A Guide to the BC Economy and Labour Market
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  Tourism sector  

British Columbia has become a world-class tourist destination. Vancouver is consistently ranked among the top 10 cities in the world in surveys done by travel magazines. The 2008 Condé Nast Traveler survey placed Vancouver ninth among the world's best cities to visit, and first among all cities in Canada. Besides Vancouver, only Quebec City ranked higher than Victoria as a favoured Canadian destination. Vancouver Island was ranked the best Island to visit in North America.

The province's location, bordered by the Rocky Mountains on the east and the Pacific Ocean on the west, makes it unique within Canada. Its mountain and coastal scenery, opportunities for summer sailing, winter skiing, and other activities such as fishing or sightseeing in coastal and inland waters, all help support the tourism sector.

Many of the people who visit and spend money in BC come from other parts of Canada or from the US. Asia is the most important source of visitors from overseas markets.

What is a tourist?

We usually think of a tourist as someone who's vacationing away from home, but the technical definition of a tourist is a little different.

That definition counts anyone who travels to a place outside his or her usual environment and stays away for no more than a year. The motivation for the trip is irrelevant: the person could be travelling for business reasons, to visit family and friends, or simply for pleasure1. It is also not necessary for a person to stay overnight in order to be considered a tourist. Day trips (also known as excursions) are an important type of tourism. However, to be considered a tourist, you do need to travel outside your usual environment.

What's included in the tourism sector?

Since tourism is an activity and not a specific good or service, there is no such thing as a "tourism industry." Tourists make purchases from a variety of businesses, most of which also provide the same services to local residents. For example, restaurants serve a local clientele as well as tourists. In fact, most of their business is with local residents.

This presents a challenge when attempting to measure the impact that tourists have on the economy. Fortunately, from studies of tourist behaviour, we have a reasonably good idea of what tourists are doing and what they buy when they visit the province. From this information we can determine the effect that tourism has on various industries.

A percentage (which varies by industry, ranging from less than 5% to nearly 100%) of the activities of the following industries is included in the tourism sector:

  • Accommodation services
  • Food & beverage services
  • Transportation & warehousing
  • Retail trade
  • Finance, insurance, real estate & leasing
  • Various other service industries where there is a small tourist-related component. For example, tourists visit museums, zoos, gardens, ski hills, golf courses, and other similar venues when they travel, and these activities are included in the tourism sector

Employment in the accommodation industry is almost completely driven by tourism activity and more than a fifth of the jobs in the food & beverage service industry are due to tourism. The transportation & warehousing industry has a significant tourism component as well, but some industries (for example, trucking) derive their income from moving freight rather than transporting people.

What's happened in tourism since 1997?

Despite some ups and downs, the sector's share of GDP and employment has remained relatively stable


Despite some ups and downs, the sector's share of GDP and employment has remained relatively stable

Source: BC Stats

The sector's share of GDP has remained steady at about 4.4% throughout most of the period. Tourism's share of GDP is considerably lower than its share of total employment, which is currently at 6.7%. Many of the industries within this sector are labour-intensive, and this is reflected in tourism's relatively high share of total employment compared to GDP.

Tourism activities are very susceptible to changes in economic conditions. When the economy is weak and people feel uncertain about their jobs, they're not as likely to travel. If they do go on trips, they may travel shorter distances, and probably don't spend as much money in hotels, at restaurants, or on various types of amusements as they would otherwise do.

The tourism sector has faced many challenges

The tourism sector has faced a number of challenges which have contributed to slower GDP and employment growth in recent years. American visitors are an important source of tourism dollars in the province, and the North American economic slowdown that occurred in 2000 and 2001 was already having an effect on BC's tourism sector prior to the 9/11 attacks. In the aftermath of the terrorist attacks, visitor entries from the US plunged. They are still well below the levels seen at the turn of the century. Other factors such as the rising value of the Canadian dollar relative to the US currency have also affected travel to BC.

The SARS outbreak in early 2003, which was primarily localized in the Toronto area, caused many visitors from Asia (another important source of travellers to BC) to shy away from travel to all parts of Canada. Planned tours were cancelled, and travel from Asia dropped off significantly. Although the SARS effect was most pronounced among Asian visitors, travellers from other parts of the world also showed some reluctance to visit the province.

The current economic downturn is having a dampening effect on the province's tourism sector. However, because the recession did not become evident until late in 2008, after the end of the main tourist season, the full impact of the slowdown on the tourism sector is not yet evident, since data for 2009 is not yet available.

How many people work in tourism?

In 2008, there were 131,000 people working in BC's tourism sector. About half (65,400) had jobs in accommodation & food services, while 33,500 worked in the transportation & travel services industries. Another 18,700 people working in retail trade had jobs related to tourist activity, and there were 13,500 people working in other industries such as amusement and recreation whose jobs were supported by tourist activities.

Approximately one in every 152 jobs in BC is a result of tourist activity, making the tourism sector one of the larger employers in the province (comparable to the education services industry in terms of its share of total employment).

Accommodation & food services is the largest employer in the tourism sector


Accommodation & food services is the largest employer in the tourism sector

Source: BC Stats

Half of the jobs in the tourism sector are in accommodation and food services. One in five jobs is in transportation and related services (including travel agents), while the rest of the jobs are in retail trade (14%) or other industries (10%).

What's the outlook for tourism?

Tourism is already an important sector within BC's economy and this will likely continue to be the case in the future. However, tourism activity is particularly susceptible to changes in the economic climate both within and outside BC. A number of external shocks have had a negative effect on the province's tourism sector in recent years, and the current recessionary conditions are not helping matters. On the other hand, the province may receive a boost as a result of the 2010 Olympics held in Vancouver. This exposure may contribute to further development of BC's tourism sector.

  1. However, migratory workers living away from home on a temporary basis in order to be at their place of work are not considered to be tourists. 

  2. Since tourism employment figures are calculated using SEPH data, which does not include self-employed workers, this figure represents tourism's share of total employment as reported by SEPH (1.9 million in 2008). 

A Guide to the BC Economy and Labour MarketA Guide to the BC Economy and Labour Market