Florida Tourism Faces Lengthy Restoration As Unemployment Claims Rise

A top Florida economist warns that the vital but ailing tourism industry is facing another difficult spring due to COVID-19.

Amy Baker, co-ordinator for the Legislature’s Bureau of Economic and Demographic Research, told lawmakers Wednesday that despite improved tax revenues for December, high-spending overseas tourists are unlikely to flock to Florida in the coming months due to the pandemic.

“It is possible that we will see greater negative effects this quarter, but not necessarily a worsening of conditions,” said Baker, referring to the January to March period, which usually ends with an influx of spring breakers. “But we will have lost the great amount of people who normally help us.”

The state has seen an increase in the number of people visiting Florida, which was a target for Visit Florida, the state’s tourism marketing arm. But Baker said these tourists don’t, on average, spend as much time or money as overseas travelers and others flying to Florida.

And Baker said during an appearance before the House’s Tourism, Infrastructure and Energy subcommittee that while tourism numbers show expected improvements in the coming year, it may not be until 2024 before normalcy returns to the hospitality and leisure industries, which most affected by the pandemic.

“So 2021 will still be low. By the time we get to 2022, you can see that we’re having pretty strong growth, ”said Baker. “From that point on, we think it will be a slower recovery, but that we should get closer to normal enough to say we have recovered by 2024. So that’s our current expectation.”

Baker’s comments came before the US Department of Labor released a report Thursday that an estimated 57,824 first-time unemployment claims were filed in Florida last week, 18,598 more than the week ended January 16.

The federal agency, which highlighted the recent layoffs in the Florida construction and manufacturing industries, initially estimated 26,559 initial filings were made in the week ended Jan. 16, but increased the number to 39,226 on Thursday.

According to the agency, the state has had an average of just under 28,000 new claims per week since mid-November.

Last week, the Florida Department of Economic Opportunity announced that the state’s unemployment rate improved from 6.3 percent in November to 6.1 percent in December. This reflected 614,000 Floridians who qualified as unemployed in December from more than 10.14 million workers.

The latest unemployment estimates are well below the peak of the pandemic, when business stalled and nearly 940,000 claims came in in the weeks ending April 18 and 25. In the second quarter of last year, travelers to Florida fell 60.3 percent over the same period. 2019 ended a nine-year streak of year-on-year tourism growth.

The number of tourists rose in the third quarter of 2020 (July to September) as Governor Ron DeSantis pushed for the economy to reopen. However, the overall estimate still declined 31.8 percent from the same period in 2019.

Questions about the future of business travel remain unanswered, according to Baker as companies responding to the pandemic continue to use remote working and communication technology instead of face-to-face meetings.

Preliminary tourism figures for the fourth quarter were not released.

Florida’s overall tax revenue has shown some positive signs in recent months.

Baker’s Office reported Tuesday that the state raised roughly $ 336.7 million more in general revenue in December than it had projected in August. Total revenue of $ 2.999.4 billion was also $ 154.4 million higher than forecast prior to the pandemic.