Why global turbulence could be good for region's tourism and leisure businesses
PUBLISHED: 11:46 22 January 2016 | UPDATED: 11:53 22 January 2016
(C) Chris Taylor Photo
Tumbling oil and commodity prices could transform the balance of the region's economy in 2016 and underscore the importance of the region's tourism industry, according to one industry expert.
Chris Scargill, partner at Larking Gowen, said turbulence in global prices is likely to affect the region’s key energy and agriculture industries - two of the sectors which together with tourism underpin the region’s economy.
However, cheaper goods and fuel could yet have a silver lining for UK consumers and fuel a continued rise in staycations as people opt to spend their money in this country.
Mr Scargill was speaking ahead of the launch of the Larking Gowen Business Tourism Survey which seeks to take the pulse of the industry.
The 10th annual survey, is an independent industry barometer which has the support of destination marketing organisations Visit Norfolk, Visit Suffolk and Visit Essex. It aims to canvass the views of tourism and leisure businesses across the three counties with the findings used to lobby policymakers to respond to the needs of the industry.
“The year ahead is going to be a very challenging one for the East Anglia Region,” he said. “Agriculture, energy and tourism have been three key sectors which have been underpinning the success of our area for some time, but two of those are now struggling in light of world wide influences.
“The significant cuts in employment in the off-shore industry will inevitably have an impact on local economies, but for those not directly affected, oil prices falling to levels not seen for over a decade will potentially encourage people into their cars and that could lead to a surge and rejuvenation of the ‘staycation’ factor.”
This year’s survey will continue to focus on recurring issues such as how businesses have performed over the past year, their use of marketing and social media, recruitment of staff and customer behaviour. In addition, the survey also asks questions regarding topical issues such as the impact of the Cut Tourism VAT campaign, pension auto-enrolment and the National Living Wage, and how businesses plan to fill the gap created by public sector spending cuts.
According to ONS figures, the sector is worth around £7bn to the economy in those counties, and Mr Scargill said it was vital tourism businesses ignored geographical boundaries and were united more than ever.
Luke Morris, partner at Larking Gowen’s Ipswich office and a former Suffolk IOD chairman, said: “A lot of people in the tourism and leisure sector are fairly bullish about the future and there is a genuinely positive feeling around Brand Suffolk. The uncertainties around China, and the eurozone, and the chancellor rolling back his growth forecasts, lends itself to the narrative of people supporting businesses locally. There is an expectation that this is going to lead to a ‘defensive’ spend, which is actually very good for the sector.”
Caroline Williams, chief executive of Norfolk Chamber of Commerce, said: “Any reduction in costs could make it cheaper to travel to Norfolk while any reduction in wholesale prices means that people running tourism and leisure businesses could see some costs fall.
To complete the survey go to tourismsurveys.co.uk