2011 which are presented in this release. As in the UK-TSA for 2011, for travel agency products we have assumed that travel agents earn 20 per cent commission on the services they provide. Thus, they earn 20 per cent of value on top of the items they purchase to make their products. To balance demand and supply we have taken 20 per cent of the value of domestic output travel agency services, as calculated using the same method as for other goods and services – using the SUT. The remaining 80 per cent is an estimate of the value of the services purchased to make the product. So, the 20 per cent is purely the value added from re-bundling services to make travel agency services.

  3. Demand Side Sources.

    3.1 International Passenger Survey (IPS) 2008-2014

    The IPS provides estimates of the expenditure on visits to the UK by overseas. This has been used in Table One of the UK-TSA where it is combined with estimates of expenditure on fares paid to UK carriers for inbound travel (also extracted from IPS findings). Together these provide estimates of total inbound tourism expenditure but the IPS provides no detailed breakdown of expenditure by product so further sources have been used for such a breakdown (Supply and Use Tables). The IPS also provides expenditure data on visits abroad by UK residents which have been used to provide the totals in Table Three (outbound tourism expenditure). The lack of a breakdown by product again requires the use of Supply and Use Tables to complete the table. Estimates of expenditure on fares paid for outbound travel are not included in Table Three but are in the part of Table Two showing domestic tourism expenditure on outbound trips. Again, the fare information is sourced from the IPS but in this case all nationalities of carrier are included.

    3.2 Input- Output Supply and Use Tables 2008-2012

    Supply and Use tables are part of the UK National Accounts system. They are annual tables, compiled around 18 months after the year in question and they include three tables for each year, one of which is divided into two. The tables relate to supply of products, demand of products (split into intermediate and final demand) and households final consumption expenditure (HHFCE). The HHFCE table includes two columns of information about non-resident household expenditure in the UK and UK resident household expenditure abroad. The totals are broken down into expenditure relating to 110 products and these are used in Tables One and Three of the UK-TSA to apportion total expenditure from the IPS to tourism products. Although the HHFCE table does not solely relate to tourists, we have assumed that they make up such a large proportion of each total that the HHFCE data make a good proxy for a breakdown of the expenditure in the IPS.

    3.3 United Kingdom and Great Britain Tourism Survey (UKTS+GBTS) 2008-2014

    The UKTS is an annual survey jointly sponsored by national tourist boards. The respondents are UK residents who are asked about the volume and value of their tourism visits within the UK that include an overnight stay. The UKTS total expenditure feeds into the domestic overnight visitors’ column of Table Two and provides some breakdown by product. We also used an analysis of visits from holiday bases using data from the 2012 Great Britain Day Visits Survey to finalise the product breakdown in Table Two.

    3.4 Great Britain Day Visits Survey (GB-DVS) 2011-2013

    The GB-DVS is the first Great Britain-wide survey of day visits since 2002/3 and replaces the 2005 England Leisure Visits Survey (ELVS) as the data source for the relevant column in the UK-TSA Table Two. Analysis of responses to the GB-DVS has provided the required split of expenditure by product but a further data source, Consumer Trends, has been required to convert the 2012 data to 2008-2010 equivalents.

    3.5 Northern Ireland Continuous Household Survey 2012

    The new GB-DVS and GBTS do not interview residents of Northern Ireland although they do provide information about visits to it from other parts of the UK. We have therefore combined data on Northern Ireland day visits from the Continuous Household Survey with the GB-DVS data before converting to 2008-2012 totals using Consumer Trends. We have also combined information about overnight visits by Northern Ireland residents with data from the GBTS.

    3.6 Morgan Stanley Survey of Airport Spend 2005

    Table Two of the UK-TSA includes an estimate of domestic tourism expenditure on outbound trips. As well as fares data from the IPS, we have used the results of a survey undertaken by Morgan Stanley in 2005 which provided an estimate of expenditure by product in UK airports. We have assumed that the data can be extended to include other points of departure and have used Consumer Trends data to convert 2005 data to 2008-2012 equivalents.

    3.7 ONS Consumer Trends 2005 – 2012

    Detailed Household Final Consumption Expenditure (HHFCE) estimates are published annually and quarterly in ONS’ Consumer Trends. The data are broken down by product and this has allowed us to convert non 2008-2012 expenditure by product from tourism surveys to 2008-2012 equivalents in Tables One and Two. The assumption is that tourism expenditure on specific products in these cases has risen or fallen by the same proportions as overall HHFCE on the same product.

  4. Sources of Supply Data

    4.1 Annual Business Survey (ABS) 2008-2012

    The ABS is used to extract the proportion of SUT products or activities (e.g. cultural activities) that are tourism and non-tourism. We use SIC 2007 5 digit estimates of output to extract these proportions. The ABS is also used to determine the number of enterprises in tourism characteristic industries in Table 7.

    4.2 Annual Population Survey (APS) 2008-2012

    The APS is used to determine the proportions of self-employed individuals in the tourism characteristic industries for table 7. APS data is also used to split the output of accommodation services between accommodation and food and drink in Table 7. This is done by examining the proportion of people engaged in occupations relating to accommodation and food and drink in the accommodation industry. This is because output attributable to the serving of food and drink should be accounted for under food and beverage serving activities within the TSA.

    4.3 Annual Survey of Hours and Earnings (ASHE) 2008-2012

    ASHE is used to determine the average hours worked in tourism characteristic industries to better determine the Full Time Equivalents estimates in Table 7.

    4.4 Business Register and Employment Survey (BRES) 2008-2012

    BRES is used to determine the proportions of employees in the tourism characteristic industries in Table 7.

    4.5 Input Output and Supply Use Tables – the Make Matrix or detailed supply matrix

    To reconcile the output of industries to the output of products requires a ‘Make Matrix’ (MM). This is essentially a detailed supply table, showing the value of products produced by each industry. It is largely diagonal, so that products are mainly produced by their corresponding industry. Nonetheless, there are some off-diagonal elements to it. ONS supplies an MM for internal use only due to its disclosive nature. However, the results that we derive from the MM are not disclosive as it is just used to apportion industry, or activity, output across tourism products.

  5. Details of the policy governing the release of new data are available by visiting www.statisticsauthority.gov.uk/assessment/code-of-practice/index.html or from the Media Relations Office email: media.relations@ons.gov.uk

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Manylion cyswllt ar gyfer y Bwletin ystadegol

Chris S Payne
chris.s.payne@ons.gov.uk
Ffôn: +44 (0) 1633 455687