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Survey shock: over 90% of agents face closure amid mass layoffs

January 29, 2021 Business News, Headline News 2 Comments

More than 90% of travel agent businesses could go under and job losses in the travel industry could soar to almost 320,000 by September unless the JobKeeper subsidy is extended beyond the end of March.

Those are the respective findings of a survey by Small Business Australia and new research commissioned by the Tourism and Transport Forum (TTF).

The Small Business Australia survey, reported by Melbourne’s Herald Sun, found that just one in 10 travel agents believed they would survive beyond 1 April 2021 without continuing assistance from the government.

Small Business Australia executive director Bill Lang described the survey results as frightening.

Perth travel agent Christine Ross, owner of Attadale Travel in the Western Australian riverside suburb, put a human face on the crisis. She was interviewed by Oliver Peterson of Perth Live on radio station 6PR, which ran the segment under the title: 97% of travel agents believe they won’t exist come March.

Ross described the situation facing travel agents as “truly horrific”.

‘When people see the data I think it really resonates with people, understanding that our industry is about to really be annihilated,” she said.

“The level of anxiety that develops, over 10 months now; if you can imagine every single day, not only when you get to work but every night when you’re trying to sleep, every minute that you wake up, you’re constantly worrying about what will be delivered today, because every single state government change, every federal government change, every airline change in their communications, the way they offer refunds, cancellations, bumping our clients off flights, changing the customer account numbers – all of that we are just dealing with relentlessly.”

The endless changes and rebooking meant that “every single action you take at work has a consequence”, she added.

The Christmas period offered no respite, Ross said, with every booking in her system affected by changes and cancellations.

Many agents will understand exactly what she is going through. To listen to the segment on 6PR, click here.

NEW RESEARCH COMMISSIONED BY THE TOURISM AND TRANSPORT FORUM (TTF), MEANWHILE, shows the Australian tourism industry lost almost $7 billion over the peak summer holiday period as a result of the latest Covid-19 outbreak and subsequent state border closures.

The research, undertaken by tourism economists Stafford Strategy, revealed the Sydney Northern Beaches outbreak and the border restrictions imposed on Sydney and NSW residents had decimated the peak holiday period, with spending from 24 December 2020 to 31 January 2021 predicted to be down by $6.8 billion.

The research also forecasts that the lack of international visitors and continuing uncertainty over domestic borders during 2021 will lead to potential job losses of almost 320,000 by September 2021, if the JobKeeper subsidy is not extended.

NSW is expected to take the biggest hit with 118,000 job losses while Victoria and Queensland will also suffer from the loss of 85,300 and 59,700 jobs respectively.

TTF chief executive, Margy Osmond, said the extension of JobKeeper as well as a uniform set of state border restrictions was critical to ensure that the industry could survive 2021 after a disastrous year in 2020.

“Suggestions that increased domestic travel can replace the lack of international visitation is a complete myth, with the average international tourist spending three times the average domestic tourist and in the case of Chinese tourists – our biggest market pre-Covid – spending over five and a half times.”

With international travel cut to the bone by the pandemic and relations between Canberra and Beijing having soured and then plunged to a disturbing and historic low, it’s hard to foresee when, or if, tourism from China might resume.

“The absence of this high-yield market, the continuing uncertainty around domestic borders and the lack of confidence that the constant border changes create makes it impossible for domestic tourism to compensate for the lack of international travellers,” Osmond said.

“While health remains the number one priority in the management of Covid-19 and TTF has continued to support the Government in its management of the pandemic, the prospect of no international travel in 2021 makes the domestic tourism market all the more critical.

“A strong tourism sector is critical to the recovery of the national economy and the Government needs to support our industry over the next 12 months so that we can play our part in the rebuilding of Australia’s bottom line.

“On behalf of tourism operators across the country, TTF urges the Federal and State Governments to work together with industry and implement a simple set of uniform rules that allow Australians to undertake domestic travel.

“We will also need further support in the form of something that looks, walks and talks like JobKeeper, even if it does not go by this name, if we are to have any chance of surviving then recovering.” 

Written by Peter Needham

Currently there are "2 comments" on this Article:

  1. Peter says:

    This is a bit misleading.

    The ‘travel agency’ market in Australia primarily depends on outbound international travel.

    They process little of the domestic vacation travel.

    For sure tbe drastic reduction in inbound international impacts the overall tourism business in Australia, but this has little impact on Australian travel agents. Inbound tour operators are not travel agents in the true sense. But many inbound tour operators are greatly impacted

    So why not be clear on the true impact on Australian travel agents, rather than obscure it with inbound international travel and domestic travel.

    For sure the closing of state borders off and on has impacted domestic tourism, but this impact has primarily been felt by airlines and hotels and resorts. Little real impact on travel agents.

    But bottom line is that travel agents are suffering enormously because of COVID.

  2. Coralie De Marco says:

    I’ve been a travel agent for 38 years – my revenue only comes from international outbound travel. I stopped selling domestic travel 10 years ago as the complicated gst coupled with non commissionable products made domestic travel unviable for my business.
    Until Covid , my business was buoyant due to my clients being predominantly retirement age and hence able to pay me for my expertise in planning their travel. ALL these clients are now expressing fear about the future of travel .
    I have spent a year repaying commissions to airlines ,suppliers and insurers. I’ve had no new business of course so I’ve effectively worked for two years for nothing. Every cent earned in 2019 was refunded in 2020.
    I imagine even when and if the industry restarts that the paltry commissions we received will be reduced to zero.
    If Jobkeeper is not exterided I cannot see any travel agent,large or small surviving past March.
    Coralie De Marco
    CDM Travel

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