Tourism and hospitality

From CEOpedia | Management online

Tourism and hospitality industry is a complex of interconnected enterprises and other organizations involved in the production of goods and services, which would not be profitable, if not for the demand of the tourists. This industry include following sectors:

  • accommodation sector
  • gastronomy sector
  • tourist attractions sector
  • transport sector
  • sector of travel agencies
  • tourism and tourist information sector

Economic Impacts

There is a lot of impacts, positive or negative. At first it's important to mention about positive sites. It includes for example foreign exchange, GDP growth and increases in income. Very big percentage of employment depends on tourism. Tourism often injects money into the community that leads to secondary economic development as well.

However, there are also negative impacts. Seasonality of the tourism industry is really dangerous for local residents. It is bad for the whole economic system to focuse too many resources on one industry sector. One example is the New Jersey shore after the devastation of Hurricane Sandy. The tourism industry was destroyed, there were no profits for the local residents[1].

Social Impacts

Of course, tourism has also very big impact on socioal life. For example, an increase in amenities (parks, recreation facilities), investment in arts, culture, heritage and tradition, celebration of indigenous communities. Tourism has also influence on language, social and cultural life, religion and politics.. Negative social impacts of tourism can include: change or loss of indigenous identity and values; culture clashes; changes in family structure; and ethical issues, including an increase in sex tourism, crime, gambling, and the exploitation of child workers[2].


Data about employment and unemployment in leisure and hospitality are obtained from employer or establishment surveys mostly, but information on industry unemployment comes from a national survey of households. In United States, in October 2018, the unemployment rate was 5,4%. Average hourly earnings was $16.11. And about trends: establishments with changes in employment in 4th quarter 2017 with job gains was 275 and with job losses was 269[3].

Drivers for change

The tourism and hospitality sector has really big amount of employee - 200 milion people and it generates more than 10 percent of global GDP. This sector includes tour operators, accommodation, transport providers and entertainment. All of those things have a big impact on the environment through infrastructure, sanitation utilities, water and electricity consumption and waste generation. There are many environmental drivers for change[4]:

  • Protecting natural habitats (including beaches, coral reefs, rainforests, mountain ecosystems, and savannahs)
  • Responding to increasing demand and diverse customer needs
  • Opportunities for cost savings
  • Taking care of natural environment
  • Improving the economic situation of the country


According to Cambridge English Dictionary, standardization is the process of making things of the same type have the same basic features [5]. What the tourist industry offers, must meet tourists desires. It should not to be too new or strange and in the same time diversify with some features from the others companies.


Tourism and hospitalityrecommended articles
Examples of opportunitiesGlobalizationSocial and cultural factors affecting businessEconomic infrastructureEconomic factorEffects of tourism developmentBasic industryExamples of threatsEnvironmental factors affecting business


  1. Skripak, S., J. (2016)Hospitality and Tourism "Fundamentals of Business", July 2016, Chapter 15
  2. Skripak, S., J. (2016)Hospitality and Tourism "Fundamentals of Business", July 2016, Chapter 15
  3. Bureau of Labor Statistic (2018)Leisure and Hospitality "Industries at a Glance"
  4. International Finance Corporation (2004) Tourism and Hospitality "A Guide to Biodiversity for the Private Sector"
  5. "Standardization"

Author: Maja Rogalska