The analysis also shows that the increase in air transport growth doesn’t necessarily translate into better wages for workers. In fact, nations with the highest volumes of air tourist arrivals, like Italy, Spain and France have performed the worst when it comes to real-terms wages for tourism sector workers, leaving local hospitality workers with falling pay while facing rising living costs.
At the same time, large businesses are capturing a growing share of the money tourists spend on accommodation in Spain, France, Greece and Italy. Yet, local tourism workers aren’t seeing any benefits in their salaries.
“So often when airports expand, local communities are promised a wealth of economic benefits, but what we’re seeing in the data challenges this assumption. Jobs have been created, but the low wages they offer are poor compensation for rising housing costs, stretched infrastructure and increasing pollution,” Dr. Alex Chapman, Head of Economic Policy at the New Economics Foundation, said.
Dr. Chapman continued, “These impacts are also damaging to the wider economy. Our analysis shows that investment in non-tourism businesses falls as investors opt for property accumulation instead. This leaves workers trapped by their housing costs, unable to move to better work or invest in their skills.”
Furthermore, higher property prices can reduce business investment in the wider economy. The study suggests that over the 2019-2031 period, business investment can be expected to fall most sharply in Greece, Portugal, Spain and Italy. The largest losses in absolute terms hit Italy and Spain, which lose €1.1bn and €1.0bn in annual investment respectively. This happens as higher prices incentivise investors to direct capital towards property rather than towards productive and innovative sectors, such as transport equipment i.e. electric vehicles or trains, and information technologies.
With emissions from tourist flights arriving in Europe projected to continue to rise, T&E recommends that the upcoming EU Sustainable Tourism Strategy contain steps to:
