Tourism impacts significantly on the Australian economy. In 2003-2004 the tourism industry accounted for $32 billion directly and nearly $26 billion indirectly of total Gross Domestic Product. This is equivalent to 7.1 per cent of the Australian Gross Domestic Product.

This indirect economic information is important for efficient and effective policy decisions to guide the future development of tourism. To obtain this information, Tourism Research Australia requires an economic model based on the Tourism Satellite Account which estimates tourisms direct effects. The direct effect of tourism is when the change in tourism expenditure immediately affects production.

Indirect Economic Modelling Methodology

Indirect effects of tourism can be calculated by using IO analysis based on a fundamental identity equating supply and demand in the economy.

The indirect economic contribution model provides a foundation for more sophisticated analyses of the impact of tourism, and the comparison of different policy options using techniques such as computable general equilibrium modelling.

The methodology and the underlying model that Tourism Research Australia uses to calculate the indirect economic contribution was constructed by Salma (2001). The latest input-output (IO) tables are based on the 1998-99 input-output table published by the Australian Bureau of Statistics. When modelling, Tourism Research Australia makes the assumption that the industry structure of the Australian economy remained the same between the years of the latest IO table and the present.

The analysis uses input coefficients generated by econometric equations that predict input purchases by industries based on the economy's characteristics. Outputs include total industry output, employment, and value-added for 39 industry sectors in the Australian economy.

Total industry output is defined as: the value of annual production by industry. Employment includes total wage and salary employees, for both full-time and part-time workers. Total value added is defined as all income paid to workers by employers; self-employed income; interests, rents, royalties, dividends, and profit payments; and excise and sales taxes paid by individuals to businesses. The model can also be used for predictive purposes by providing estimates of multipliers.

Indirect Economic Contribution of Tourism to Australia

1998-99 TO 2003-04

The Indirect Economic Contribution of Tourism to Australia 1998-99 to 2003-04 article provides estimates of the indirect economic contribution of tourism to the economy between 1998-99 and 2003-04.

Results are based on Tourism Research Australia model of tourism indirect economic contribution. They complement the Australian Bureau of Statistics Tourism Satellite Account estimates of tourisms direct contribution to Gross Domestic Product, value added and employment.

To purchase a copy of this report contact Tourism Research Australia at tra@ret.gov.au 

Tourism Businesses

A lack of information on businesses in the tourism industry has long been noted. Release of the Australian Tourism Satellite Account 1997-98 by the Australian Bureau of Statistics in October 2000 corrected this deficiency at the national level. A large proportion of small businesses are related in some way to the Tourism industry. The majority of tourism related businesses are in State orTerritory capitals and the higher profile tourism regions.

The Tourism Businesses report builds upon the Tourism Satellite Account and provides more detailed information on businesses dependent on tourism demand, according to their degree of reliance, industry sector and location. This report looks at the role of tourism and small businesses in the national economy and discusses data sources and definitions used to obtain the results. The results are presented at the national level, then at state and regional levels. Numbers of businesses in industries, business distribution and the legal entities controlling tourism businesses are presented.