My last post was on
border crossings into northwestern Ontario at Pigeon River and Rainy
River. This type of data has always
interested me because my academic career began approximately when the Canadian cross-border
shopping frenzy of the late 1980s and early 1990s took place. In 1980,
Canadians made 22.1 million same day auto trips to the United States and this
rose to 25.2 million in 1985 and hit 53.2 million in 1990. As the graph below shows, the peak was in 1991 at close to 59 million
trips before a decline set in and today the numbers are not even half that peak
at 21.5 million for 2017. These trips by Canadians to the United States were a
tourism flow into the US and a function of exchange rates, income, and
relative prices of goods.
What is also
interesting when examining travel flows is province level numbers for the
number of tourism visits, their origin, as well as the spending amounts. The figure below plots total visits to
Ontario from1998 to 2015 based on data from Ontario’s Ministry of Culture,
Tourism and Sport which in turn is based on Statistics Canada travel survey data. Total tourism visits in Ontario in 1998 were
129,646,000 and in 2015 they were 141,902,000.
The average annual growth rate of total trips was 0.6 percent - which does not seem that high. The average
annual growth rate of trips in Ontario originating from Ontario was 1.7
percent, compared to 1.1 percent from the rest of Canada, 1.6 percent for
overseas trips and -5.3 percent for the United States. Ontario has been its own best growing tourism
market accounting for 71 percent of visits in 1998 and 85 percent in 2015. The
biggest decline has been in American visitors which over the period fell from
23 percent to 8 percent.
When total spending by
these visitors is examined in the chart below, it suggests that spending has
grown faster than the number of visitors particularly for overseas visitors to
Ontario. Indeed, spending by Ontarians
visiting within Ontario grew at an annual average of 3.7 percent, that by other
Canadians 3.7 percent, Americans -1.2 percent and overseas visitors by 6.9
percent. Indeed, overseas visitors have definitely
been punching above their weight when it comes to their spending on tourism
visits to Ontario indicating that this is definitely an area where Ontario
might wish to direct its marketing activities.
Spending by overseas visitors to Ontario surpassed that of Americans in
2013 and in 2015 was 50 percent higher.
How important is this
tourism visitor spending to Ontario’s economy-approximately 2 percent of
Ontario’s GDP – but is has not changed much over the period 1998 to 2015. It has not been growing as a share of GDP
given that during this period there has been a decline in American spending
that has counteracted the rise in spending by overseas and Canadian
travelers.
When it comes to marketing tourism in northern Ontario, the above data suggests two main targets for our energy: the rest of Ontario and the overseas market. For the time being, the American market appears to have sunk into decline.
When it comes to marketing tourism in northern Ontario, the above data suggests two main targets for our energy: the rest of Ontario and the overseas market. For the time being, the American market appears to have sunk into decline.