State of Tourism in NSW

NSW is a State that is not only Australia’s international gateway, but a nationally and internationally recognised destination for visitors, hosting some 35.8 million overnight visitors in the year ending December 2017. Whether these visitors are drawn to NSW for business, holidays, family or as part of a wider Australian visit, they form part of the State’s visitor economy.

Value of tourism in NSW

Tourism contributed $34.2 billion Gross State Product to the NSW economy in 2016-17. There has been a 50.4 per cent growth in the sector since March 2011. This represents a significant economic benefit across Sydney and regional NSW.

We know Sydney is experiencing room occupancy rates of 87.9%, compared with regional NSW at 67.3%. This means regional NSW presents an enormous opportunity to disperse visitor nights and expenditure and optimise visitor economy growth across the State.

In December 2017, annual NSW takings from accommodation were the highest on record, increasing 8.4% to $1.4 billion, mainly due to revenue growth of 10.3% in regional NSW and 8.4% in Sydney4.

In addition, Tourism Research Australia highlighted that in 2016-17, 43 cents of every tourist dollar went to regional Australia5. Many regional economies are influenced by visitation and tourism, with regional visitor expenditure heavily concentrated on a few activities. NSW makes up 30 per cent of Australia’s total tourism consumption with an estimated $40.5 billion of tourism related products consumed in NSW in 2016-176.


4    Tourist Accommodation Snapshot – December Quarter 2017. Source Destination NSW
5    State of the Industry 2016 – 2017, Tourism Research Australia
6    State Tourism Satellite Accounts 2016-17 and Tourism Businesses in Australia as at June 2017, Tourism Research Australia
 

Overnight visitors to NSW have increased 5.2 per cent with spending up 6.8 per cent. International visitors make up almost half (48 per cent) of overnight stays in NSW. Our transport services need to meet the needs of our culturally and linguistically diverse visitors. Visitors from non-English speaking countries now outnumber visitors from English speaking countries. In the year to January 2017, NSW welcomed 3.1 million international short-term visitors.

 Volume2017 vs 2016 NSW growthDomestic share of NSW totalInternational share of NSW total
Visitor nights194.5 million6.5%51%49%
Overnight visitors35.7 million8.1%88%12%
Overnight visitor spend$29.1 million10.9%64%36%

Source: National and International Visitor Surveys, YE December 2017, Tourism Research Australia

The recently endorsed Visitor Economy Industry Action Plan 2030 identifies the NSW visitor economy as being stronger than ever. NSW is the number one state in terms of visitor nights, numbers and expenditure. In calendar year ending December 2017, overnight visitor expenditure in NSW reached an impressive $29.1 billion. VEIAP 2030 details 43 actions under six focus areas to build on this success, and to reach ambitious new visitor economy targets.

Employment

The tourism sector employed 262,000 people in NSW in 2017 (directly and indirectly). This is equivalent to one in 15 jobs. Direct jobs include those in hospitality, travel agencies and tour operation. Encouraging the tourism sector to procure locally produced goods and services will maximise the economic impact of tourism revenue in regions and can lead to further indirect job growth.

Why people visit NSW

Visitors to NSW can be segmented in multiple ways including area of interest, demographics and purpose of trip; from business to backpackers, international students and caravan and camping travellers. Destination NSW regularly produces profiles on different segments that exist in the NSW visitor economy. Transport enables each of these in different ways. Some examples of how transport needs vary for different segments are provided below. 

Visiting Friends and Relatives

Visiting Friends and Relatives accounts for more than a third of international and domestic overnight visitors to NSW. Hosts are highly likely to accompany visitors to activities and attractions, especially international visitors. Visitors staying with friends and relatives look for local experiences and typically use local public transport and self-drive options to get to destinations.

Aboriginal Tourism

NSW has the largest Aboriginal population in Australia, and is an ideal location for international and domestic visitors to learn and engage with the world’s oldest culture. ‘Aircraft’ (29.3%) was the most common transport mode used by international visitors who participated in Aboriginal tourism in NSW in 2017. ‘Private vehicle or company car’ (25.6%) was the second most common, followed by ‘local public transport’ (10.5%).

Food and Wine Tourism

Food and wine experiences have become key drivers of destination choice amongst many domestic and international visitors. Many regions in NSW and the rest of Australia feature food and wine experiences as core tourism products that are integral to the success of the local tourism industry.

NSW received nearly five million food travellers who stayed for nearly 59.4 million nights in the State. Food travellers spent an estimated $8.5 billion in the NSW. ‘Private vehicle or company car’ (28.9%) was the most common transport used by international food travellers, followed by ‘aircraft’ (27.9%) and ‘taxi or chauffeur driven hire car’ (22.6%).

Nature-based Tourism

Nature-based tourism includes outdoor and nature experiences and is one of the main reasons people visit regional NSW. Forty-five per cent of overnight visitors to regional NSW participate in a nature tourism experience. In 2017, visitors who took part in a nature-based activity stayed
48.8 million nights in regional NSW, spending $8.2 billion.

Cultural and Heritage Tourism

NSW received 12.3 million international and domestic cultural and heritage visitors in 2016, spending an estimated $12 billion, an increase of 7.6 per cent on 2015. The value of cultural tourism is expected to increase further through the rollout of the $100 million Regional Cultural Fund and with cultural infrastructure earmarked as part of the Cultural Infrastructure Plan 2025+.

Accessible Tourism

Accessible tourism is about making it easy for all people to enjoy tourism experiences. This includes: older people, those with a disability, people from non-English speaking backgrounds and people travelling with children.

In the first quarter of 2017, 1.2 million people with disabilities or long term health conditions travelled domestically to stay overnight in NSW. Around a quarter came from Sydney (24%), followed by the South Coast (8.5%), Central Coast (8%) and the Hunter (7.5%). From interstate, Queensland and Victoria were top source markets (at 12.5% and 11%, respectively).

‘Private vehicle or company car’ (80%) was the most popular form of transport used by domestic visitors with disabilities or long term health conditions, followed by ‘aircraft’ (11%) and ‘railway’ (6%).
 

Tourism in Sydney and regional NSW

In 2017 NSW received 93.7 million visitors, who stayed 194.5 million nights and spent $29.1 billion. Of those 64% visited Regional NSW and 36% Sydney.

Sydney

Sydney is the number one capital city in Australia for visitors, nights and expenditure. Sydney received 3.9 million international overnight visitors who spent 79.7 million nights in Sydney in 2017. The highest numbers of visitors were from mainland China, who accounted for 19.5% of international visitors and stayed for 18.5 million nights, spending $3.1 billion in 2017.

‘Visiting friends and relatives’ (35%) was the main purpose of the visit for the largest proportion of domestic overnight visitors to Sydney, followed by ‘business’ (33%) and ‘holiday’ (24%).

Regional NSW

Regional NSW is vitally important to the visitor economy in NSW. Domestic and international visitors to NSW destinations outside Sydney generated 88.1 million nights of accommodation NSW and $16.3 billion in visitor (overnight and day trip) expenditure in 2017. ‘Holiday’ (46%) was the largest purpose of visit for overnight visitors to regional NSW, followed by ‘visiting friends and relatives’ (35%) and ‘business’ (13%). Regional NSW was the largest source of overnight visitors to Sydney (39%) and Sydney was the largest source of overnight visitors to regional NSW (36%).There is a great opportunity to grow the visitor numbers in regional NSW by showcasing the destinations and attractions on offer.

Visitor numbers vary across NSW. The North Coast is the most visited regional destination, followed by the Hunter and the South Coast. Day trips make up the largest portion of visitor numbers in each area apart from Outback NSW and the Snowy Mountains. More can be done to grow the share of international visitors to regional areas in NSW through services, infrastructure, information and development of products to enable increased regional dispersal.

Transport can play a major role in growing regional tourism, by providing new and more convenient ways to get to and travel around regional destinations and attractions. We can also showcase these destinations through advertising on the network and improving roadside signage.

Airports bring the largest number of international visitors to our shores, while road travel is the main way domestic visitors travel within NSW.