Dr Ade Oriade

Faculty of Social Sciences

Ade Oriade is a senior lecturer in Tourism Management, Faculty of Social Sciences, University of Wolverhampton. Apart from academic roles, Ade is involved in a number of travel and tourism consultancy projects such as Economic impact assessment of Lichfield Cathedral and First Rate’s Holiday Confidence Index. His work continues to contribute to policy/decision making in the industry and socio-economic development of destinations.

Ade completed his PhD in Tourism and Services Management from University of Salford. His PhD work focused on conceptualisation of perceived quality and its relationship with other service constructs such as satisfaction, value, equity and behavioural intentions. Ade’s main research areas are in services management in tourism/hospitality/event and sustainable tourism development and planning.

Does economic recovery influence UK holidaymakers' intentions to travel abroad?

Executive Summary

Introduction

The global economic crisis experienced recently has been documented as one of the most severe economic crises ever experienced. While growth is gradually returning to some countries, others are yet to record any recovery. No doubt understanding consumer behaviour and attitude towards travel during crisis (Sheldon and Dwyer, 2010) and consequently recovery (Sonmez, Apostolopoulos and Tarlow, 1999) is important for planning and managing tourism. Within this context a number of studies have investigated effect of economic crisis at both macroeconomic (Smeral, 2010; Papatheodorou, Rossello and Xiao, 2010 and) and microeconomic levels (Bronner and de Hoog, 2012; Alegre, Mateo & Pou, 2013; Bronner and de Hoog, 2014; Eugenio-Martin and Campos-Soria, 2014 and Campos-Soria et al., 2015). Others have explored political crisis (Sonmez et al., 1999, Feridun, 2011) and crisis relating to natural disaster (Biggs et al., 2012 and Yuan, Faming and Jianping, 2012) or both in one study (e.g. Page, Song and Wu, 2012).

To certain extent effect of recovery have been examined (e.g. Sonmez et al., 1999; Yuan, Faming and Jianping, 2012) however most of these have been in the area of political crisis and natural disaster, and the recovery of the tourism industry.  Campbell and Converse (1972) pointed out that whilst the US national income increased at the time of their investigation, people did not observe an improvement in their socioeconomic status. Stokes (2001) argued that a comprehensive account of the crisis, and consequently recovery, can be mapped only when individuals’ perception of economic life are considered. It is clear that economic crisis impact adversely on overseas holiday demand; however, going by the recovery UK economy has made the question is - does this recovery drive outbound tourism demand?

Aims & objectives

Given the economic growth witnessed in the UK, this study explores the effect of the recent economic crisis on UK outbound tourism and investigates how confidence in the recovery of the economy shapes travel intentions.

Methods

Data were collected through a nationwide online survey using a sample of 5,136 UK citizens and analysed using structural equation modelling. In order to predict travel intention, three key interacting constructs – attitude to travel, confidence in economy and travel economising strategy were examined.

Research design

Attitude to travel was measured by three items (plan and book holiday in advance, take holiday due to bad weather and reduce spending in order to go on holiday). Confidence in economy was estimated by three items (UK economy will improve, meeting financial obligation and improved personal and household finances). Travel economising strategy was evaluated by five items (travel booking cost, holiday money number of holiday, holiday duration and spending at destination) based on Bronner and de Hoog 2012, 2014; Campos-Soria et al., 2015. The questionnaire items for Travel economising strategy were framed in a five point nominal scale. For Attitude to travel and Confidence in economy, responses were elicited using a five point Likert scale ranging from Strongly Disagree (1) to Strongly Agree (5). Travel intention was measure by a single, binary response item asking respondent to choose either a Yes or a No if they plan to take any holidays abroad over the coming 12 months.

In order to investigates the attitude of UK citizens towards overseas travel in time of economic recovery as well as explore whether economising strategies continue to influence overseas holiday intentions an adapted TRA was adopted and the under-listed hypotheses were formulated and tested.

• H1: Attitude towards overseas travel influences intention to take overseas holiday
• H2: Confidence in the economy influences intention to take overseas holiday
• H3: Attitude towards overseas travel has a positive relationship with Confidence in the economy
• H4: Confidence in the economy mediate the influences of attitude on intention to take overseas holiday
• H5: confidence in economy is negatively related to economising strategy 
• H6: Economising strategy is negatively related to travel intentions

Summary of findings

The findings in the study confirm that international tourism is a resilient business.

The path coefficient between attitude and confidence in economy indicates a strong relationship. Confidence in economic recovery significantly influences intentions to take overseas holiday. It was also found that confidence in economy mediates the path between attitude and intention. Negative relationships were confirmed between confidence in economy and economising strategy, and economising strategy and intention indicating that the more people will have to adopt travel economizing strategy the less they are likely to travel.

The study advances theoretical understanding of tourists’ behaviour during economic recovery period.  The findings indicate that the industry will benefit if marketers should emphasize economic recovery in their campaign. Another implication implicit in the work is for managers to formulate campaigns and strategies that support attitude change.

References

Alegre, J., Mateo, S., & Pou, L. (2013). Tourism participation and expenditure by Spanish households: the effects of the economic crisis and unemployment. Tourism Management, 39, 37-49.

Biggs, D., Hall, C. M., & Stoeckl, N. (2012). The resilience of formal and informal tourism enterprises to disasters: reef tourism in Phuket, Thailand. Journal of Sustainable Tourism, 20(5), 645-665.

Bronner F., & de Hoog, R. (2012). Economizing strategies during an economic crisis, Annals of Tourism Research, 39 (2), 1048–1069.

Bronner, F., & de Hoog, R. (2014). Vacationers and the economic “double dip” in Europe. Tourism management, 40,330-337.

Campbell, A., & Converse, P. E. (1972). Social change and human change in Campbell, A., & Converse, P. E. (Eds.) The human meaning of social change. Russell Sage Foundation.

Campos-Soria, J. A., Inchausti-Sintes, F., & Eugenio-Martin, J. L. (2015). Understanding tourists' economizing strategies during the global economic crisis. Tourism Management, 48, 164-173.

Eugenio-Martin, J. L., & Campos-Soria, J. A. (2014). Economic crisis and tourism expenditure cutback decision. Annals of Tourism Research, 44, 53-73.

Feridun, M. (2011). Impact of terrorism on tourism in Turkey: empirical evidence from Turkey. Applied Economics, 43(24), 3349-3354.

Page, S., Song, H., & Wu, D. C. (2012). Assessing the impact of the global economic crisis and swine flu on inbound economic crisis in the United Kingdom. Journal of Travel Research, 51(2), 142-153.

Papatheodorou, A., Rosselló, J., & Xiao, H. (2010). Global economic crisis and tourism: consequences and perspectives. Journal of Travel Research, 49(1), 39-45.

Sheldon, P., & Dwyer, L. (2010). The global financial crisis and tourism: perspectives of the academy. Journal of Travel Research, 49(1), 3-4.

Smeral, E. (2009). The impact of the financial and economic crisis on European tourism. Journal of Travel Research, 48(1), 3-13.

Smeral, E. (2010). Impacts of the World recession and economic crisis on tourism: forecasts and potential risks. Journal of Travel Research, 49(1), 31-38.

Sönmez, S. F., Apostolopoulos, Y., & Tarlow, P. (1999). Tourism in crisis: Managing the effects of terrorism. Journal of Travel Research, 38(1), 13-18.

Yuan, W. X., Faming, S., & Jianping, S. (2012). Study on the Difficulties Facing the Tourism Industry during Mianzhu Economic Recovery after the Earthquake. In Education and Educational Technology (pp. 431-435). Springer Berlin Heidelberg.