Source: pogled.hr/autor: Alenka JURIČIĆ BUKARICA
This year, employment in tourism is expected to grow to almost 26 million jobs at the European Union level, which would mean that the industry would account for 12 percent of all European jobs. The limiting factor for growth in Croatia is the insufficient number of domestic workers.
The European Union (EU) travel and tourism sector is set to continue growing, creating 4.5 million new jobs by 2035, bringing the total to more than 30 million. This year alone, employment at the EU level is expected to grow to almost 26 million, accounting for 12 percent of all European jobs in the industry.
This is a projection published by the World Travel and Tourism Council (WTTC), according to which, in parallel with the growth in the number of workers needed, the contribution of travel and tourism to the EU’s GDP will increase in Europe, to almost 2.3 trillion euros, with its economic share increasing to almost 11 percent in the next ten years. According to these projections, tourism should exceed the growth of the entire EU economy at an annual growth rate.
Abolition of quotas
In Croatia, according to data from the Central Bureau of Statistics (CBS), the number of employees in the accommodation and food preparation and serving sector grew by 3.5 percent in August last year, to some 115,000 people. It is estimated that tourism in the broader sense employs around 150,000 workers.
The contribution of tourism to employment is clearly demonstrated by data from the last ten years. Namely, the category of accommodation and food preparation and service had around 60,000 workers in 2015, and by 2019 that number had grown to around 95,000 workers, but during the pandemic the number of people employed in tourism fell to around seventy thousand. Since the pandemic of 2020 until today, there has been growth, which has in the meantime also been stimulated by the abolition of quotas for foreign workers.
The number of foreigners working in domestic tourism is increasing, which is also evident from the number of work permits issued for foreigners, of which last year there were about 56,000 in tourism, where about 15,000 work permits refer to seasonal workers in tourism. According to some estimates, Croatia could need a total of around half a million foreign workers by 2030, a good portion of which will be in the tourism sector. .
Commenting on how much the need for workers in tourism will grow in the coming years and where this growth will end, Eduard Andrić, president of the Croatian Tourism and Services Union (STUH), recalled that Croatia adopted the Sustainable Tourism Development Strategy until 2030, which assumes that there will be no concrete construction of the coast. He will say that there is still room for the construction of a hotel, but that the quality of the existing ones should be raised before new construction.
Where are the boundaries?
– The problem in this whole story is the workers. The fact is that we already do not have enough labor and that, in a certain number of years to come, we will have to face the fact that we are trying to interest our population and employ them in these hotels. Our need for foreign workers is growing, however, I believe that everyone understands that we cannot base a quality tourist season on them. I agree that we will need additional employment in tourism. However, it will be bad if the ratio of domestic and foreign workers continues to increase in favor of foreigners, Andrić pointed out. He also stated that part of the solution lies in the retraining of domestic workers, and even in the sense that surplus workers from the public sector are retrained and employed in tourism.
– However, the growth of these needs must also have some limits, just as we need limits in tourism construction. So, in my opinion, this growth in the need for workers in tourism will continue to increase for several more years, but it should stop at some point because it is no longer sustainable tourism, Andrić added.
Regarding the share of tourism in Croatian GDP, the CBS recently published a new Tourism Satellite Account, according to which in 2022 the direct gross domestic product of tourism amounted to 8.2 billion euros, or 62 billion kuna, and its share in the total gross domestic product was 12.18 percent. For comparison, the direct gross domestic product of tourism in 2019 amounted to around 49 billion kuna, or a share of 11.82 percent. Therefore, Croatian tourism has strengthened its share in the national GDP in these three years, regardless of the pandemic.
Neven Ivandić, a scientist at the Institute of Tourism in Zagreb, explained these data, pointing out that they do not include the indirect contribution of tourism to the economy, which is clearly larger. The direct contribution refers only to the direct encounter between visitors and those providing services in tourism, that is, the encounter between supply and demand. However, tourism consumption also stimulates other consumption, so the total contribution of tourism is significantly higher and shows how much tourism is a driver of the economy in a country.
Lack of plan
– In our country, this share is undoubtedly higher than in many other European countries, but other countries with a developed tourism sector also have a large share of tourism. The bottom line is that in Croatia, in addition to tourism, we need to develop other activities. We want higher income from tourism, but at the same time, the share of tourism in GDP is falling, which means that other sectors in our country are growing faster. This will also benefit tourism, because the coverage of all indirect effects will be better, and the quality of products will also improve, explained Ivandić.
Economist Ljubo Jurčić, on the other hand, speaking about the contribution of tourism to Croatia’s GDP, said that tourism has a relatively high share in GDP because the industry, he points out, has been ruined.
– This does not mean that tourism in Croatia is as developed as we would like. We know, in fact, that in this sense we have reached a “dead end” because tourism has not been developed according to plan. Namely, the tourism management plan should start from the Croatian spatial management plan, and since Croatia did not have a plan, this part was left to local communities that look at the short term, and within their own spatial boundaries. Unfortunately, we have not created the conditions for tourism with higher added value. Back in the 90s, we were saying that the share of hotel accommodation should be increased because it brings in more revenue, but in the meantime that share has decreased, said Jurčić.
Due to large imports, the share is actually smaller
Tourism developed spontaneously because there was no strategy to preserve and develop Croatian industry, and unfortunately there was no real strategy to develop tourism, Ljubo Jurčić pointed out. He also said that the gross contribution of tourism to GDP includes the depreciation of buildings, but also that less and less domestic production is included in the current tourist consumption of food, drinks and other things.
– Therefore, in my estimation, the real contribution of tourism to Croatian GDP is 50 percent less than the statistical data, that is, some 5-6 percent. For example, we know that we import over 50 percent of meat. This means that tourists here also eat that much foreign meat. Croatia imports 70 percent of milk, which means that even the milk that is offered is mostly not Croatian, concludes Jurčić.
