Hospo, accom spending plummets as lockdown keeps wallets shut

12th May 2020 By Staff Reporter | news@tourismticker.com | @tourismticker

Actual card spending on hospitality, monthly, April 2017 – April 2020. Source: Stats NZ

Travel agency and tour arrangement services spending fell to negative numbers for the first time since Stats NZ began collecting the data, says the department.

This was because the value of refunds received exceeded purchases during April, Stats NZ’s retail statistics manager Kathy Hicks said.

Seasonally adjusted spending on travel agency and tour arrangement services fell 82%, or $40m, in April 2020, following a 57%, or $64m, fall in March 2020.

Overall retail card spending across the country fell more than $2.6bn as non-essential businesses temporarily shut during the lockdown.

All industries showed unprecedented falls in April. Furniture, hardware, and appliances (durables) led the retail industry falls in value, down 72%, or $1bn, from March this year.

Hospitality sales, including accommodation, cafes, and restaurants, had the next largest fall, down 93% , or $721m.

“New Zealand was under the level 4 lockdown for all but the last three days of April. The impact of restrictions on the number of overseas visitors to New Zealand contributed greatly to the hospitality fall,” Hicks said.

“A small recovery in hospitality sales happened because people could buy takeaway food through contactless payment, when the country moved to level 3.”

The restrictions on non-essential travel for the month, as well as lower pump prices, saw spending on fuel drop 60%, or $291m, compared with March.

Card spending on hospitality also fell drastically in April.

“Spending on eating out and accommodation away from home was almost non-existent in April due to the Covid-19 lockdown,” Hicks said.

Spending on businesses including cafes, restaurants, takeaway food, and bars fell 95%, or $814m, compared with April 2019. This followed a 29%, or $266m, fall in March 2020 compared with March 2019.

Spending on businesses including motels, hotels, and other accommodation fell 94%, or $209m, compared with April 2019. This followed a 37%, or $97m, fall in March 2020 compared with March 2019.

The total retail decline of $2.6bn drop is the equivalent of each person in the country spending about $520 less in April than they did in March,” Hicks said.

“We can also see this reflected in much lower traffic volumes in the main centres and a fall in the supply of fuel during April.”