Pessimism Prevails In Tourism Sector

Mari Daskalantonaki, president of the Tourism Research Institute, says she expects to see a substantial drop in employment within Greece’s tourism sector this year.

Greece’s public sector tourism leaders continue their attempts to support tourism sector moral in the face of what appears to be a very difficult year for the sector. But while they insist on a minor drop in arrivals this year, the private sector foresees a major drop in arrivals, overnights and overall revenue.

A study released last month by the Tourism Research Institute (ITEP) foresees, at the very least, a drop of 5% in arrivals this year.

Last year, some 12.1 million visitors were welcomed here compared with 12.3 million the year before. Revenue dropped some 8% last year compared with the year before.

But tourism professionals in the private sector are even more pessimistic. Many feel Greece will be lucky to see just a 10% drop in arrivals with an even bigger drop in revenue. “Our only hope at the moment is to see an end to the SARS (Severe Acute Respiratory Syndrome) scare followed by a barrage of last-minute bookings, especially from Germany and the UK,” they say.

But even if a cure is found shortly, the Research Institute’s director, Professor P. Pavlopoulos, believes this will simply help confine the drop in arrivals this year to somewhere around 5%.

Mari Daskalantonaki, the institute’s president, stressed an expected drop in employment within the tourism sector. “Already,” she said, “most hotel and resort units outside the capital opened a month later than usual.” As well, along with drastic cuts in room rates, visitors are cutting their overnight stays by more than 20% when compared with previous years.

She added that the first place hoteliers look to cut costs is in manpower. That’s because “employment costs at four- and five-star hotel units make up between thirty-five and forty-five percent of all hotel revenue.”

Vassilis Plevris, vice president of the Greek Hotel Chamber, reminded that a drop in hotel manpower does not mean a drop in the quality of hotel services. As an example, he said that if a 500-room hotel has only 200 bookings, on average, it could easily offer the same service with a major reduction in staff as with 70% occupancy and a full staff.

Professor Pavlopoulos quickly added that the accommodation sector is and remains one of the best quality products available in the tourism industry.

Ms. Daskalantonaki stressed that when we refer to the need to increase the quality of the Greek tourism product we refer in most cases to the public sector, which includes prefecture and municipal leaders. It’s here, she said, that a major effort must be made to upgrade our tourism product.

On a more positive note, the institute predicts that Greece will see a major increase in its city tourism, which today accounts for a mere 7-8% of tourism arrivals.

But with the 2004 Games and the numerous infrastructure changes taking place, as well as the upgrading of all hotel properties, the institute expects to see city tourism increase to more than 20% in the immediate future. Presently, city tourism makes up 21% of the total in Turkey and 28% in Spain.