According to Travel Agents & Overseas Tour Operators 2014, a new Market Update from business intelligence provider Key Note, the total turnover of travel agents and tour operators in the UK grew by 2.3% last year.
The UK market for travel and tourism was hit particularly hard by the 2008/09 recession and subsequent economic downturn, with economic realities severely dampening consumer confidence, thereby resulting in lower spending on travel and tourism. However, the market for travel and tourism has more recently shown signs of improvement, steadily developing and advancing upon pre-recession levels, encouraged by reassuring economic data concerning gross domestic product (GDP) growth, inflation, unemployment and household expenditure.
Of particular concern to the travel and tourism market, and therefore relevant to travel agents and overseas tour operators, remains the controversial issue of Air Passenger Duty (APD), which prevails to be considered an appreciable burden to the potential of the market. Although the tax was simplified in the March 2014 Budget, and the tax on long-haul travel is set to be reduced, the high taxes, particularly when compared against competitor countries, can ultimately diminish the attractiveness of the UK as a holiday destination, and in addition, can serve to discourage UK residents from travelling abroad.
Over the short term, both domestic and outbound tourism are forecast to witness moderate growth, which in turn will be positive for enterprises engaged in travel and overseas tour operating. Domestic tourism, in particular, will be bolstered by what experts forecast will be an exceptionally warm summer this yea, and travel and tourism in general will prosper as consumer confidence consolidates, therefore allowing both the volume and value of the industry to expand and return to normalcy, which in turn will offer opportunities and prospects for growth for travel agents and overseas tour operators.