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The Economic Impact of Tourism in Buncombe County, North Carolina
2017 Analysis
September 2018
2
Introduction and definitions
⚫ This study measures the economic
impact of tourism in Buncombe
County, North Carolina.
⚫ Visitors included those who stayed in
overnight accommodations or
travelers who came from a distance
greater than 50 miles and deviated
from their normal routine.
⚫ The impact of tourism includes direct
spending, the indirect (supply-chain)
effects, and induced (income) effects.
⚫ Impacts were measured in terms of
employment, income, business sales,
and tax revenues.
Headline Results
4
Headline results
⚫ Tourism is an integral part of the
Asheville regional economy, and the
industry continues to make
significant contributions to economic
growth, generating business sales,
employment, and tax revenues.
⚫ Visitors to Asheville spent $2.0
billion in 2017, which generated $3.1
billion in total business sales,
including indirect and induced
impacts.
⚫ Tourism in Asheville generated $368
million in tax revenues in 2017,
including $199 million in state and
local revenues.
5
Headline results
⚫ Including direct, indirect, and
induced impacts, 27,241 jobs
were sustained by visitors to
Asheville in 2017 with total
income of $840 million.
⚫ Approximately 15% (1-in-7) of all
jobs in Buncombe County were
sustained by tourism.
⚫ An estimated 26% of tourism-
supported jobs were in the food
and beverage industry, 18% in
lodging, 13% were in retail, 12%
in recreation, and 31% were in
other categories.
Key Trends in 2017
7
Key themes for 2017
⚫ Visitor volume and spending
expanded in 2017.
⚫ An estimated 11.1 million
visitors spent a total of $2.0
billion in 2017, increases of
2.6% and 4.4%, respectively,
from 2016.
⚫ Domestic overnight visitors
accounted for most spending.
Domestic Overnight Visitor Volume and Spending
(Millions)
2013 2014 2015 2016 2017
Visitors, millions 3.200 3.331 3.496 3.722 3.830
% change 5.2 4.1 5.0 6.4 2.9
Spending, $millions 1,015.9 1,064 1,129 1,223 1,273
% change 7.1 4.8 6.1 8.3 4.1
1.5
1.6
1.7
1.8
1.9
2.0
2.1
8.5
9.0
9.5
10.0
10.5
11.0
11.5
12 13 14 15 16 17
Total visitor volume, mil (L)
Total visitor spending, $bils (R)
Visitor Volume and Spending
Sources: Longwoods International, Tourism Economics
Buncombe County
8
Key themes for 2017
⚫ Asheville’s hotel room demand
has outpaced supply in recent
years.
⚫ In 2017 however, room supply
expanded 4.7% and room
demand grew 3.7%.
⚫ With supply growing faster than
demand, the occupancy rate
ticked down to 73.0% from
73.7% in 2016.
⚫ Demand and rising prices are
driving balanced room revenue
growth. Average rates were up
2.5% in 2017, and total room
revenues rose 6.3%.
90
100
110
120
130
140
150
10 11 12 13 14 15 16 17
Hotel room supplyHotel room demand
Hotel Sector: Lodging Demand Is Outpacing
Source: Smith Travel Research
Supply and demand of room-nights indexed to
Jan 2010=100
-15
-10
-5
0
5
10
15
20
08 09 10 11 12 13 14 15 16 17
ADR
Demand
Revenues
Demand and Prices Drive Hotel RevenuesContribution to % change year ago
Source: Smith Travel Research
9
Key themes for 2017
⚫ The use of non-hotel lodging,
such as AirBnB and Vacation
Rental By Owner, continues to
expand.
⚫ Short-term rentals account for
an increasing share of total
reported taxable lodging sales
in Buncombe County.
⚫ In 2017, spending on short-
term rentals reached an
estimated $53.8 million and
accounted for nearly 15% of
the total.
$2.1m (0.9%)
$10.7m (3.7%)
$28.3m (8.4%)
$53.8m(14.9%)
0
10
20
30
40
50
60
2014 2015 2016 2017
Expansion of Short-term Rentals
Sources: Asheville CVB, AirDNA, Tourism EconomicsNote: Some growth is attributable to improved reporting of short-term rental sales.
Estimated lodging sales in $mils, share of total in parentheses
10
Key themes for 2017
⚫ Buncombe County employment
growth is outpacing that of
North Carolina and the U.S.
overall.
⚫ Within the County, tourism
employment is expanding
faster than overall job growth.
Industry employment is 21.4%
higher than in 2009, versus
19.9% for the County overall.
⚫ In 2017, the unemployment
rate in the county was 3.5%.
Without tourism it would have
been 14.9%.
90
95
100
105
110
115
120
125
05 06 07 08 09 10 11 12 13 14 15 16 17
USNorth CarolinaBuncombe CountyBuncombe Tourism
Tourism Jobs Outpace in Buncombe County
Sources: BEA, BLS, Tourism Economics
Employment indexes, 2009=100
Visitors and Spending
12
Visitor details in 2017
⚫ Asheville hosted a total of
11.1 million visitors in 2017,
including 3.8 million domestic
overnight.
⚫ Most visitors were day visitors
(65.4%) and most came for
leisure (93.3%). Day visitors
tend to come to visit friends
and family, tour the city,
outdoors activities, and
shopping.
⚫ Average daily spending for
overnight visitors was $121
per person, compared with
$86 for day visitors.
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
Day/Overnight Domestic/Int'l Liesure/Business
Visitor Characteristics2017
Sources: Longwoods Int'l, Tourism EconomicsNote: Overnight/Day and Bus./Leisure segments are domestic only
Overnight(34.6%)
Day(65.4%)
Int'l(0.8%)
Domestic(99.2%)
Bus.(6.7%)
Leis. (93.3%)
13
Composition of tourism spending
⚫ Food and beverage accounted for most visitor spending with $544
million, followed by lodging at $453 million, retail at $437 million, and
$275 million in recreation spending.
⚫ About half of visitor spending was on food and beverage and retail
combined, and lodging accounted for 23.4% of visitor spending.
543.9
453.1 437.4
274.9230.2
0
100
200
300
400
500
600
Food Lodging Retail Rec Trans
2016
2017
Visitor Spending by Category$ million
Source: Tourism Economics
Food 28.0%
Retail 22.6%
Lodging 23.4%
Rec 14.2%
Trans 11.9%
Visitor Spending Profile for 2017Avg per person per
day = $102
Source: Tourism Economics
14
Fuel prices are creeping up
⚫ After more than three years of
decline, fuel prices are on the
rise.
⚫ Despite recent increases,
prices are still relatively low
and encourage trips and
visitor spending that otherwise
might not occur.
⚫ Oxford Economics forecasts
oil prices to remain under $70
per barrel on average through
2020, implying gasoline prices
in Asheville under $3.25 per
gallon for an extended period.
1.0
1.5
2.0
2.5
3.0
3.5
4.0
4.5
06 07 08 09 10 11 12 13 14 15 16 17 18
South Atlantic, PADD 1C
12-mo MA
Fuel Prices Are Low But Rising
Source: Energy Information Administration
South Atlantic Region average gasoline price, dollars per gallon
15
Visitor spending trends
⚫ Visitor spending increased 4.4% in 2017, led by lodging and food and
beverage. Lodging spending grew 6.3% as both prices and room-
night demand increased.
⚫ Visitor spending on food and beverage and recreation increased 4.7%
and 3.5%, respectively, rates of growth slightly lower than that of
recent years.
2013 2014 2015 2016 20172016-17
% ch
Food and beverage 420.6 449.0 485.0 519.7 543.9 4.7%
Retail 395.1 398.9 411.5 430.8 437.4 1.5%
Lodging 301.7 328.7 374.9 426.5 453.1 6.3%
Recreation 226.6 236.5 248.2 265.5 274.9 3.5%
Transportation (local) 232.8 234.6 221.2 222.0 230.2 3.7%
Second homes value 55.8 59.1 82.6 81.2 90.4 11.4%
Air 3.2 3.4 3.6 3.8 4.4 15.4%
Total 1,635.9 1,710.4 1,826.9 1,949.5 2,034.4 4.4%
% change 6.9% 4.6% 6.8% 6.7% 4.4%
Visitor Spending By Category
(US$ Million)
16
Asheville visitor spending
⚫ Most visitor spending occurs at businesses in the City of Asheville:
79% of food and beverage, 73% of retail, 81% of lodging, and 84% of
recreation spending.
Asheville
Rest of
County Total
Food and beverage 427.6 116.3 543.9
Retail 317.8 119.6 437.4
Lodging 365.6 87.5 453.1
Recreation 232.1 42.8 274.9
Transportation (local) 174.1 56.1 230.2
Second homes value 27.6 62.9 90.4
Air - 4.4 4.4
Total 1,544.8 489.6 2,034.4
Visitor Spending by Location
(US$ Million)
Economic Impacts
18
How visitor spending generates impact
▪ Induced: Lastly, the induced
impact is generated when
employees whose incomes
are generated either directly
or indirectly by tourism,
spend those incomes in the
Buncombe County economy.
• Direct: Travelers create direct economic value within a discreet group of sectors (e.g.
recreation, transportation). This supports a relative proportion of jobs, wages, taxes, and
GDP within each sector.
• Indirect: Each directly affected sector also purchases goods and services as inputs (e.g.
food wholesalers, utilities) into production. These impacts are called indirect impacts.
19
Tourism sales
⚫ Including indirect and induced business sales, tourism generated
more than $3.1 billion in revenue in 2017.
Direct Indirect Induced Total
Agriculture, Fishing, Mining - 0.3 0.2 0.4
Construction and Utilities - 48.8 15.5 64.3
Manufacturing - 17.2 7.4 24.6
Wholesale Trade - 9.8 17.2 27.0
Air Transport 4.4 2.7 4.3 11.4
Other Transport 71.1 24.1 8.9 104.1
Retail Trade 437.4 5.0 46.6 488.9
Gasoline Stations 133.9 0.3 4.0 138.2
Communications - 39.9 17.4 57.3
Finance, Insurance and Real Estate 115.7 141.8 155.5 413.0
Business Services - 150.8 40.4 191.2
Education and Health Care - 1.7 114.1 115.8
Recreation and Entertainment 231.1 10.8 8.2 250.1
Lodging 453.1 0.9 0.5 454.6
Food & Beverage 543.9 25.9 38.7 608.6
Personal Services 43.8 18.9 24.9 87.5
Government - 20.9 8.5 29.4
TOTAL 2,034.4 519.8 512.3 3,066.5
* Direct sales include cost of goods sold for retail sectors
Tourism Sales
(US$ Million)
20
0
100
200
300
400
500
600
700
F&
B
Reta
il T
rade
Lodgin
g
FIR
E
Recre
ation
Bus. S
erv
ices
Ga
s
Education
Oth
er
Tra
nsp
Pers
onal
Serv
.
Constr
uction
Com
m.
Induced
Indirect
Direct
Tourism Sales by Industry$ million
F&B: Food and BeverageFIRE: Finance, Insurance, Real EstateBus. Services: Business ServicesGas: Gasoline StationsOther Transp: Other TransportationManu.: ManufacturingPersonal Serv.: Personal ServicesComm: Communication
Tourism sales
* Direct sales include retail cost of goods sold
Significant indirect
benefits
21
Tourism share of key industry employment
⚫ Tourism is a significant part of several industries – tourism directly
supports nearly all of lodging employment, 47.3% of recreation,
and 46.8% of food and beverage employment.
14.9%
16.5%
46.8%
47.3%
98.9%
0% 20% 40% 60% 80% 100%
TotalEconomy
Retail
Food & bev.
Recreation
Lodging
Direct
Indirect and induced
Tourism Employment Intensity by Industry
Source: Tourism Economics
Share of industry employment
22
Tourism employment details
⚫ The tourism industry supported 27,241 jobs or 15.0% of employment
(1-in-7 jobs) in Buncombe County in 2017, including indirect and
induced impacts.
Direct Indirect Induced Total
Agriculture, Fishing, Mining - 4 3 7
Construction and Utilities - 274 61 335
Manufacturing - 57 12 69
Wholesale Trade - 62 108 170
Air Transport 13 8 13 35
Other Transport 808 209 75 1,092
Retail Trade 2,673 73 670 3,417
Gasoline Stations 183 3 38 224
Communications - 155 51 207
Finance, Insurance and Real Estate 120 786 450 1,356
Business Services - 1,842 498 2,340
Education and Health Care - 31 1,138 1,169
Recreation and Entertainment 2,895 206 127 3,228
Lodging 4,812 8 4 4,823
Food & Beverage 6,142 413 640 7,195
Personal Services 699 290 360 1,350
Government - 171 52 223
TOTAL 18,346 4,593 4,302 27,241
Tourism Employment
23
Tourism employment summary
⚫ As a labor intensive
collection of services,
tourism-related industries
are significant Asheville
area employers.
⚫ The more than 27,000
jobs supported by
Asheville area tourism
span every sector of the
economy, either directly
or indirectly.
⚫ The most significant
indirect impacts are in
business services and
finance, real estate and
insurance.
F&B: Food and Beverage
FIRE: Finance, Insurance, Real Estate
Bus. Services: Business Services
Gas: Gasoline Stations
Other Transp.: Other Transportation
Personal Serv.: Personal Services
Wholesale Tr.: Wholesale Trade
0
1,000
2,000
3,000
4,000
5,000
6,000
F&
B
Lodgin
g
Reta
il T
rade
Recre
ation
Bus. S
erv
ices
FIR
E
Pers
onal S
erv
.
Education
Oth
er
Tra
nsp
Constr
uction
Gas
Gov.
Induced
Indirect
Direct
Tourism Employment by Industry
24
Tourism personal income
⚫ Employees in the Asheville area earned $840 million as a
result of visitor activity in 2017.
Direct Indirect Induced Total
Agriculture, Fishing, Mining - 0.1 0.1 0.2
Construction and Utilities - 12.7 3.3 16.0
Manufacturing - 3.0 0.6 3.6
Wholesale Trade - 3.6 6.3 9.9
Air Transport 0.9 0.5 0.8 2.2
Other Transport 36.4 9.4 3.4 49.2
Retail Trade 67.0 2.2 20.2 89.3
Gasoline Stations 6.8 0.1 1.4 8.3
Communications - 8.8 3.0 11.8
Finance, Insurance and Real Estate 7.0 17.0 12.3 36.3
Business Services - 59.1 16.4 75.5
Education and Health Care - 0.6 57.9 58.5
Recreation and Entertainment 70.7 2.7 2.8 76.2
Lodging 126.7 0.3 0.1 127.1
Food & Beverage 184.8 9.5 15.1 209.4
Personal Services 25.8 10.8 13.1 49.7
Government - 12.7 3.5 16.2
TOTAL 526.0 153.2 160.4 839.6
Tourism Labor Income (Compensation)
(US$ Million)
25
Tourism personal income
⚫ The average compensation of tourism-generated jobs was
just under $31,000 per year in 2017
Direct Indirect Induced Total
Agriculture, Fishing, Mining - 24.8 29.1 26.7
Construction and Utilities - 46.5 53.8 47.8
Manufacturing - 52.2 51.2 52.0
Wholesale Trade - 58.0 58.0 58.0
Air Transport 63.9 63.9 63.9 63.9
Other Transport 45.1 45.0 44.8 45.1
Retail Trade 25.1 29.5 30.1 26.1
Gasoline Stations 37.0 37.0 37.0 37.0
Communications - 56.7 58.3 57.1
Finance, Insurance and Real Estate 58.1 21.6 27.4 26.8
Business Services - 32.1 33.0 32.3
Education and Health Care - 20.6 50.9 50.1
Recreation and Entertainment 24.4 13.2 21.7 23.6
Lodging 26.3 33.3 33.3 26.3
Food & Beverage 30.1 23.0 23.6 29.1
Personal Services 36.9 37.2 36.3 36.8
Government - 74.3 67.4 72.7
TOTAL 28.7 33.3 37.3 30.8
Average Tourism Compensation
(US$ thousands per job)
26
Tourism tax generation
⚫ Tourism generated $199.1 million
in state and local revenues,
providing tax relief of $1,950 in tax
relief per household in the County.
⚫ Including property tax sustained by
tourism, the industry supported
$27.9 million in revenues for the
City of Asheville.
⚫ In Asheville, Tourism supported
taxes would fund:
■ the entire fire budget ($24.4m)
■ the entire police budget ($26.9m)
■ Parks and Rec 2.8 times ($10.1m)
Total
Federal 169.0
Personal Income 39.5
Corporate 24.5
Indirect business 20.0
Social Security 85.0
State 108.2
Personal Income 16.7
Corporate 3.0
Sales 73.7
Social Security 0.8
Other Taxes and Fees 14.0
Local - City 27.9
Sales 6.2
Property 20.6
Other Taxes and Fees 1.1
Local - Rest of County 63.1
Sales 28.7
Property 32.4
Other Taxes and Fees 2.0
TOTAL 368.1
Tourism-Generated
Tax Revenues
2017, Millions
27
Buncombe County tourism in context
⚫ Taken as an industry, with
more than 18,000 direct
jobs Tourism is the third
largest employer in the
County, larger than
Manufacturing,
Construction, Finance,
Education, and Information.
0 5 10 15 20 25 30
InformationEducation
State Gov'tAccommodation
FinanceRecreation
Local Gov''tConstruction
Prof/Bus ServReal Estate
ManufacturingFood serv.
TourismRetail
Healthcare
Asheville Region Jobs by IndustryBuncombe County, thousands, 2017
Sources: BEA, BLS, Tourism Economics
Methodology and Background
29
⚫ By monitoring tourism’s economic impact, policy makers
can make informed decisions regarding the funding and
prioritization of tourism development.
⚫ It can also carefully monitor its successes and future
needs.
⚫ In order to do this, tourism must be measured in the
same categories as other economic sectors – i.e. tax
generation, employment, wages, and gross domestic
product.
Why quantify the tourism economy?
30
Why is this a challenge?
⚫ Most economic sectors such as financial services,
insurance, or construction are easily defined within a
region’s economic statistics.
⚫ Tourism is not so easily measured because it is not a
single industry. It is a demand-side activity which affects
multiple sectors to various degrees.
⚫ Tourism spans nearly a dozen sectors including lodging,
recreation, retail, real estate, air passenger transport, food
& beverage, car rental, taxi services, travel agents,
museums, and theme parks.
31
• Estimates of visitor expenditures in Buncombe County were based on several sources:
• Smith Travel Research (STR) data on hotel room demand, supply, and revenues.
• County level tax data on sales and hotel occupancy receipts.
• Visitor profile and volume, and spending estimates from Longwoods International, a
national tourism research firm.
• Industry data on employment, wages and sales from the U.S. Census, the Bureau
of Economic Analysis, and the Bureau of Labor Statistics.
• Data on short-term rentals available from the Asheville CVB and AirDNA
• An IMPLAN input-output model was constructed for Buncombe County. The model
traces the flow of visitor-related expenditures through the local economy and their
effects on employment, wages, and taxes. IMPLAN also quantifies the indirect (supplier)
and induced (income) impacts of tourism. Tourism Economics then cross-checked these
findings with employment and wage data for each sector to ensure the findings are
within reasonable ranges.
• The primary source of the employment and wage data is the Regional Economic
Information System (REIS), Bureau of Economic Analysis. This is more comprehensive
than Bureau of Labor Statistics (ES202/QCEW) data because sole-proprietors do not
require unemployment insurance and are not counted in the ES202 data.
• Gasoline price data were obtained from the U.S. Energy Information Administration.
Methods and data sources
32
Description of spending categories
Spend Category Description
Lodging Includes visitor spending in the accommodation sub-sector. This includes
food and other services provided by hotels and similar establishments.
Recreation Includes visitors spending within the arts, entertainment and recreation sub-
sector.
Local transport
Includes visitor spending on local transport services such as taxis, limos,
trains, rental cars, and buses.
Shopping
Includes visitor spending in all retail sub-sectors within the Buncombe
County economy.
Service stations
Visitor spending on gasoline. Only the margin counts as local economic
impact.
Second homes
Where applicable, spending associated with the upkeep of seasonal second
homes for recreational use as defined by the Census Bureau.
Food and beverage Includes all visitor spending at restaurants and bars.
33
About Tourism Economics
⚫ Tourism Economics, headquartered in Philadelphia, is an Oxford Economics
company dedicated to providing high value, robust, and relevant analyses of
the tourism sector that reflects the dynamics of regional and global economies.
By combining quantitative methods with industry knowledge, Tourism
Economics designs custom market strategies, project feasibility analysis,
tourism forecasting models, tourism policy analysis, and economic impact
studies.
⚫ Our staff have worked with over 100 destinations to quantify the economic
value of tourism, forecast demand, guide strategy, or evaluate tourism policies.
⚫ Oxford Economics is one of the world’s leading providers of economic analysis,
forecasts and consulting advice. Founded in 1981 as a joint venture with Oxford
University’s business college, Oxford Economics is founded on a reputation for
high quality, quantitative analysis and evidence-based advice. For this, it draws
on its own staff of 70 highly-experienced professional economists; a dedicated
data analysis team; global modeling tools; close links with Oxford University,
and a range of partner institutions in Europe, the US and in the United Nations
Project Link.
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