FACTBase Bulletin 55 - Sizing Tourism in Western Australia

Tourism has been identified as a key international growth sector, and in Australia and Western Australia, it is anticipated that tourism growth will have the capacity to create new jobs and assist in driving economic expansion in coming decades.

This Bulletin has been prepared as part of the Bigger and Better Beyond the Boom project. It aims to ‘size’ and spatially examine the tourism sector in Western Australia and the Perth and Peel region to quantify the contribution of tourism to the state and regional economy; to compare the contribution of tourism in WA to other Australian states and territories and to identify opportunities for economic growth.

Key Findings

• Tourism is a growth industry in WA and Australia. The total contribution of tourism to the state economy has increased over the past decade with visitor growth trends in WA generally consistent with growth trends in Australia.
• Domestic tourism contributed 76% of direct state tourism Gross Value Added (GVA) in WA in 2015-16, with 63% of direct tourism GVA contributed by intrastate tourism – the highest share of any state or territory in Australia.
• While five-year domestic growth trends have been positive, intrastate and interstate visitor numbers declined in the Year Ending (YE) March 2016-17. This included significant reductions in intrastate and interstate visitor numbers in the March 2017 quarter. If this downward trend continues, it could substantially impact on the contribution of tourism to the WA economy moving forward.
• WA underperforms in the interstate sector, with the state attracting 4.6% of total national interstate visitors in YE March 2016-17. WA appears to be particularly underperforming in the attraction of interstate leisure visitors when compared to other states and territories.
• International visitor numbers have exhibited steady growth in WA over the past decade and provide a significant opportunity for future expansion. However, growth in visitor numbers has not been matched by commensurate growth in international visitor nights or expenditure. This appears to reflect a national trend towards shorter trip lengths, as well as declining visitor numbers and expenditure in the longer stay visitor category of employment.
• International and interstate visitors stay in WA 30 and 9.3 days respectively on average. This is longer than the average stay of visitors to other states. While this provides economic advantages it also reflects a key disadvantage, particularly in attracting domestic interstate visitors who, research indicates, prefer short trips when travelling domestically.
• Purpose of visit has a significant impact on visitor nights and visitor spend. For example, holiday visitors exhibit shorter stays and higher average expenditure per night while education and employment visitors stay for longer periods but spend less on a per night basis. This highlights the importance of attracting a diversity of visitors to the state.
• The Experience Perth region is the primary tourism destination for visitors to WA in all categories, particularly international visitors, 95% of whom stay in the Experience Perth region during their stay in WA. Australia’s South West is the second most popular visitor region in WA.
• In YE March 2016-17, WA’s largest inbound tourist markets were the UK, Malaysia and Singapore and the three largest markets for visitor spend were the UK, China and Singapore (TWA, 2017a). WA’s fastest growing inbound tourism markets by visitor numbers in 2016-17 were Malaysia (32%), Singapore (27%), UK (22%) and USA (12%) and the fastest growing by visitor spend were Singapore, Malaysia, UK and Indonesia (TWA, 2017a).
• Proportionally, WA has been found to attract less than its population based share of visitors and visitor spend from key markets including China and New Zealand, with China being most notable. WA attracts 4.6% of Chinese visitors to Australia and 6.7% of total spending by Chinese visitors in Australia (TWA, 2017a). However, WA attracts more than its population based share of visitors and visitor spend from key markets including United Kingdom, Malaysia, Singapore and Germany.
• International visitor origin impacts on the tourism regions people choose to visit. Visitors from Malaysia, Singapore and China are most likely to visit Experience Perth and Australia’s South West with only a small proportion venturing to Australia’s Coral Coast; North West or Golden Outback. By contrast visitors from Germany, the USA and NZ are more likely to visit a range of regional destinations (TWA, 2017b). This highlights the importance of attracting visitors from diverse markets.
• The distance to WA from major eastern states attractions and capitals is a disadvantage for WA, however WA’s beaches, wildlife, unspoilt and sparsely populated natural wilderness and island experiences provide opportunities for tourism in Perth and other regions in the state. Indigenous tourism experiences have also been identified as an opportunity for WA.
• Accessibility is essential to enable visitation and there is potential to increase access to WA by increasing the number and frequency of direct flights to the state as well as developing new regional airports with the capacity to accommodate flights from interstate capitals.
• There are opportunities for WA to identify and selectively promote the unique or distinctive characteristics of travel destinations in the state to the state’s key domestic interstate and international tourism markets.