In hospitality and tourism, an exogenous factor is an external event that wreaks havoc on the sector — though the event itself is unexpected, unpredictable, and can’t be controlled by traditional measures. Known by some as acts of God or nature, examples of exogenous factors include tsunamis, hurricanes, terrorist attacks, and recently, the novel coronavirus (COVID-19).
A native of Italy, Marta Soligo felt the impacts of COVID-19 weeks before the Las Vegas Strip went from bustling tourist attraction to temporary ghost town — as her entire home country boarded up for an indefinite quarantine. A Ph.D. candidate in sociology who studies tourism and culture and also a research assistant at UNLV’s International Gaming Institute, Soligo recently broadened the scope of her research to include the effects of COVID-19 on thriving tourist destinations such as Italy and Las Vegas. During this time, Soligo stresses the importance of separating fact from fiction, finding reliable research, and keeping tourism — including family-owned businesses — top of mind.
Impacts of Tourism and Why It Matters
Not long ago, Soligo remembers telling students of her Sociology of Leisure class (SOC 417) that tourism was one of the few global job sectors that kept increasing — with more tourists traveling year after year. In fact, before the coronavirus outbreak, the World Tourism Organization (UNWTO), a specialty agency within the United Nations, predicted positive growth in the sector of 3 to 4 percent. But now, the same organization has revised its 2020 prospects for international tourist arrivals, which might fall between 20 and 30 percent, translating to a loss of $300 to $450 billion.
Digging deeper into the numbers, according to Soligo and UNWTO:
- Tourism currently represents 10 percent of the world’s gross domestic product (GDP).
- One out of every 10 jobs in the world is in tourism.
- There are almost twice as many women entrepreneurs in tourism compared to any other sector.
But the contingent effects of tourism (or loss of tourism) have widespread impacts on more businesses and industries than just hospitality. For example, going to a local grocery store to buy sunscreen for a trip to the beach or visiting a gas station before a long road trip are both indirectly part of the tourism economy.
“If we think of the indirect effects of tourism,” said Soligo, “it’s clear that this issue goes way beyond resorts and theme parks; the tourism industry’s importance cannot be overstated and, without it, so many industries suffer. Especially, it is important for institutions to understand the importance of undertaking programs to support local communities in tourism destinations that are — and will be — affected by the COVID-19 threat.”
So, What Is Italy Doing?
Not only is Italy an international tourist destination, but the bulk of its hospitality industry is family-owned small and medium-sized businesses. “Small and medium-sized enterprises make up around 80 percent of the tourism industry globally, and Italy is the country of small and medium-sized enterprises,” said Soligo.
With no one coming to visit her home country in the foreseeable future, she wondered, “What’s going to happen to us? What about locally based tourism? Beyond money and the economy — I’m thinking about families and their livelihoods from a sociological perspective. We need to be asking ourselves, ‘How can we help these small business owners who rely on tourism to feed their families?’”
Aside from the mandatory quarantine, Italy is working to stimulate its economy through measures such as financial relief for small and medium businesses (in the tourism industry and otherwise), tax reductions, and optional utility bill payment delays. For adults who work in hospitals, grocery stores, and pharmacies — the few “essential” businesses that remain open—the Italian government also offers options for childcare, such as vouchers to pay for babysitters for families with children under 12 years.
And for those planning vacations after the coronavirus pandemic ends, Italy is encouraging its citizens to help local entrepreneurs by staying in Italy and “traveling Italian.”
...And What Can We Do?
Though the economic impacts of loss of tourism are undeniable, it is important to remember that the coronavirus is first and foremost a health issue. “Everyone, from big corporations to single tourists, must collaborate to defeat this virus. We need to follow official guidelines mandated by the Centers for Disease Control and the World Health Organization,” said Soligo, “I am an advocate of travel and tourism, of course, when done in a sustainable way, but right now, my best advice is to stay home. Without an improvement in general health conditions, no progress can be made from a social, financial, or tourism point of view.”
And like UNWTO recently said, “Staying home today means traveling tomorrow.”