Tourism called growth industry

July 24, 1995|By Gary Gately | Gary Gately,Sun Staff Writer

Tourists who stay overnight in Baltimore or travel at least 100 miles for day trips spend more than $824 million a year here, pumping some $67 million into city and state tax coffers, according to a new report.

The study, prepared for the state by the Travel Industry Association of America, provides the first detailed analysis of the impact of tourism on the city economy.

The Washington-based research organization's study accounts for about 3.75 million annual tourists, whose spending totaled about 16 percent of the state's more than $5.2 billion tourist trade.

State officials, however, say the report understates tourism's impact because it is based on 1993 figures and excludes tourists who come from less than 100 miles away and stay only the day. Including those who travel 50 to 100 miles -- from, for example, Annapolis, Frederick, Washington, York and Philadelphia -- raises the number of out-of-town tourists to about 5 million a year and their spending to more than $1 billion, state officials say.

Business leaders and others who closely follow Baltimore tourism said the report demonstrates the critical importance of the industry, the city's second biggest, behind health care.

"Tourism has grown exponentially," said Michael Conte, director of the Regional Economic Studies Program at the University of Baltimore. "Tourism has been a tremendous factor in keeping the city's economy afloat. . . . There are really few growth industries in Maryland at the current time. Tourism is one of them."

The report predicts growth in the industry here and elsewhere, fueled by aging baby boomers and a growing senior citizen travel market. But, the report said, the economic significance of tourism, expected to be the world's biggest employer within the next 15 years, is often underestimated.

Partly because the industry spans a broad cross-section of businesses -- including hotels, taxi companies, stores and restaurants, the report said: "Government, business executives and the public at large have been slow to grasp the significance of travel away from home and the industry that has developed to serve it.

"This lack of recognition is perhaps the industry's greatest barrier to reaching its full potential."

Among the report's other findings:

* Baltimore tourism generated at least 14,500 private sector jobs, paying a total of $224.4 million, up about 1 percent from the previous year.

* Restaurants, bars and grocery stores reaped the biggest benefit of tourist trade, taking in about $220 million, followed by lodging, $169 million; auto transportation (including rental cars, gas and repairs), $158 million; retail stores, $112 million; entertainment and recreation, $94 million; and public transportation, $70 million.

* International travelers accounted for $126 million of tourists' expenditures in the city. Two-thirds of overseas travelers came from Europe, while others journeyed from Asia (12.3 percent), South America (7.2 percent), Africa (4.3 percent) and other lands (9.3 percent).

In Baltimore, the report is expected to help bolster the argument that the city must spend more to promote itself and capitalize on the growing tourism industry to fill the void left by the precipitous decline in the manufacturing base.

Some business leaders complain that the administration of Mayor Kurt L. Schmoke has underestimated the importance of the industry and failed to give the agency charged with promoting the city enough money to do the job adequately.

The debate has intensified in recent weeks, following Mayor Schmoke's controversial ouster of the board of the Baltimore Area Convention and Visitors Association, saying it had repeatedly overspent its budget.

But the agency receives much less money than other similar agencies in other cities. BACVA's $3.2 million budget -- about $2.5 million from the city, the remainder from the private sector -- lags well behind some cities, including Washington, Philadelphia, San Antonio, Boston, Cleveland, Cincinnati and Detroit.

More than any other single factor, the lack of public money to market the city has kept it from reaching its potential to draw travelers, said George Williams, director of the state's Office of Tourism Development.

"The bottom line is Baltimore would do better if it spent more," he said. "I think most of the business community understands that more money spent on marketing produces better results."

Partly as a result of a lack of money and aggressive marketing, he said, both Baltimore and the state lag behind the national average in how long travelers stay and how much they spend.

In 1994, tourists stayed in the city an average of two nights, well short of a national average of 3.4 nights. The state, too, has struggled to keep travelers for a third night, averaging 2.2 nights. City tourists spent an average of $285 per stay, compared with $304 statewide and $422 nationwide.

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