Tourism Driving Growth in New York, California, Florida

Wall Street Journal: A rebound in tourism is helping drive economic growth in three key U.S. markets despite data, including Friday’s jobs report, that shows the overall recovery is slowing.

There’s been a pickup in the number of tourists and business travelers in New York City, Southern California and Central Florida in the past six to 12 months, which has boosted state and local sales tax revenue, hotel occupancies and employment in the leisure and hospitality sector.

Recent jobs data suggest hospitality is at least one bright spot in a sputtering economy, analysts said.

“It’s more than just a silver lining,” said Steven Cochrane, managing director at Moody’s Analytics in West Chester, Pa. “The recession is over and one of the reasons why is travel and tourism spending in these markets.”

Though the leisure and hospitality industry lost 6,000 jobs in May, it added about 126,000 jobs during the previous three months — accounting for about 20% of total non-farm payroll gains. Economists say pent-up demand is fueling domestic tourism, as families begin to take trips postponed during the recession. Visits from international travelers have increased too, prompted in part by the weaker dollar.

Sean Snaith, an economics professor at the University of Central Florida, said many people feel more secure about their jobs and are taking trips again. Rachel Atkinson, the district manager for a staffing agency in Colorado Springs, said her commission income rebounded last year, which helped her and her husband take their daughter to Orlando for a national cheerleading competition.

“It would have been tougher for us,” she said.

Occupancy rates and the average daily rate hotels are rising in these markets, according to Smith Travel Research Inc. In the Los Angeles-Long Beach market, occupancy levels in April increased to 71.1% from 66.3% a year earlier, while the average daily rate increased to $119.38 from $114.54. In New York City, average daily room rates rose to $236.41 from $217.19.

In Central Florida, the rebound in tourism has been dramatic. The two major airports that serve Orlando saw passenger traffic increase 60.57% the first three months of 2011, according to Moody’s Analytics.

Last month Orlando Mayor Buddy Dyer said the city would move forward with the construction of a $425 million state-of-the-art performing arts center. The project, funded by a six-cent Orange County resort tax, was delayed during the recession.