Tourism generates substantial return on state investment
Industry provides more than 135,000 direct jobs as visitation and revenues continue upswing
BALTIMORE (Jan. 8) – The Maryland Office of Tourism Development (OTD), an agency of the Maryland Department of Business and Economic Development (DBED), announced that tourism in Maryland is on the rise, with a 4.6 percent increase in spending from visitors to the State in 2012. The Fiscal Year 2013 Tourism Development Annual Report highlights a variety of performance measures that evaluate the effectiveness of the State’s tourism efforts as well as the impact the travel and tourism industry has on Maryland’s economy.
“Tourism has been and continues to be a powerful economic engine for Maryland,” said Dominick E. Murray, Secretary, DBED. “More than 135,000 Marylanders were directly employed in the tourism industry in 2012, with a payroll of $4.5 billion. And the tourism industry not only creates and sustains jobs, it generates substantial tax revenue and business income.”
Maryland tourists and travelers spent $14.9 billion on travel expenses in 2012, based on The Economic Impact of Tourism in Maryland – Calendar Year 2012 Tourism Satellite Account conducted by Tourism Economics, an Oxford Economics company. Local transportation, food and beverage, and lodging each account for about 20 percent of visitor spending, followed by spending on retail, air and entertainment. Visitor spending has grown by more than four percent in each of the last three years.
While the results of a Tourism Satellite Account are only available on an annual retrospective basis, many performance metrics, including the Tourism Promotion Act sales tax codes, are available on a more frequent and timely basis. The Maryland Comptroller’s office reported that the formula utilized in the Tourism Promotion Act generated $381.4 million in Fiscal Year 2013, an increase of 1 percent from Fiscal Year 2012. Since Fiscal Year 2007, sales tax revenues attributable to tourism have grown 31.4 percent, far outperforming the 19.7 percent growth of overall sales tax collections.
“As a small business owner, I analyze every aspect of business with an eye toward return on investment,” commented Greg Shockley, chair of the Maryland Tourism Development Board and owner of Shenanigan’s Irish Pub in Ocean City. “The Board commissioned a leading market research firm to measure the recognition and effectiveness of OTD’s 2012 advertising placements. The study concluded that one dollar invested in OTD ads returned $160 dollars in visitor spending, more than $22 in State and local revenue, and nearly $5 in State sales tax revenue.”
The number of visitors traveling in the state has also been on the upswing. Maryland welcomed 35.4 million domestic visitors in 2012, an increase of 2.9 percent over 2011.
"The Annual Report is a testament to our strategic regional promotional efforts," said Margot Amelia, executive director of the Maryland Office of Tourism. “For the past several years, we have focused our marketing efforts on the key feeder markets of Washington, D.C., Philadelphia and Baltimore, including year-round communication through digital and traditional media, as well as consumer research to crystalize key messaging.”
Visitation in 2012 was 30 percent greater than 2007, when the state counted 27.2 million visitors. This 30 percent increase was substantially greater than the 9.2 percent increase in tourism across the nation and greater than the rate for other mid-Atlantic states.
About Maryland tourism
The Maryland Office of Tourism is an agency of the Division of Tourism, Film and the Arts within the Maryland Department of Business and Economic Development. Recently reported visitor data shows that the state welcomed more than 35.4 million visitors in 2012. In 2012, visitors spent $14.9 billion on travel-related expenses – generating more than $2 billion in state and local taxes and providing more than 135,000 jobs to Maryland residents with a payroll of $4.5 billion.