Tourist operators struggle with fewer visitors and inflation

“I’m personally concerned for our industry,” said Jusep Sim, founder of Chopsticks+Forks, which runs food tours in Toronto.

“I know if there’s another shutdown, we’re dead — so no more pandemic please,” he added. “The stress level is through the roof. Because, I mean, I’m in survival mode until the end of this year,” as are many other tourism-based businesses both in Toronto and around the province.

“I’m hoping for a good fall. And hopefully Taylor Swift helps a little — yes, I know. But I don’t think Taylor Swift will make up for the year’s slow growth,” he said, referring to the musical artist’s six planned shows in the city in November.

And with a drop in international travellers — especially from China amid strained relations with the federal government, but also from Europe and to some extent, America — it’s left the sector reeling once again.

Today, travellers from China are barely one-quarter of what they were just a few years ago. Visits by Americans are down 20 per cent and international visitors are down 30 per cent. 

Businesses are now looking to governments for a clear plan to help the sector get ahead.

Pre-pandemic, tourism in Ontario contributed $37 billion to the provincial economy. 

Tourism Minister Stan Cho, who recently took over the portfolio, told the Star “we have a huge opportunity here. I’m really proud of where I was born and raised and how amazing Ontario is.”

The pandemic, he added, “obviously hurt tourism in a big way, and was really rebounding in 2022 — it was a great year with $33 billion in economic activity” and 360,000 jobs across the province.

Now, the goal is not only to match pre-pandemic numbers but surpass them, and Cho said he’s talking to different stakeholders and starting to “put the pieces together on a broader plan” that will be released in the coming months and will include more infrastructure investments.

While Cho shares concerns about “variable geopolitical and economic situations around the world,” he said they are cyclical and that he expects things to bounce back as Ontario looks to travellers from countries, such as India, who are visiting Canada at twice the rate they were just six years ago.

The question will be “how can we market better to keep that trend going, as well as to look toward recovering some of our traditionally stronger markets — the U.K., China, as well as some of the day travel from the U.S.? We are confident we’ll go back the other way and we’ll have some record visits to Ontario in the coming years,” Cho said.

Laurie Marcil, executive director of Nature & Outdoor Tourism Ontario in the north, said hotel and campground businesses seem to have recovered post-pandemic, but lodges and resorts in more remote locations “are still limping along,” especially with the drop in American visitors.

“There are some oddities going on,” she added. “In the middle of June, which is peak fishing, all of a sudden people were seeing vacancies which doesn’t normally happen. That’s a weird one for this year and we haven’t quite figured out why that is, other than whenever there is a U.S. election looming, the American guests often take a step back, they are more hesitant about travelling, they are very focused on what’s happening in the U.S.”

Despite a strong domestic market, businesses are struggling with rising operating costs, and need to look at new markets or more services “but they just don’t have the financial capacity right now to do that. They’re so focused on paying back that (pandemic) debt,” Marcil said.

Marcil would like to see the province help businesses fund things like solar power, not only because it saves money but also because it would promote green energy sources, which travellers like. She’s also hoping for rooftop sprinklers to help with the threat of forest fires, which in past years has also affected business, and even more electric vehicle charging stations in the north.

“You know, we are the poor cousins up here when it comes to that kind of stuff,” Marcil added. “It’s really important to us as well” and will be brought up at the annual meeting of the Association of Municipalities of Ontario meeting later this month in Ottawa.

Many of the issues facing tourism operators are out of their control, and it’s time for governments to act, said Crystal Sheriff, owner of tour company Gray Line Toronto and an executive member of the Tourist Guide Association of Toronto.

Her business has not only been affected by inflation and the drop in international visitors to Ontario, but even by the wildfires in Jasper, Alta. 

“We usually have a lot of passengers that are coming by rail from Vancouver to Toronto. We are one of the stops on the Rocky Mountain rail, and the clients will then come and do a city tour and Niagara Falls tour with us,” she said. “A lot of people were impacted with the wildfires and tourism in the area. They are no longer coming to Toronto as their trip from Vancouver has been impacted by train.”

For Terrence Eta, founder and general manager of Toronto Bicycle Tours & Events, by 2022 his company was back to pre-pandemic levels, and in 2023, had surpassed it.

But “things have flattened so far this year against 2023,” he said, adding while there’s not been a noticeable drop in international visitors, group tour bookings have lagged. 

In talking to people, “I think Toronto’s just gotten too expensive,” he said. “Hotels can be hundreds of dollars a night — and the high hundreds” which limits how much they spend while in the city, he added.

Sheriff is calling on different levels of government to boost marketing efforts here and abroad to attract visitors, as well as to provide grants, loans and tax relief to those tourism companies.

Simpler visa and entry rules would also help, she said.

Andrew Siegwart, president and CEO of Tourism Industry Association of Ontario, agreed, saying visa processing has slowed, and it has led to the loss of at least one large international conference here “because the visa processing times were too long in Canada for the global delegates to get here. 

“We want to see all efforts to get that back to where it needs to be,” he said.

Many businesses are also struggling to repay the Canada Emergency Business Account (CEBA) loans at the same time they are dealing with fewer bookings, added Sim of Chopsticks & Forks.

Andrew Weir, president of Destination Toronto, said Toronto’s success is intertwined with other tourist locales around the province and “we’re certainly seeing recovery,” he added, “but the downside is it has not fully recovered yet.”

The domestic leisure market “has been very strong,” he said, and by 2023 was “all the way back to where it had been, and even more so.”

But in Toronto and across North America, convention bookings and sizes are not what they were, and given they are booked years in advance, this will be an ongoing issue, he added.

Companies are consolidating events, and aren’t sending as many people to meetings, “and it’s really a fundamental change in the business that has nothing to do with Toronto specifically,” he said.

He also noted the huge impact of the international market — where China was once the number one, “it’s barely recovered to about 20 per cent of that so far.”

“If the China market is going to be inaccessible to us for the next few years, we’re going to find new alternatives … so we’re conducting a more rigorous analysis right now,” he added.

Hotel occupancy in Toronto is up slightly so far over last year — about one and a half per cent, but that’s still six per cent lower than 2019.

Weir said the six Taylor Swift concerts come in November at a “critical time of year when there isn’t as much leisure travel … But what it really shows is just how impactful and important major events are, and it’s why as a city, we’ve got to identify more and more major events that we can attract or grow or create” year-round.

“I’d say we are on the road to recovery,” added Siegwart of the Tourism Industry Association of Ontario. “But the last kilometre is always the most challenging.”