New report shows how much COVID-19 cost Arizona tourism industry

PHOENIX – A week after the Arizona tourism industry received word that over $100 million of support was on the way, data was released Tuesday showing just how hard COVID-19 hit the massive sector last year.

Travelers spent $15 billion in Arizona in 2020, according to a fresh Arizona Office of Tourism report, which might seem like a lot. But it was down 41% from the previous year’s record level.

The decrease in spending resulted in a 28.1% decline to $2.7 billion in tax revenue, with the local level down 32.3%, state falling by 31.7% and federal taking a 22.6% plunge.

In 2019, travelers spent $25.6 billion in Arizona, generating $3.78 billion in tax revenue.

“We know that 2020 was a challenging year, really, for everyone, but hospitality and tourism were especially hard hit,” Debbie Johnson, director of the Arizona Office of Tourism, told KTAR News 92.3 FM.

“So we weren’t necessarily surprised by these numbers, but it’s shocking and disappointing nonetheless.”

Even with support from CARES Act funding, the number of tourism jobs in the state fell by 17.4% to 160,500 in 2020, with earnings down by 13% to $6.7 billion. A record 194,300 tourism industry jobs were directly generated from tourism spending in 2019.

With air travel limited during the pandemic, it’s no surprise that international visitation took a bigger hit than domestic travel. The number of international travelers plummeted by a projected 68% last year, with overseas visitation down a whopping 84%. The domestic decline, meanwhile, was 25.8%.

About 9.1 million domestic overnight visitors, almost one-third of the 30.14 million total, were Arizonans exploring their own state.

“I’ve got to give a big shoutout to our in-state visitors, to our Arizonans who really did get out and take a lot of in-state road trips in 2020, which really kept our visitor industry going, Johnson said.

Last week, Gov. Doug Ducey announced that $101.1 million of federal relief money from the American Rescue Plan was being allocated for tourism marketing, local community programs, event support and outdoor recreation improvements through a program called the Visit Arizona Initiative.

Grant application instructions will be posted to the Arizona Office of Tourism website by July 30.

“We have about $60 million in grant funding that will be going out to our industry,” Johnson said. “We’re working on some guidelines right now; it all came together very quickly.”

KTAR News 92.3 FM’s Ali Vetnar contributed to this report.

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