Utah’s Tourism:
Challenges & Opportunities
R. Thayne Robson, Director
Bureau of Economic & Business Research
David Eccles School of Business
University of Utah
February 7, 2001
Executive Summary
 Tourism,
Conventions, and Travel are big and
growing activities in the Utah, National and
World economies.
 Tourism spending in 1999 was over $4 billion
in Utah, $523 billion in the USA, and $456
billion in the International World travel.
 The Winter Olympic Games of 2002 provides
a Aonce in our history@ opportunity for Utah
to showcase our statewide tourism offerings.
 The
Olympic Games alone will not adequately
promote Utah=s Tourism potential.
 The
Games do provide a platform on which
Utah can showcase itself to the world.
 SLOC, USOC, and IOC along with the various
sports federations are interested in staging the
best games ever, and the sponsors have their
own products and services to promote.
 Who will promote Utah=s Travel and Tourism
potential?
The Winter Olympic Games will provide state and local
governments with $76 million more in tax revenues
than the cost of the services governments will be
required to provide during the games, according to the
economic impact analysis completed in the Governor=s
Office of Planning and Budget.
 Furthermore, reserves are to be built up to maintain and
operate Olympic venues following the games.
 Where is the money being invested in promotion
programs that will insure that the $4 billion investment
in new facilities will actually be utilized after the
games?

 There
are at least two audiences for our
promotion.
 The first group are those who actually come
for the games and visit Utah.
I believe this group will at least get some exposure to
what Utah offers and I hope they will be encouraged to
come back after the games.
 Many within the visiting group are people who make
their living by traveling and whose travels are controlled
by their employers and world events.

 The
second group of more than 1 billion and
possibly as many as 3 billion people will be
exposed to Utah and the Games via TV, radio,
magazines, newspapers and the world wide
web.
What will they know about what Utah has to offer after the
games?
 Will they learn about Utah=s Spring, Fall and Summer
seasons or about the incredible variety of things we can
offer both in Utah and in surrounding states.


We need to commit now to providing at least an
additional $20 million above and beyond what is
already committed to promote Utah=s tourism
during this Aonce in our history@ opportunity.
If we do not invest in promotion, our facilities
will remain under utilized, i.e., low occupancy
and poor earnings after the Games.
 If we make wise, well measured, and prudent
investments in a promotion, we can expect great
returns for the foreseeable future.

Utah’s Magnificent Opportunity
The World is at Utah’s door.
Will we say:
Please come in.
You are welcome here.
To Promote or Not to Promote
The World is at Utah’s door.
Will we turn on the lights?
Or, will we let our guests sit
in the dark?
Utah’s Great Challenge
Can we capitalize on $4
billion of Olympic
investments?
Are we willing to sell,
promote, show, and tell
the world what we have
here?
The Olympics
Will this event occur once in a lifetime, or a
century, or once in our history when Utah has
a world wide market exposure?
Many of the 6 billion people on earth will hear
about or see electronic or printed information
about the Winter Games of 2002.
Will they want to come and
experience Utah?
They will if they know what
we have to offer!
Travel & Tourism Industry
Includes many industries:
Airlines, hotels, restaurants, gift shops, retail and service
establishments, auto and bus transportation, automobile repair,
health care, etc.
The rule is:
Tourists and travelers use
some industries more than
others
But all industries are utilized.
For example – look at the preparation for the Olympics.
Utah Travel & Tourism
Spending in Utah:
$4.20 billion in 1999
$4.25 billion in 2000
Employment in 1999:
Direct: 67,000
Indirect: 52,500
Total: 119,500
Employment in 2000: 121,000
Utah Travel & Tourism (Cont.)
Generates about 11% of
total non-agricultural
employment
Taxes generated:
Total: $340 million
State: $252 million
Local: $88 million
Utah Tourism Indicators:
Direct and Indirect Travel-Related Employment in Utah
122
2000(e)
117
120
120
1999
140
113
107
100
100
96
91
79
80
82
1982
1988
52
1987
50
1986
58
60
61
63
65
67
1985
71
1981
54
40
20
Source: Utah Department of Workforce Services, adapted by the Utah Travel Council
1998
1997
1996
1995
1994
1993
1992
1991
1990
1989
1984
0
1983
Thousands
86
Utah Tourism Indicators - Hotel Room Rents
Millions of Current Dollars
$700
$600
$558
$581 $582
$600
$513
$460
$405
$400
$365
$295
$300
$200
$113 $125
$141
$161 $165
$176
$197
$221
$241
$313
$261
$100
Source: Utah State Tax Commission
2000(e)
1999
1998
1997
1996
1995
1994
1993
1992
1991
1990
1989
1988
1987
1986
1985
1984
1983
1982
$0
1981
Milions $
$500
Utah Tourism Indicators - Traveler Spending
$5.0
$4.5
$4.0
$3.0
$2.5
$2.0
$1.5
$1.0
$0.5
Traveler Spending (Billions $)
Sources: Utah Travel Council
2000(e)
1999
1998
1997
1996
1995
1994
1993
1992
1991
1990
1989
1988
1987
1986
1985
1984
1983
1982
$0.0
1981
Billions
$3.5
Utah Tourism Indicators - Total Number of Visits
20.0
18.0
16.0
14.5
15.3
16.1
16.7
17.2
17.5
17.1
0.72
0.76
0.88
0.72
0.64
0.7
0.75
1995
1996
1997
1998
1999
2000(e)
12.0
1994
Millions
14.0
10.0
8.0
6.0
4.0
2.0
0.0
Foreign
Source: Utah Travel Council
US
Utah Tourism Indicators - Taxes Generated by Travel Spending
400.0
350.0
$83
$85
$87
$88
$237
$243
$249
$252
300.0
$70
$74
$79
200.0
150.0
100.0
$198
$210
$225
50.0
State Government
Sources: Utah Tax Commission and Utah Travel Council
Local Government
2000(e)
1999
1998
1997
1996
1995
0.0
1994
Millions
250.0
Utah Tourism Indicators - Hotel/Motel Occupancy Rates
0.8
0.7
0.6
74%
73%
68%
0.3
63%
62%
61%
2000(e)
74%
1999
0.4
1998
0.5
0.2
0.1
1997
1996
1995
1994
0.0
Hotel/Motel Occupancy Rates
Sources: Utah Tax Commission and Utah Travel Council
Source: Utah Governor’s Office of Planning & Budget, Nov. 2000
Public and Private Investment Beneficial to the 2002
Olympic Winter Games (Millions $)
Participation
Project
Total Cost
Federal
Venues
$321.9
$0.0
$151.5
$170.4
Housing
$143.8
$14.7
$32.1
$97.0
$2,253.3
$891.9
$0.0
$1,361.4
Hotels
$297.0
$0.0
$0.0
$297.0
Resort*
$756.8
$0.0
$57.8
$699.0
Miscellaneous
$256.7
$18.7
$6.0
$232.0
$4,029.5
$925.3
$247.4
$2,856.8
Transportation
Total
Source: Governor’s Office of Planning and Budget
*Resort Additions, Expansions, or Lease Fees
SLOC
Other
Some Questions
Will Utah capitalize on this opportunity?
What do Utahns need to do
A) to keep up with other states and
B) to improve profitability of our tourism sector?
Will our investment stream come
to an end when the Olympics
are over?
Trends
Travel and tourism world-wide is growing as it
is in the USA and Utah.
USA Tourism Trends
Travel and tourism expenditures (including
domestic and international) were $522.9
billion in 1999.
This is an increase of 5.1% from 1998.
Including international
airfare payments,
the total was
$544 billion.
U.S. Travel & Tourism Industry (1999 Data)
The industry as a whole is the third largest
private employer.
Only health and business services are larger.
Total jobs: over 7.7 million.
This employment is
24% greater than
it was in 1990.
U.S. Travel & Tourism Industry (1999 Data)
Total payroll: $159 billion.
An increase of 5.4% over 1998.
Travel spending generated $92.5 billion in tax
revenue for federal, state, and local
governments.
An increase of
4.9% over 1998.
Economic Contribution of the Travel Industry
in the US (1999p)
Direct Impact Indirect Impact
Total Travel expenditures in the U.S. (billions)
$522.9
$1,229.1
$159.0
$360.9
7.7
18.0
Federal
$55.9
N/A
State
$22.6
N/A
Local
$14.0
N/A
$92.5
N/A
Contributions to indivuduals
Wages and salaries (billions)
Employment (millions)
Contributions to governments (billions)
Total tax contribution
Source: TIA, TI/ITA
Note: Excludes international airfare payments to the U.S.
U.S. Travel Volume, 1995-99 (in millions)
1995
1996
1997
1998
1999
965.7
967.3
998.5
1,004.1
1,009.1
Business
208.9
202.3
203.4
210.1
212.3
Pleasure
624.4
628.7
655.4
655.5
654.5
43.3
46.5
47.8
46.4
48.5
From Overseas
20.6
22.7
24.2
23.7
24.5
From Canada
14.7
15.3
15.1
13.4
14.1
From Mexico
8.0
8.5
8.4
9.3
9.9
U.S. Resident Domestic Travelers-Total
International Travelers to the U.S.-Total
Total Travelers in the U.S.
1,009.0
1,013.8
1,046.3
1,050.5
1,057.6
Source: TIA, TI/ITA
Note: Total domestic travelers include individuals who traveled in the U.S. for pleasure, business,
personal and other purposes.
Travel Expenditures in U.S. Compared to Gross
Domestic Product: 1990-2000
Total Travel
Nominal Gross
Real Gross
Spending in the U.S.
Domestic Product
Domestic Product
Year
($Billions)
($Billions)
($Billions)
2000f
$561.3
$9,968.7
$9,337.3
1999
$522.9
$9,299.2
$8,875.8
1998
$497.4
$8,790.2
$8,515.7
1997
$480.0
$8,318.4
$8,159.5
1996
$455.9
$7,813.2
$7,813.2
1995
$423.8
$7,400.5
$7,543.8
1994
$398.5
$7,054.3
$7,347.7
1993
$381.3
$6,642.3
$7,062.6
1992
$360.7
$6,318.9
$6,880.0
1991
$344.5
$5,986.2
$6,676.4
1990
$333.3
$5,803.2
$6,707.9
Source: TIA, TI/ITA
Note: Total travel spending excludes international airfare payments to the U.S.
Travel Expenditures in U.S. Compared to GDP:
Percent Change from Previous Year
Total Travel
Nominal Gross
Real Gross
Spending in the U.S.
Domestic Product
Domestic Product
2000f
7.3%
7.2%
5.2%
1999
5.1%
5.8%
4.2%
1998
3.6%
5.7%
4.4%
1997
5.3%
6.5%
4.4%
1996
7.6%
5.6%
3.6%
1995
6.3%
4.9%
2.7%
1994
4.5%
6.2%
4.0%
1993
5.7%
5.1%
2.7%
1992
4.7%
5.6%
3.0%
1991
3.4%
3.2%
-0.5%
Year
Source: TIA, TI/ITA
Note: Total travel spending excludes international airfare payments to the U.S.
Travel Generated Payroll in U.S. Compared to
Personal Income: 1990-99
Travel-Generated
Nominal
Nominal Disposable
Payroll
Personal Income
Personal Income
Year
($Billions)
($Billions)
($Billions)
1999
$159.0
$7,789.6
$6,637.7
1998
$150.8
$7,391.0
$6,320.0
1997
$141.9
$6,937.0
$5,968.2
1996
$132.3
$6,547.4
$5,677.7
1995
$125.7
$6,200.9
$5,422.6
1994
$119.3
$5,888.0
$5,165.4
1993
$116.9
$5,610.0
$4,935.3
1992
$106.6
$5,390.4
$4,754.6
1991
$102.7
$5,085.4
$4,474.8
1990
$98.3
$4,903.2
$4,293.6
Source: TIA, TI/ITA
Note: Travel-generated payroll excludes wages and salaries generated by international airfare
payments made outside the U.S.
Travel Generated Employment in U.S. Compared to
Non-Agricultural Employment:1990-99
Travel-Generated
Total Non-Ag
Total Manufacturing
Employment
Employment
Industry Employment
Year
(Thousands)
(Thousands)
(Thousands)
1999
7,716
128,786
18,543
1998
7,455
125,865
18,805
1997
7,344
122,690
18,675
1996
7,138
119,608
18,495
1995
6,939
117,191
18,524
1994
6,649
114,163
18,321
1993
6,529
110,713
18,075
1992
6,142
108,601
18,104
1991
6,179
108,249
18,406
1990
6,217
109,403
19,076
Source: TIA, TI/ITA
Note: Travel-generated employment excludes jobs generated by international airfare payments
made outside the U.S.
Travel Generated Tax Revenue vs. Total U.S. Tax
Revenue, 1999
Travel-Generated
Total U.S.
Travel % in
Tax Revenue
Tax Revenue
Total U.S.
($ billions)
($ billions)
Tax Collections
Federal
$56.4
$1,949.5
2.9%
State & Local
$36.1
$816.2
4.4%
Total
$92.5
$2,765.7
3.3%
Percent
% Change
1999
In Total
99/98
($ billions)
(Percent)
(Percent)
Federal
56.4%
61.0%
5.0%
State
22.6%
24.4%
4.6%
Local
13.5%
14.6%
4.7%
Total
92.5%
100.0%
4.9%
Level of Government
Travel Generated Tax Revenue
Level of Government
Source: TIA, Bureau of Labor Statistics
Worldwide Tourism in 1999
664 million travelers and tourists
$456 billion in worldwide spending (Excludes air fare)
International travelers spent $74.4 billion in the U.S.
U.S. travelers spent $60.1 billion traveling abroad
(Excludes air fare)
International Tourist Arrivals and Receipts
Worldwide, 1990-99
Arrivals
Year
% Increase
Cumulative
from
% Increase
Receipts
% Increase
Cumulative
from
% Increase
(Millions) previous year from 1990 ($ Billions) previous year from 1990
1999
664
4.5%
45.3%
$456
3.1%
72.8%
1998
636
2.9%
39.1%
$442
0.5%
67.6%
1997
618
3.5%
35.2%
$440
0.7%
66.8%
1996
597
5.7%
30.7%
$437
7.6%
65.6%
1995
565
2.7%
23.7%
$406
14.4%
53.9%
1994
550
6.7%
20.4%
$355
10.3%
34.6%
1993
516
3.0%
12.8%
$322
2.1%
22.1%
1992
501
8.3%
9.6%
$315
13.9%
19.6%
1991
463
1.2%
1.2%
$277
5.0%
5.0%
1990
457
7.3%
0.0%
$264
19.4%
0.0%
Source: World Tourism Organization (WTO)
Note: Total arrivals exclude same-day visitors. Total receipts exclude international transport.
Utah’s Magnificent Opportunity:
A Few Modest Suggestions




We who promote tourism in Utah must recognize that
it is our job to promote all of Utah.
The focus of SLOC, USOC and the IOC committees
and the various sports federations is to conduct the
Olympic Games.
The Olympic sponsors will promote their products
and services -- not Utah.
No one will promote Utah if we neglect this great
opportunity.
Suggestion: A Concerted Effort




Are we satisfied that we have organized a statewide
effort to promote all of Utah’s attractions given the
attention focused on Utah during the Games?
Are our efforts being carefully coordinated, and do we
have full and complete cooperation from all who should
be involved?
Perhaps the Governor might find time to provide
leadership in this effort along with the leadership from
our State Legislature.
Leadership must provide a statewide, unified effort.
Successful Tourism Promotion Requires a
Larger Budget

The budget for promoting Utah before, during, and
after the Olympic Winter Games should be
increased by at least $20 million in addition to
everything already proposed.

This sum will still be less than 5 percent of the
advertising spent on the 2001 Super Bowl.
Capitalize on Olympic Investments

Should Utah’s Olympic tourism promotion
effort be unsuccessful, Utah can expect its $4
billion investment in the 2002 Olympic
Winter Games will be under-utilized
following the Games.

Success would multiply returns on
investment many times over for years to
come.
Corporate Sponsors
Corporate sponsors will spend millions of dollars
entertaining their clients and corporate CEO’s in Utah
at the Olympic Games.
 Their cooperation can be obtained in promoting Utah
by providing available information about our state.
 Who will ask for their cooperation?

Media
 Utah
must place TV, radio, and print ads
highlighting Utah’s many attractions to be run
during the prime time Olympic broadcasts.
 The world must be told that they are welcome
in Utah.
Special Guests
Our most prestigious visitors should be
identified.
 They should receive greetings before
they come, again while they are here,
should be given mementos of their visit
to Utah, and should receive an invitation
to return after they go home.
 Who will do this?

Accountability

Our promotion efforts and our advertising must be
tracked carefully, the results measured, and our efforts
must be accountable for results.
Our Future
Success or failure in Utah’s tourism promotion efforts
during the Olympic Games will mark Utah for good
or ill for generations to come.
 Olympic Games cannot be held in the United States
again until 2012 and possibly for years beyond that
date.
 The reputation of Utah’s tourism future rests squarely
on our shoulders.

Utah’s Magnificent Opportunity
Will we deliver?