A stronger focus on tourism could add billions to the Canadian economy and create up to 180,000 new jobs, according to a new advisory report prepared for the federal government.
The report by the McKinsey & Company advisory firm says one of the main issues holding Canada back is its lopsided tourism profile as most visitors tend to come in the summer months. As a result, hotels and other tourism-reliant employers struggle to find staff in peak times yet are sometimes unable to recruit workers by offering year-round employment.
One solution: Convince the swelling ranks of globetrotters to embrace Canadian winters.
The advisers say it worked for Finland’s northern Lapland region, which promotes periods of round-the-clock darkness in winter as a must-see experience, among other winter activities.
Federal Tourism Minister Melanie Joly will release the report Monday before delivering a speech to the Economic Club of Canada in Toronto. An advance copy was provided to The Globe and Mail. She will be joined by Dominic Barton, McKinsey’s global managing partner emeritus and a volunteer member of a federal advisory panel on “jobs and the visitor economy” chaired by former New Brunswick premier Frank McKenna.
The McKinsey report is expected to be used by the panel and the government as Ottawa prepares a new tourism strategy that will be released by summer 2019 ahead of the fall federal election campaign.
Tourist visits to Canada set a record last year during the Canada 150 celebrations, with 20.8 million trips of one or more nights to Canada, according to Statistics Canada data released earlier this year. That total was up 4.4 per cent from the previous year and beat the previous record of 20.1 million visits in 2002.
Destination Canada – the federal Crown agency responsible for tourism promotion that commissioned the McKinsey report – stated in September that year-to-date figures show visits are up over 2017.
One of the main sources of growth is a 5 per cent increase in visits so far this year from China, including a record 94,000 visitors from China in September alone.
“It is difficult to overstate how important the Chinese market is,” the McKinsey report states, pointing out that visits from China to Canada tripled from 2007 to 2022 and could grow by another 40 per cent.
The report notes that while Americans will continue to dominate Canada’s tourism economy, China is now the world’s largest outbound travel market in terms of trips and spending.
“Chinese tourists are not only numerous but valuable: more than 70 per cent of Chinese tourists travel with family and friends, and have the highest international spend per trip among global travellers,” it states.
The McKinsey report was finalized before last week’s revelation that Canadian officials arrested a senior Chinese business leader at the request of the United States government.
China is now threatening Canada with “serious consequences” if it does not immediately release Meng Wanzhou, the chief financial officer of Huawei, a telecommunications firm.
It is not immediately clear if those consequences could include restrictions on tourist travel to Canada.
The main finding of the report is that Canada could “dramatically” grow its tourism sector if it simply matched what other successful countries are doing to attract visitors. Doing so, it states, would boost Canada’s visitor economy by between $15-billion and $25-billion a year, which represents between 110,000 and 180,000 new jobs.
The report says Canada spends about 20 per cent less on tourism marketing than similar countries, noting that Australia and Ireland spent more than twice as much per international tourist while New Zealand spends about four times more.
Other factors listed as holding Canada back is the high cost of air travel and the fact that only two major Canadian cities – Toronto and Vancouver – have light rail connections between downtown and the airport.