Accommodation figures for August reflects ‘devastating and dire’ position of sector

The accommodation statistics for August released by StatsSA reflect the devastating and dire position of the accommodation sector, says prof. Berendien Lubbe from the University of Pretoria.

According to StatsSA, income from accommodation decreased by 82,4% year-on-year in August 2020. This was the result of a 79,4% decrease in the number of stay unit nights sold, and a 14,3% decrease in the average income per stay unit night sold.

All accommodation types recorded large negative year-on-year growth in income from accommodation. The main contributors to the 82,4% year-on-year decrease in income from accommodation were:

• hotels, with -86,2% and contributing -54,6 percentage points and
• ‘other’ accommodation, with -74,9% and contributing -24,2 percentage points.

Income from accommodation decreased by 88,9% in the three months ended August 2020, compared with the three months ended August 2019. The main contributors to this decrease were:

• hotels, with -90,2% and contributing -57,9 percentage points and
• ‘other’ accommodation, with -85,9% and contributing -26,6 percentage points.

Seasonally adjusted income from accommodation increased by 99,0% month-on-month in August 2020, and increased by 47,2% month-on-month in July.

Lubbe, whose research focuses on the role of air transport in tourism, points out that the hospitality industry is labour intensive and provides jobs to both high and low-skilled workers.

“Even if these figures show that hotels are more resilient and may recover earlier than the smaller accommodation establishments, recovery to pre-COVID levels and growth may take a number of years, particularly as far as employment goes.”

She says smaller establishments were hit the hardest. “Too many have had to close and while leisure travel is still prohibited and many of our primary markets restricted from entering the country, exacerbated by conflicting messages from the authorities, many of these business owners, who may still have the resources, could be losing their appetite to reopen.”

She believes that there is no longer any other option but to fully reopen the South African tourism industry.

“If we want to recover from what these devastating statistics reflect and see beyond these figures into the human suffering caused by joblessness and hopelessness, we have to take some brave steps.

“We have to learn to live with a disease that is not going to go away and urgently salvage any job opportunity that may still be salvageable in this sector. We have to rebuild consumer confidence, face much fiercer competition, be very innovative and harness all the energy that we can to get back on track as quickly as possible.”

Prof. Waldo Krugell, from the department of economics at the North-West University, who does research in tourism economics, agrees that the tourism accommodation data tells the story of the impact of the lockdown. “August started at level 3, when people could only move within their provinces and inter-provincial travel was still restricted. On 18 August the country moved to level 2 that allowed for greater mobility.”

Krugell says month-on-month comparisons show that income from tourist accommodation increased by 47,2% in July and 99,0% in August, but this represents some movement after a complete standstill of the industry.

“Compared to August 2019, total income from tourist accommodation was 81,2% lower in 2020. The September numbers will show if South African tourists have responded to further easing of restrictions. The hope for more international tourists from October has been tempered and many service providers are only hoping to survive,” Krugell says.

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