It's National Travel and Tourism Week. Let's use the occasion to think about how the travel industry can jump-start the American economy.
Travel and tourism is the third-largest industry in Kansas. Consider the impact that 6 million leisure and business travelers create on the Wichita area's hoteliers, restaurateurs, retailers, museums and countless other businesses each year. The industry creates 11,810 jobs in the Wichita Metropolitan Statistical Area with a payroll of $180 million. Visitors generate $702 million in economic activity in the Wichita area, and they also generate a combined $62 million in tax revenue for the city of Wichita, Sedgwick County and the state of Kansas.
Travel and tourism is one of America's largest industries, employing more workers than both the insurance and auto industries. In 2010, it generated $1.8 trillion in economic output, and it delivered $118 billion in tax revenue. In fact, without travel and tourism's contribution to the tax base, each U.S. household would be taxed an additional $1,000 per year.
Simply stated, travel matters.
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As the country recovers from the worst economic downturn since the Great Depression, business decision-makers are now wondering if it is time to shift from cost management mode to growth mode. But where to invest?
New research supplies a surprising answer: business meetings.
In the past, no one really knew how to attach a return on investment on a sales trip, trade show or an award to a high-performing employee. As a consequence, travel budgets became a favorite target for cost-cutting. It also gave rise to myths that business travel is wasteful, that it can be easily replaced by virtual meetings and conference calls, and that the use of incentive trips to reward top performers is too extravagant.
The Economic Significance of Meetings to the U.S. Economy, a study by PwC US at the request of the Convention Industry Council, shows that 1.8 million corporate and business meetings, trade shows, conventions, incentive events and other meetings contribute $236 billion in direct spending to the U.S. economy. On the national level, the meetings industry supports 1.7 million jobs — making the meetings industry larger that U.S. industries such as broadcasting and communications, truck and rail transportation industries, and computer and electronics product manufacturing.
The Wichita area is a direct beneficiary of business meetings. Conventions and trade shows provide the opportunity for customer contact, education and networking that is the core of business relationships. Business travelers also come here to work out the details of a business jet purchase, or it may be an original equipment manufacturer representative meeting with one of Wichita's hundreds of machine shops.
These travelers use our hotels and restaurants, and they visit our attractions. The economic ripple creates jobs for accountants, advertising agencies, web designers, landscapers and many more. It stimulates economic development projects such as the new Warren IMAX Theatre, the Kansas Star Casino, Cabela's and new hotel properties to name a few. The payroll from those jobs reverberates through the community as employees buy goods and services throughout the local economy.
The return on investment for travel and industry is more than just money in the bank. It's jobs and careers, entrepreneurship, capital investment and taxes. It's quality of life, revitalization and sharing the pride we have in our community with others.
As the old saying goes, you have to spend money to make money. And in the case of business travel, this axiom has never been truer.