Tourism sector optimistic in the face of headwinds

In recognition of National Tourism Week, April 15 to 19 – a time to celebrate and promote the immense contributions of the sector across the country – the Calgary Chamber of Commerce has examined recent results of the Q1 Canadian Survey on Business Conditions, carried out by Statistics Canada in partnership with the Canadian Chamber of Commerce. Our analysis found that despite persistent labour and cost-related challenges facing the sector, there remains a growing optimism for the future of the industry.

"In recognition of National Tourism Week, we acknowledge the significant contribution of tourism and hospitality to Canada’s economy, generating over $3 billion in GDP for Calgary’s economy” says Deborah Yedlin, President and CEO at the Calgary Chamber of Commerce. “It's clear that these industries are not just about leisure and travel – they are key economic drivers that stimulate local businesses, create jobs, and contribute to our GDP and our diversified economic future."

“Calgary is in an enviable position right now as a city,” says Cindy Ady, CEO of Tourism Calgary. “From our ability to attract and host major sporting events, to the new opportunities for more and larger conventions in our city with the BMO Centre opening, and the many developments our city has seen and will continue to see in the years ahead, such as the new Events Centre – tourism is on an upward trajectory. We look forward to harnessing the many opportunities ahead together with our tourism partners.”

The accommodation and food services industry, as well as the arts, entertainment and recreation sectors, have expressed an increased sense of optimism totaling 64 per cent – up 11 per cent compared to the same quarter last year, and continuing the trend of quarter-over-quarter growth since 2022. Rising optimism levels are largely attributed to higher and more stable revenues, an increase in consumer demand, and a lower impact of rising interest rates.

86 per cent of business report revenue growth

Easing revenue concerns

With revenues on the rise, concern related to attracting and retaining customers has fallen. Both the arts, entertainment and recreation businesses (down 3%) and the accommodations and food services sector (down 13%) have seen an improvement since Q1 2023. This growing consumer base is largely the result of rising population growth, with Alberta witnessing the largest increase relative to any other province across the country last year.

Persisting labour shortage

Despite rising optimism levels, challenges remain. The accommodation sector, in particular, is feeling the labour pinch, with over 80 per cent of businesses reporting challenges with labour shortages and retaining skilled employees. Of the labour-related obstacles impacting the industry, retaining skilled employees remains the most difficult challenges ahead. This comes at a time when over 21 per cent of businesses in the sector anticipate a need to not only retain talent, but to increase their overall number of employees over the next three months to support their business.

Ongoing higher costs

Increased costs are also weighing on the industry with over 92 per cent of businesses stating general cost-related obstacles as a top concern. These include rising input costs, inflation concerns and debt costs. Encouragingly, there has been a notable decrease in the proportion of businesses experiencing concerns related to real estate, leasing and property taxes (36%) compared to Q1 2023 (40%). With the City approving a non-residential tax shift last budget to support business, the decrease is evidently a welcome relief for businesses across the sector.

Cost-related obstacles top-of-mind for businesses

Our Recommendations

To capitalize on rising optimism and to mitigate the challenges ahead, we call on all three levels of government to:

• Initiate additional awareness campaigns highlighting the benefits of working in the sector and showcasing the exciting and diverse career opportunities available.
• Advance tourism and hospitality related immigration programs, including Alberta’s Tourism and Hospitality Stream of the Alberta Advantage Immigration Program, to ensure the sector has a sustainable talent pipeline.  
• Make additional investments in infrastructure that enhances Calgary’s appeal to tourists, such as improved transportation options and development of new cultural attractions.
• Bolster collaboration between academic institutions, industry stakeholders and businesses to develop training programs tailored to the needs of the tourism and hospitality sector.
• Ensure Calgary showcases its diverse cultural communities year-round to maximise Calgary's tourism potential.

About the Calgary Chamber

The Calgary Chamber exists to help businesses thrive. As the convenor and catalyst for a vibrant, inclusive and prosperous business community, the Chamber works to build strength and resilience among its members and position Calgary as a magnet for talent, diversification and opportunity. As an independent, non-profit, non-partisan organization, we have built on our 131-year history to serve and advocate for businesses of all sizes, in all sectors and across the city.

Media opportunities

For media inquiries, please contact us at media@calgarychamber.com.