The Canadian Provincial & Territorial The Canadian Provincial & Territorial Tourism Satellite Accounts:Tourism Satellite Accounts:

A Research OdysseyA Research Odyssey

IBGE 2nd National Meeting of Producers and Users of Social Economical and Territorial Information

Rio de Janeiro, Brazil; August 23, 2006

Presented by:Scott Meis UNWTO ConsultantAided by: Chris Jackson & Jacques Deslisle Statistics Canada

OVERVIEW

Context and justification

Concepts and definitions

Methodology

Results & findings

Conclusions & future work

CANADA CANADA10 Provinces3 Regions

Yukon

British Colombia

North WestTerritories

Nunavut

Alberta Manitoba

Saskatchewan Ontario

QuebecNewfoundland

Labrador

NovaScotia

NewBrunswick

Prince Edward Isle.

TECHNICAL PARTNERSHIP

Statistics Canada & Canadian Tourism

Commission Objective independent statistics agency Industry champion, resources, uses Shared goals and objectives Interdependence Mutual respect & understanding

STC-CTC Technical Partnership -1989-2006

CTC: Creation (1995)--Legislation, Jan,2001

CTC MISSION Market & brand Canada as a tourism destination

Provide accurate and timely information

Aid government and industry decision making

MANTRA

Industry lead, market driven, research based

Tourism Satellite AccountTourism Satellite Account

An account, not a model

Set of statistics measuring structure and scope of tourism

outputs, expenditures and employment

Measure monetary values of commercial transactions

Integrates visitor demand data with supply data from

a dispersed set of industries

Separate linked extension of SNA

Tourism specific summary comparable with other

industries and total economy

History: A New Statistical Instrument

HISTORY OF TSA Concept of tourism satellite accounts, France 1979

Canadian TSA recommendations, 1989

TSA principles and guildelines, Ottawa Conference, 1991

Release of 1st Canadian TSA, 1994

WTO/OECD international standard projects, 1996-1999

Quarterly national tourism indicators, 1996

Adoption by UNSC of TSA international standard, 2000

Release of TSA:RMF, Vancouver, 2001

Release of 1st Provincial/Territorial TSA for Canada, 2002

TSA History:

PTTSA History:

Provincial Responses to NTSA-NTI,

1994-1999 PTSA Feasibility study proposals (Québec/CTC/STC) 1995 Feasibility study of provincial dimension to NTSA 1997-1998 Development proposal, partnership and contract discussions Alberta/Québec/CTC/STC) 1999-2001 Project initiation, 1999-2000 Project completion, April, 2002 Revised & updated 2nd PTSA Benchmark update, June, 2003

PTSA History

WHY A PROVINCIAL/TERRITORIAL TSA?

Tourism unevenly distributed Shared federal-provincial responsaibility NTFD findings re regional data Regional interest stimulated by CTSA release Improve credibility and consistency of tourism economic

measurement– Common conceptual framework -- the System of National Accounts.

– Comparbility within & between provinces, with national economy & economic sectors

Strengthen capacities for tourism analysis and research

PTTSA Rationale:

PTTSA: Design Decisions

Concepts and methods from national accounts and TSA Reference year - 1996

Estimates cover all provinces and territories

Level of detail: 2 digit industries and commodities

Feasibility Study DecisionsFeasibility Study Decisions

List of 2 digit (“S” level) industries (NAICS 97)

Goods Producing Industries Agriculture, Fishing & Trapping, Logging & Forestry

Mining, Manufacturing, Construction, Utilities

PTTSA – Design Decisions

Services Producing Industries

Transportation & Storage, Communications, Wholesale Trade,

Retail Trade, Finance & Insurance, Real Estate, Business Services,

Government Services, Education, Health & Social Services,

Accommodation, Food & Beverage, Other Services

PTTSA - Methodology:

LIST OF “S” TOURISM COMMODITIESLIST OF “S” TOURISM COMMODITIES Passenger Transportation:

Passenger air transportation

Private vehicles: Vehicle fuel, repairs and parts.

Others: Water, rail, bus, taxis, vehicle rental

Accommodation: Motels, hotels, camping grounds, outfitters and other accommodation

Food and Beverage Services: Meals, alcoholic beverages

Other Tourism commodities: Recreation and entertainment, travel agency services and pre-trip expenses

Other Non-tourism Commodities Purchased by Visitors: Groceries, alcoholic beverages purchased from stores, souvenirs, urban transit, parking and other services and commodities

PTTSA - Methodology:

LIST OF “S” TOURISM INDUSTRIESLIST OF “S” TOURISM INDUSTRIES

Transportation: Air, water, rail, bus, taxis, vehicle rental and vehicle fuel, urban transit, parking.

Accommodation: Motels, hotels, camping grounds, outfitters and other accommodation.

Food and Beverage Services

Other Tourism Industries: Includes recreation and entertainment services, travel agencies and tour operators.

Other Industries: Includes non-tourism industries benefiting from tourism, e.g. retail, by providing commodities bought by visitors including groceries, alcoholic beverages, motor vehicle fuel, parts and repairs, pre-trip expenses, toiletries, etc.

CONCEPTS

The provincial/territorial TSA (PTTSA) is based on the accounting principles of the System of National Accounts (SNA)

Tourism is not and activity identified in the SNA

Consequently, construction of the PTTSA necessitates the division of the relevant SNA economic activities into their tourism and non-tourism components

PTTSA - Methodology:

DEFINITION

Tourism is defined as « the activities of persons traveling

away from their usual environment, for a period less than

12 consecutive months for the purposes of leisure, business

or other purposes» (UNWTO)

« Usual environment » operationalized as:– Trips greater than 80 kilomètres from one’s residence (one

direction)

– SAME definition of tourism applies to all provinces & regions

SAME tourism commodities and industries for all provinces

& regions of Canada

PTTSA - Methodology:

DATA SOURCES Tourism supply, GDP and employment

– Provincial input-output accounts (1990)

– GDP by industry accounts

– Business surveys

– Administrative records

– Labour productivity data base

Tourism demand

– Canadian Travel Survey

– International Travel Survey

– Survey of Income and Expenditures

Reference years 1996 and 1998 chosen based on the optimal availability of all these data sources

PTTSA - Methodology:

METHODOLOGY

Goal of the PTTSA - to measure tourism economic activity in terms of tourism supply, tourism demand, tourism GDP and tourism employment

Estimates MUST be calculated in the following order

PTTSA - Methodology:

TOURISM SUPPLY – METHODOLOGY

Tourism domestic supply = total

production of tourism commodities and

services in Canada

Total tourism supply NOT equivalent to

total tourism demand

Essential to FIRST correctly specify

and calculate total tourism supply

PTTSA - Methodology:

TOURISM SUPPLY – CALCULATION Break down I/O « S » level industries into component

sub-industies

Discern and keep only those sub-industries that serve visitors

directly

Example: F&B industry splits-- restaurants, bars, take-out

restaurants and caterers;

Drop caterers

Split out and remove industry supply not linked to tourism commodities, (consumed direcly by visitors)

e.g. caterers – keeps meals but drops royalties

Calculate total tourism supply all tourism commodities of

each industry/sub-industry

PTTSA - Methodology:

DEMAND – METHODOLOGY

Tourism demand is defined as the total expenditures of « visitors »-- including both tourists and excursionists

Components of total tourism demand

– Domestic (intraregional) demand

– International demand

– Interregional demand (new aggregate)

PTTSA - Methodology:

Demand – Methodology

Demand comes from survey data:

– Canadian Travel Survey (CTS) (renamed Travel Survey of Resident Canadians) for domestic demand

– International Travel Survey (ITS) for international demand

Many iterative adjustments & calculations are made to reconcile demand with supply

– Pre-trip expenses

– Domestic fares of international trips of Canadians

– Other non-measured demand (ex. tips)

– Domestic tourism for territorial residents (Source:SHE)

– Balancing of demand with supply

PTTSA - Methodology:

Demand Surveys

Input Output System

Supply Surveys System of National Accounts

Labour Force Survey

Other InformationSuch as

Manufacturing dataInternational Trade data

Tax information

Business informationSuch as

Profits, capital investment,revenues, expenses

Survey of Employment,

Payroll and Hours

All Other Areas ofSystem of

National Accounts

ReconciliationProcesses

Canadian Tourism Satellite

Account

Commodities expenditures VS industry revenues

Tourism demand VS supply by commodity

Tourism inputs VS outputs by industry Gross outputs VS all inputs Repeats all of the above at each geographical level

Iterative & interactive process -- “requiring high degrees

of professional judgment”

PTTSA Methodology: Reconciliation

BALANCING SUPPLY WITH DEMAND

LINKAGE BETWEEN COMMODITIES & INDUSTRIES

Demand is estimated for groups of goods and services (commodities)

GDP and employment, however, must be calculated by industry

Supply can be calculated either for groups of commodities

or by industry/sub-industry categories which establishes the link between demand and GDP

The link is a demand/supply ratio for each commodity

This ratio is then applied to each industry category to calculate GDP and employment in the industry space

PTTSA Methodology:

TOURISM GDP - METHODOLOGY

Tourism GDP can be defined as a simple value of domestic production of tourism goods and services within

the limits of a particular region

Only direct GDP is measured as opposed to indirect GDP and induced GDP

Componants of GDP include:

– Labour income, i.e. salaries and wages

– Supplementary work-related income

– Mixed revenue

– Other operating surplus -- profits & depreciation

PTTSA Methodology:

Proportion of Tourism GDP by Industry Category

98.4

65.9

30.925

22.417.5

0

10

20

30

40

50

60

70

80

90

100

Travel services Accommodation All tourismindustries

Transport Recreation &entertainment

Food &beverages

Source: Statistics Canada (1996 PTSA and 2001NTI)

%TS/TVA

TOURISM EMPLOYMENT

Tourism employment is the sum of all employees who

contribute to tourism production:

Includes all direct employment:

– Indirect employment and induced employment are not included

– Includes self-employed workers and non-renumberated family workers

– Seasonal full-time and part-time employment are both includedbut they are not calculated as full-time equivalents

Same industrial ratios as Tourism GDP used to calculate the

tourism employment portion of each sub-industry/industry

PTTSA Methodology:

Tourism Employment

(T) Total employment in all industries

(A+B) Employment related to tourism industries

A= Employment of tourism industries generated by other users (local & non-visitor consumption)

B= Employment of tourism industries generated by consumption of visitors

(B+C) = Total employment generated by tourism consumption

C= Part of employment in non-tourism industries but generated by visitor consumption

(T)

(A)

(B)

(C)

PROVINCIAL/TERRITORIAL RESULTS

Tourism expenditures

GDP/Employment proportions

Sources of demand

Trade balances

PTTSA Results:

Provincial Distribution (%)of Tourism Expenditures (1996)

19.9 18.9

11.2

0.3 0.31.41.51.82.82.93.3

36.7

0

5

10

15

20

25

30

35

40

Source: Statistics Canada (1996 PTSA))

PTTSA Results:

Provincial Tourism Satellite Account, 1996Tourism GDP /

total GDPEmployment in tourism /

total employment

Yukon 4.8 8.1British Columbia 3.5 4.7Prince Édward Isle. 3.1 4.6Nova Scotia 2.6 4.1Newfoundland/Labrador 2.3 3.9Manitoba 2.3 3.2Canada, 1996 2.3 3.7Québec 2.2 3.3Alberta 2.2 3.9Ontario 2.1 3.5NWTerritoires/Nunavut 2.1 4.3New Brunswick 2.0 3.6Saskatchewan 1.8 3.3

(percentage)

Provincial Distribution of Tourism GDP Shares (1996)

4.8

3.53.1

2.62.3 2.3 2.2 2.2 2.1 2.1 2 1.8

1

2

3

4

5

6

7

8

9

10

Canada (1998)2.3 %

Source: Statistics Canada (1996 PTSA and 2001NTI)

PTTSA Results:

SOURCES OF TOURISM DEMAND, PROPORTIONS, 1996

InternationalDemand

(percentage)Yukon 62.7 17.0 20.2British Colombia 39.1 38.3 22.6Ontario 38.1 48.1 13.8Canada, 1996 32.8 47.2 20.0Prince Edward Island 30.8 15.7 53.5Québec 28.8 52.9 18.3Alberta 28.0 47.6 24.4Nova Scotia 24.6 42.9 32.5New Brunswick 21.8 43.5 34.7NW Territoires/Nunavut 19.6 42.0 38.4Manitoba 16.3 49.1 34.6Newfoundland/Labrador 15.3 56.0 28.7Saskatchewan 9.4 62.6 28.0

Domestic iDemand

InterregionalDemand

Intraregional demandIntraregional demandee = the largest part of tourism $ = the largest part of tourism $Interregional demand = new aggregate indicatorInterregional demand = new aggregate indicator

Interregional Demand: 20%

International: 33%

Intraregional Demand: 47%

$54.6 Billion (2001)

% SOURCES OF TOURISM DEMAND, 1996

PTTSA Results:

REGIONAL TOURISM TRADE BALANCES, 1996Total balance

of tourism trade

(millions de dollars, Canadian)

British Colombia 202 430 -228Prince Édward Isle. 83 48 35Yukon 60 4 56Nova Scotia 50 56 -6Newfoundland/Labrador 25 -2 27NW Territoires/Nunavut 21 9 12New Brunswick -150 14 -164Alberta -406 -63 -344Saskatchewan -426 -128 -298Manitoba -484 -66 -418Québec -776 63 -839Ontario -2958 -366 -2592Canada, 1996 -4759 0 -4759

Interregional balance of

tourism trade

International balance of

tourism trade

FINDINGS

Importance of tourism in terms of GDP and employment

varies significantly from one province/territory to another

Provinces/territories ranking highest are those who depend more on international and interprovincial sources of tourism demand

Tourism plays a relatively more siginficant role in some of the smallest regional economies

Generally, the same regions also have a favourable

tourism balance of trade

PTTSA Findings:

PTSA Challenges:

Geographic vs commodity aggregation Detailed results vs confidentiality Reconciliation of data on supply with demand Questions and lack confidence in the quality of estimates for small regional samples and industries Comparability with previous provincial estimates from economic models Comparability with other existing provincial/regional data sources Financial participation of ALL provincial/regional partners Communications, communications, communications…! Politics, politics, politics, politics…!

CHALLENGES

PTSA: Future Vision

Provincial Tourism Indicators

Provincial & Local Impact Models

Provincial Human Resources Module

International regional comparisons

POSSIBLE FUTURE DEVELOPMENTS

CONCLUSIONS CONCLUSIONS

PTSA is technically feasible

Foundation for further developments

Potential to develop comparable cross- border accounts

Main challenges: data quality & consistency,

communications and politics-- meeting

information needs vs biggest number syndrome

PTSA: Conclusions:

THANK YOU FOR YOUR ATTENTION!

WEB: www.smmra.com

E-Mail: smeis@rogers.com