Travel, tourism to support 9 crore new jobs by 2035: WTTC
News Summary
A World Travel & Tourism Council (WTTC) report forecasts that the global travel and tourism sector will support 91 million new jobs by 2035, accounting for one in every three new jobs created worldwide. In 2024, the sector's GDP contribution grew 8.5% to reach $10.9 trillion, surpassing 2019 levels by 6%, and created 20.7 million new jobs, bringing the global total to 357 million. However, the report also highlights a projected workforce shortfall of over 43 million people by 2035 if left unaddressed, with labor availability 16% below required levels. The largest absolute shortfalls are forecast in China (16.9 million), India (11 million), and the European Union (6.4 million). Europe remains a leader in international tourism, while the Middle East, particularly Saudi Arabia, is one of the fastest-growing regions. Italian Prime Minister Giorgia Meloni emphasized her government's investment in tourism infrastructure.
Background
The World Travel & Tourism Council (WTTC) is the global authority on the economic and social contribution of the travel and tourism sector, working with governments on industry issues. Its latest report, 'Future of the Travel and Tourism Workforce,' was released at the 25th WTTC Global Summit, based on extensive global research, including a large-scale survey of business leaders and in-depth interviews with tourism body members and other key stakeholders. Annually, WTTC produces reports on the economic and employment impact of travel and tourism for 184 countries/economies and 28 geographic or economic regions. These reports are vital tools for helping public and private sector bodies understand the significant value travel and tourism brings to the economy, and to ensure that policymaking and investment decisions support the sector. WTTC aims to maximize the inclusive and sustainable growth potential of the travel and tourism sector by partnering with governments, destinations, communities, and other stakeholders.
In-Depth AI Insights
What are the underlying implications of the projected 43 million workforce shortfall in travel and tourism by 2035? This significant labor gap points to escalating wage inflation and increased operational costs for travel and tourism businesses, potentially eroding profit margins and posing risks to service quality. Faced with insufficient labor supply, companies will either need to significantly increase compensation to attract and retain talent or accelerate technology adoption to reduce reliance on human labor. - Investors should scrutinize companies making strategic investments in automation, AI-driven customer service, and workforce training/reskilling platforms, as these will be better positioned to navigate labor market challenges. - The shortfall could prompt governments to re-evaluate immigration policies to attract international workers, introducing new social and political considerations. - The substantial projected shortfalls in China, India, and the EU by 2035 present significant investment opportunities in technology solutions and specialized training services within these regions. Beyond economic growth, what deeper strategic motives might underpin government investments in tourism as highlighted in the report? Government investments in tourism infrastructure, as emphasized by Italian Prime Minister Meloni, may extend beyond mere economic returns to include significant geopolitical and soft power considerations. Especially during President Trump's term in 2025, with increased global trade and inter-state relationship uncertainties, tourism can serve as an effective diplomatic tool. - Investing in tourism helps enhance a nation's image and cultural influence, attracts foreign direct investment, and fosters cross-cultural exchange, thereby building stronger bilateral ties in a potentially tense international environment. - For rapidly growing regions like the Middle East (e.g., Saudi Arabia), large-scale tourism investments are central to economic diversification strategies, aiming to reduce reliance on oil revenues and position themselves as global business and leisure hubs. - Furthermore, robust tourism growth creates substantial employment, which is a critical stabilizing factor for any government, helping to alleviate domestic social pressures and bolster political legitimacy. How should investors re-evaluate the risk-reward profile of the global travel and tourism sector in light of the WTTC report? The report paints a picture of an industry with significant opportunities but also structural challenges. While demand is strong and growth potential is substantial, the severe labor shortage presents a structural risk that could constrain growth and increase operational costs. - Investors should shift focus from solely revenue growth in the sector to evaluating companies' ability to manage labor costs and effectively deploy capital expenditure, particularly in technology and efficiency improvements. - Companies with strong brand recognition, capacity to attract and retain talent, and dominance in high-margin niches (e.g., luxury leisure, bespoke experiences) may be more resilient to rising labor costs. - Given the regional disparities in labor shortages, investors might adjust their geographic allocation strategies for travel-related assets based on labor market dynamics in different countries and regions (e.g., challenges in China, India, and the EU versus expansion in the Middle East).