South Korea

News Articles | World Travel & Tourism Council (WTTC)

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COVID-19 triggers sharp 45.5% drop in sector’s contribution to GDP
84,000 jobs lost, while many more remain protected by job retention schemes
However, the return of international travel this year could lead to a sharp increase in GDP contribution and the return of jobs
WTTC recognizes governments for effectively managing crises by implementing processes, policies and protocols

London, England: The World Travel & Tourism Council’s annual Economic Impact Report (EIR) today revealed the dramatic impact of COVID-19 on South Korea’s tourism industry, costing the country’s economy $33.3 billion.

The annual EIR of the World Travel & Tourism Council (WTTC), which represents the private sector in global travel and tourism, shows that the industry’s contribution to GDP has fallen by a staggering 45.5%.

Tourism’s impact on the country’s GDP fell from $73.2 billion (4.4%) in 2019 to $39.9 billion (2.4%) in 2020 just 12 months later.

A year of devastating travel restrictions that brought most international travel to a standstill led to the loss of 84,000 tourism jobs across the country.

However, this figure, while devastating for those affected, is far lower than many other countries globally and in the region.

The WTTC believes the real situation could have been worse without the government’s job retention scheme, road map for universal employment insurance and stimulus payments for emergency relief, all of which provide lifelines to thousands of businesses and workers.

These job losses are being felt across the country’s tourism ecosystem, with SMEs disproportionately affected, accounting for eight out of ten of all global businesses in the sector.

Furthermore, as one of the most diverse sectors in the world, its impact on women, youth and minorities is enormous.

Employment in South Korea’s tourism industry fell 6.2% to 1.3 million in 2020 from nearly 1.4 million in 2019.
However, again due to government job retention schemes, this figure was significantly lower than the global average decline of 18.5%.

The report also showed that domestic tourist spending fell by 34%, while international tourist spending fared worse with a 68% drop due to stricter travel restrictions, only slightly better than the global average drop of almost 70%.

WTTC Senior Vice President Virginia Messina said: “The loss of 84,000 tourism jobs in South Korea has had dire socio-economic impacts and left large numbers of people worried about their future.

“However, we must commend the incredible efforts of President Moon Jae-in. WTTC and its members would also like to thank Minister of Culture, Sports and Tourism Hwang Hee for his commitment to the private sector to save the tourism industry.

“The government’s response to COVID-19 has been excellent, with robust processes in place, strong policies and protocols in place to manage the crisis.

“With its experience with the Middle East Respiratory Syndrome (MERS), South Korea was able to flatten the curve very quickly without closing businesses, issuing stay-at-home orders, or implementing many of the stricter measures other countries have adopted until the end of 2020.

“Additionally, it has clear guidelines for the public, comprehensive testing and contact tracing, and supports easier compliance for those in quarantine. Relaxing quarantine rules for vaccinated travelers is certainly a step in the right direction step out.

“The WTTC believes the 84,000 jobs lost in South Korea could be recovered later this year if travel restrictions are eased ahead of the busy holiday season, along with a clear roadmap for increased mobility and a thorough testing of departure plans.”

WTTC research suggests that if mobility and international travel resume by June, the industry’s contribution to global GDP could surge by a massive 48.5% YoY in 2021.

The global travel body believes the key to unlocking safe international travel can be achieved through a clear, science-based framework that includes rapid pre-departure testing, enhanced health and hygiene protocols, including mandatory wearing of masks, and the rollout of vaccines.
These measures will be the basis for restoring the millions of jobs lost to the pandemic.

It will also reduce the dire social impact of these losses on communities dependent on travel and tourism, as well as ordinary people isolated by COVID-19 restrictions.

Download the press release.

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