Can you think of an industry more impacted by the pandemic than tourism? International travel came to a virtual halt, depriving the industry of revenues.

Given the severity of the disruptions, it’s hard to imagine that tourism spending could ever recover. But that’s exactly what has happened.

Recently released data show that foreign* visitor spending in Alberta hit a record high in the first half of 2024 at $1.2 billion. That’s 6.6% higher than the same time last year, with spending up across all categories.

It was overseas visitors that contributed the most in the first half, spending $621 million—up 13.7% from the first half of 2023. Spending by Americans accounted for $592 million, on par with the same time last year.

Taking a longer view, foreign visitor spending in Alberta was 36% higher than the first half of 2019—prior to the pandemic. That’s the largest increase among the provinces and far outpacing the national 9% increase.**

Foreign tourist spending provides a significant boost to the province, as it is ‘incremental’ or new money coming in. But it is just one component of tourism spending. The other larger categories are spending by other Canadians and Albertans themselves. These categories are available on an annual basis and were recently discussed in the November 22 edition of the Seven.

Tourism is part of the growth-broadening story we’ve been talking about. Oil production and home construction are driving growth this year, but a wide range of sectors are also chipping in, from food manufacturing, to technology, to aviation, and of course tourism. A weak loonie, relative to the greenback, is also making travel more affordable for U.S. visitors and will continue to encourage visits to the province.

The trend in spending is positive, but there are still some challenges for tourism operators. One is labour shortages, with accommodation and food services having the highest job vacancy rate among major sectors as of the second quarter. Another is rising costs, including the spike in food costs since the pandemic. More recently, wildfires have taken a staggering toll on Jasper, destroying about a third of the town during peak travel season. National Park attendance in Alberta was down more than 35% in August compared to the same month last year, with Jasper Park falling to zero that month. While visitors are returning, we’ll likely see the impact in the third quarter spending data.

It’s also worth noting that the COVID bounce back in foreign travel spending is driven by higher spending per visit, not more visits overall. Indeed, foreign visits in the first half of this year trailed 2019 first half levels by nearly 3%. While U.S. travel has fully recovered, overseas visits have not. Yet spending per overseas visit has jumped, providing an offset. This is important, as a full recovery in non-U.S. travel provides a runway for even more growth in the sector.

Bottom line: The tourism sector has bounced back from COVID in a meaningful way, and is an important part of the growth and diversification story in Alberta.

*Non-resident visitors to Canada.

**Statistics Canada publishes data between Q1 2018 and Q2 2024, but notes methodology changes in 2020 that may impact comparisons over time. 

Answer to the previous trivia question: The cancelled Keystone XL project would have created a oil pipeline from Hardisty, Alberta, to Steele City, Nebraska with a capacity of 860,000 barrels per day.

Today’s trivia question: Who was the first person to reach the South Pole?