Japan tourism nears pre-pandemic levels amid long-term curbs

Japan’s travel and tourism industry is expected to contribute USD 285.5 billion (JPY 37.6 trillion) to GDP this year, according to the latest findings from the World Travel and Tourism Council’s (WTTC) 2023 Economic Impact Study (EIR).

According to WTTC forecasts, Japan’s tourism industry is only 6.8% below its pre-pandemic high of US$306.5 billion (40.3 trillion yen) in 2019. Over time, the industry’s contribution to the overall economy is expected to reach 6.8 percent, according to VisaGuide.World.

Although the impact of the epidemic will continue until 2023, WTTC expects the industry to create about 470,000 jobs this year, bringing the total workforce to nearly 5.6 million. This suggests that approximately one in 12 workers in Japan is directly or indirectly employed in the tourism industry.

While Japan’s tourism industry is still struggling to regain pre-pandemic employment levels, it is expected to remain 5.2% below 2019 levels, implying a shortfall of about 300,000 jobs by the end of the year.

On a positive note, international tourist spending in Japan is expected to surge 553.4% ​​this year to $16.8 billion (2.2 trillion yen). But it’s worth noting that this figure is still 57.6% below the peak set in 2019.

Japan’s tourism industry contributed 50.5% to GDP last year

Japan’s tourism industry grew significantly last year, contributing 50.5 percent to more than $257 billion (33.9 trillion yen) in GDP. This massive increase accounted for 6.2% of the country’s economy.

The industry has also grown over the same period from the previous year, with national employment reaching nearly 5.1 million, meaning more than 1 in every 13 jobs in Japan is in the travel and tourism industry.

On the other hand, the long-term impact of travel restrictions leads to a decline in spending by international tourists in Japan in 2022. The drop was more than 31%, and it was 93.5% below 2019 levels.

Meanwhile, spending by domestic tourists in Japan grew strongly, rising 61.6%. This is a respectable increase, almost reaching 2019 levels, and only a slight difference of 0.2% from the pre-pandemic figure.

“International travel is critical to achieving the long-awaited recovery. We must nurture and support the industry, finding innovative ways to attract tourists and ensure their comfort. By doing so, we can boost the economy and support livelihoods and local Community.” Julia Simpson, President and CEO of WTTC pointed out this.

As Hiroyuki Takahashi, Chairman of the Board of JTB Corp, explained, there is a huge and growing global demand to visit Japan. He also said that to meet this demand, JTB Corp is working with the public and private sectors to develop new tourist attractions and expand capacity in rural areas.

“Despite the challenges, passenger throughput at Haneda Airport’s international terminal is expected to exceed 18 million by the end of the year. With increased flight schedules and capacity, and projected growth in inbound demand, we expect passenger numbers to surpass 25 million passengers.” JAT Chairman and CEO Isao Takashiro also added.

The WTTC report further shows that in 2022, the main source markets of Japanese international tourists are as follows:

  • South Korea (24%)
  • Mainland China (10 percent)
  • Taiwan, China (10 percent)
  • United States (8 percent)
  • Hong Kong, China (7%)

Japan tourism expected to increase GDP contribution by 2033

The global tourism body predicts that Japan’s tourism contribution to GDP is expected to expand to US$353.4 billion (46.5 trillion yen) by 2033. This projected increase means that the Japanese economy will expand by almost 8%. Furthermore, the industry is expected to employ approximately 6.7 million people nationwide, suggesting that one in ten Japanese residents will work in the travel and tourism industry.

In 2022, tourism in the Asia-Pacific region will contribute US$1.6 trillion to the regional economy. However, this figure is still 50% below the peak in 2019, indicating the continuing impact of the epidemic on the industry.

According to WTTC forecasts, tourism’s contribution to the region’s GDP is expected to exceed $2.6 trillion by 2023, down 16% from its pre-pandemic high in 2019.

In terms of employment, more than 155 million people will be employed in this industry in the region in 2022, an increase of 8.7 million over the previous year. However, that figure is still 15% below pre-pandemic employment levels. WTTC predicts that jobs lost during the pandemic will be fully recovered by late 2024 or early 2025.

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