Tourism businesses in Australia: June 2015 to 2020

Our Tourism Businesses report provides statistics on Australia’s 300,000 plus tourism businesses. Find out about changes in business size, numbers and contribution from June 2015 to June 2020.

COVID-19 continues to have a huge impact on Australia’s tourism industry. This report includes data up to and including June 2020, capturing:

  • the 2019-20 summer bushfires
  • disruptive effects of domestic travel restrictions
  • the dramatic decline in international visitors from March 2020.

Summary

There were 317,653 tourism businesses in Australia at June 2020. This made up around 13% of Australia’s 2.4 million businesses.

Increasing tourism businesses

The number of tourism businesses in Australia grew 15% since June 2015. Much of this was due to 142% growth in taxi transport and vehicle hire businesses. Without this particular increase, there would have only been 7% growth in tourism businesses since 2015.

Tourism businesses also increased by 1.2% during 2019-20. This was despite the impacts of COVID-19 and the 2019-20 summer bushfires. However, the rate of growth for 2019-20 was the slowest since 2014-15.

Fewer employees and lower turnovers

Tourism businesses at June 2020 had fewer employees on average and lower turnovers compared to a year earlier. This was mainly due to:

  • a sharp increase in the number of businesses without employees, and
  • a large decrease in businesses with 1-4 employees.

This change in composition is partly due to existing businesses shedding workers, and the entry of new businesses. 

About this report

The Tourism Businesses in Australia report describes the health of the tourism industry, and its response to changing business conditions and consumer behaviours. In this report, you will see changes:

  • in tourism business numbers
  • in tourism’s economic contribution
  • by business size
  • by state and territory
  • by business turnover.

You can also see changes within selected sectors of the industry.

As with previous reports, data are presented over a 5-year timeframe. However, the impacts of COVID-19 on Australia’s tourism industry were rapid and dramatic. The impacts are also expected to be long lasting. As a result, there is further analysis in this report about changes that occurred in 2019-20.

Business categories

Tourism businesses are categorised by employment size to make it easier to understand growth patterns. These are:

  • non employing – sole trader with no employees
  • micro – 1 to 4 employees
  • small – 5 to 19 employees
  • medium – 20 to 199 employees
  • large – 200 and over employees.

Challenges of bushfires and COVID-19

2020 was a devastating year for Australian tourism businesses. The year started with some of Australia’s worst ever bushfires across large parts of New South Wales, Victoria and South Australia. These resulted in:

  • mass travel cancellations during what would have been a period of peak demand
  • damage to Australia’s international tourism reputation as a pristine destination
  • emotional and financial distress among many regional operators.

When recovery was within reach, the COVID-19 pandemic began. This saw:

  • government closing international and interstate borders
  • airlines grounding passenger fleets
  • businesses shutting down and hotels going into hibernation.

Demand slumped as global travellers cancelled plans and travel restrictions stifled domestic tourism.

Impacts on the sector during 2019-20

No sector of the economy escaped the impacts of the pandemic. However, tourism was one of the industries most affected:

  • Tourism Gross Domestic Product (GDP) fell 17.6%. This compares with 1.7% growth for the economy as a whole.
  • Tourism employment fell 6.6%. Australia’s workforce grew 0.1% over the same period.

Positive signs for recovery

Many challenges remain, but there are some positive signs:

  • Domestic tourism is returning as:
    • health concerns diminish
    • borders and movement restrictions ease
    • consumer confidence returns.
  • Domestic demand for tourism will continue to increase. This will be due to improving economic conditions and continuing suspension of most overseas travel. This is already reflected in the latest tourism employment figures, with 5.1% growth during the December quarter of 2020. This is larger than the usual seasonal pick-up.

The return of international tourism will be much slower. However, Australia will be able to market itself as a relatively safe travel destination when travel does return to scale.

Number of tourism businesses

Australia had 317,653 tourism businesses at June 2020. This is 1.2% more businesses than at June 2019 and 15% more than at June 2015. This means the number of tourism businesses continued to grow, despite the very difficult environment. However, it was the slowest rate of growth since 2014-15

Possible reasons for this growth are:

  • the introduction of JobKeeper and other economy-wide and sector-specific support from government
  • the extension of creditor laws. Businesses facing financial difficulties could apply for six months of relief from creditors. Previously they could only apply for three weeks of relief
  • a high degree of business entries and exits. In 2019-20:
    • 52,700 new businesses entered the tourism industry
    • 49,100 businesses left the tourism industry (an exit rate of 16%).

On average, these businesses tend to be far smaller than existing businesses. This means the overall impact on Australia’s tourism sector is low, despite the large numbers of businesses involved.

Change in business numbers by industry

The composition of the Australian tourism industry has changed significantly since 2015. For example, there are:

  • 142% more taxi transport and vehicle hire businesses. This is due to a strong increase in ride-share and car-share services. Without this particular increase, there would have only been 7% growth in tourism businesses since 2015.
  • fewer accommodation businesses, due to consolidation within the industry and the growing impact of private providers
  • more cafes, restaurants and take-away businesses, due to population growth and increased use of online food delivery services
  • more travel agency and tour operator services. Many of these are mobile travel agents operating as very small businesses, who can give more personalised travel advice.
Change in business numbers by industry, June 2015 compared to June 2020
Tourism related industries Number of businesses (June 2015) Number of businesses (June 2020) Growth
(%)
Accommodation 13,045 12,802 -1.9%
Cafes, restaurants and takeaways – includes clubs, pubs, taverns and bars 74,586 83,881 12%
Taxi transport and Other road transport 16,392 39,604 142%
Air and water transport 5,123 5,276 3.0%
Motor vehicle hiring including Rail transport 1,717 2,246 31%
Travel agency and tour operator services 5,475 8,472 55%
Arts and recreation 26,189 31,172 19%
Retail trade 132,936 134,552 1.2%
Total 275,463 318,005 15.4%

Note: totals in different tables varies from actual estimates given in figure 1 (317,653). This is due to ABS confidentialising the data.

Drivers of growth

Drivers of growth in tourism businesses between June 2019 and June 2020 were:

  • 423 more travel agency and tour operator services, with 84% of new entrants having no employees
  • 698 more cafes, restaurants and take-away businesses. This was an increase of 0.9%
  • 664 more businesses providing creative services. This was up 4.2%.  This category includes artists, musicians and performers.

Business size

Tourism businesses are mostly small operations. At June 2020:

  • almost half (49.8%) of tourism businesses had no employees
  • 28% had fewer than 5 employees.

The concentration of smaller businesses with 0 to 5 employees is greatest in:

  • taxi transport (99%)
  • cultural services (96%)
  • motor vehicle hire (91%).

Changing business sizes

Businesses with over 200 employees grew 23% between June 2015 and 2020. This is due to both expansion and consolidation.

Micro, small and medium businesses grew only 1.1% over the same period. This slower rate of growth reflects a continuing shift away from smaller employing businesses to larger businesses.

The number of non-employing businesses increased 35% from 117,500 to 158,200. Over half of this growth (58%) came from taxi transport alone. This was an increase of more than 23,000 taxi transport businesses in June 2015.

There was a loss of more than 1,600 micro tourism businesses between June 2019 and June 2020. Over the same period the number of non-employing tourism businesses grew by more than 5,100.

Change in business numbers by employment size
Non Employing 1-4 Employees (Micro) 5-19 Employees (Small) 20-199 Employees (Medium) 200+ Employees (Large) Total
Tourism businesses 2019 153,090 91,012 54,181 14,857 876 314,016
Tourism businesses 2020 158,201 89,388 54,345 14,823 896 317,653
Change (number) 5,111 -1,624 164 -34 20 3,637
Change (%) 3% -2% 0% 0% 2% 1%

This shift in composition means that:

  • tourism businesses in 2020 are smaller on average than tourism businesses in 2019
  • there is an overall decline in the tourism workforce.

This decline in employment is consistent with the results of the National Tourism Satellite Account 2019–20. This reported a 6.6% fall in tourism workers between 2018-19 and 2019-20.

Turnover of tourism businesses

Turnover for most tourism businesses is low. At June 2020:

  • over half (51%) had annual revenues of less than $200,000 per annum
  • 11% had revenues greater than $2 million per annum
  • 46% of businesses in regional Australia had revenues of less than $200,000 per annum. This was compared to 54% of those in capital cities and the Gold Coast.

Tourism business growth across Australia

Growth by state and territory

At June 2020, most tourism businesses (81%) were located in:

  • New South Wales (NSW)
  • Victoria (Vic)
  • Queensland.

This is consistent with the State Tourism Satellite Account (STSA) data. The STSA shows these 3 states collectively accounted for 77% of tourism GDP and national visitor consumption in 2019-20.

Business numbers grew most quickly between June 2015 and June 2019 in these states and territories:

  • Vic (average annual growth of 4.3%)
  • Australian Capital Territory (ACT) (average annual growth of 4.1%)
  • NSW (average annual growth of 3.5%).

The slower growing states were:

  • South Australia (SA) (average annual growth of 1.2%)
  • Tasmania (Tas) (average annual growth of 2.0%).

Patterns of growth have changed between June 2019 and June 2020. States and territories showing stronger growth in business numbers were:

  • Tas (up 5.0%)
  • Vic (up 2.4%)
  • Qld (up 1.5%)
  • SA (up 1.3%)
  • Northern Territory (up 1.2%).

Tourism business numbers declined in the ACT (down 2.1%) and business numbers remained unchanged in Western Australia.

Growth in Australia’s regions

The number of tourism businesses in regional Australia increased by an average of 0.7% annually between June 2015 and June 2019. This was well below the 4.6% growth rate for capital cities and the Gold Coast. As a result, the share of tourism business in regional Australia has declined from 33.8% to 30.4%.

More recent data shows that between June 2019 and June 2020, regional Australia experienced a:

  • 0.4% growth in tourism businesses compared with 1.7% in the capital cities and Gold Coast
  • 2.4% increase in large tourism businesses
  • 1.5% increase in medium businesses
  • 0.4% decline in small businesses
  • 2.3% decline in micro businesses
  • 2.6% increase in non-employing tourism businesses
  • further decline in share, now accounting for 30.2% of tourism businesses.
Regional growth in tourism businesses, June 2019 to June 2020
Number of businesses at June 2020 Growth since June 2019
Regional Australia Capital cities and Gold Coast Regional Australia Capital cities and Gold Coast
Non employing 40,872 117,352 2.6% 3.9%
Micro 29,108 60,249 -2.3% -1.4%
Small 20,234 34,210 -0.4% 1.0%
Medium 5,097 9,672 1.5% -0.7%
Large 511 418 2.4% -4.1%
Total 95,822 221,901 0.4% 1.7%

Industry composition

There are clear differences between the types of tourism businesses operating in the regions compared with the capital cities and Gold Coast.

In regional Australia there is an over-representation (compared to the national average) of:

  • accommodation
  • pubs and clubs
  • air and water transport providers.

In the capital cities and Gold Coast there are more:

  • taxi operators
  • travel agencies
  • vehicle hire businesses
  • cultural services businesses
  • cafes, restaurants and take-away businesses.

Data tables

Find out more about tourism businesses in our data tables.

Summary table

A snapshot of the changes in the number of tourism businesses over time.

https://www.tra.gov.au/ArticleDocuments/185/TBIA 2020 Summary table.xlsx.aspx (146KB)

Geographic breakdown

Counts of tourism businesses across Australia’s tourism regions.

https://www.tra.gov.au/ArticleDocuments/185/TBIA 2020 Geographic breakdown.xlsx.aspx (692KB)

Employment size data

State and territory employment breakdown for different tourism industries.

https://www.tra.gov.au/ArticleDocuments/185/TBIA 2020 Employment size data.xlsx.aspx (248KB)

Organisation/employment data

Changes in company structures over time.

https://www.tra.gov.au/ArticleDocuments/185/TBIA 2020 Organisation and employment data.xlsx.aspx (568KB)

Contact us

Email tourism.research@tra.gov.au