1. The Canadian Provincial & Territorial Tourism Satellite Accounts: A Research Odyssey IBGE 2nd National Meeting of Producers and Users of Social Economical and Territorial Information Rio de Janeiro, Brazil; August 23, 2006 Presented by: Scott Meis UNWTO Consultant Aided by: Chris Jackson & Jacques Deslisle Statistics Canada

2. OVERVIEW  Context and justification  Concepts and definitions  Methodology  Results & findings  Conclusions & future work

3. CANADA 10 Provinces 3 Regions Yukon British Colombia North West Territories Nunavut AlbertaManitoba Saskatchewan Ontario Quebec Newfoundland Labrador Nova Scotia New Brunswick Prince Edward Isle.

4. TECHNICAL PARTNERSHIP  Statistics Canada & Canadian Tourism Commission  Objective independent statistics agency  Industry champion, resources, uses  Shared goals and objectives  Interdependence  Mutual respect & understanding STC-CTC Technical Partnership -1989-2006

5. CTC: Creation (1995)--Legislation, Jan,2001 CTC MISSION  Market & brand Canada as a tourism destination  Provide accurate and timely information  Aid government and industry decision making MANTRA  Industry lead, market driven, research based

6. Tourism Satellite Account  An account, not a model  Set of statistics measuring structure and scope of tourism outputs, expenditures and employment  Measure monetary values of commercial transactions  Integrates visitor demand data with supply data from a dispersed set of industries  Separate linked extension of SNA  Tourism specific summary comparable with other industries and total economy History: A New Statistical Instrument

7. HISTORY OF TSA  Concept of tourism satellite accounts, France 1979  Canadian TSA recommendations, 1989  TSA principles and guildelines, Ottawa Conference, 1991  Release of 1 st Canadian TSA, 1994  WTO/OECD international standard projects, 1996-1999  Quarterly national tourism indicators, 1996  Adoption by UNSC of TSA international standard, 2000  Release of TSA:RMF, Vancouver, 2001  Release of 1 st Provincial/Territorial TSA for Canada, 2002 TSA History:

8. PTTSA History:  Provincial Responses to NTSA-NTI, 1994-1999  PTSA Feasibility study proposals (Québec/CTC/STC) 1995  Feasibility study of provincial dimension to NTSA 1997-1998  Development proposal, partnership and contract discussions Alberta/Québec/CTC/STC) 1999-2001  Project initiation, 1999-2000  Project completion, April, 2002  Revised & updated 2 nd PTSA Benchmark update, June, 2003 PTSA History

9. WHY A PROVINCIAL/TERRITORIAL TSA?  Tourism unevenly distributed  Shared federal-provincial responsaibility  NTFD findings re regional data  Regional interest stimulated by CTSA release  Improve credibility and consistency of tourism economic measurement –Common conceptual framework -- the System of National Accounts. –Comparbility within & between provinces, with national economy & economic sectors  Strengthen capacities for tourism analysis and research PTTSA Rationale:

10. PTTSA: Design Decisions  Concepts and methods from national accounts and TSA  Reference year - 1996  Estimates cover all provinces and territories  Level of detail: 2 digit industries and commodities Feasibility Study Decisions

11. List of 2 digit (“S” level) industries (NAICS 97)  Goods Producing Industries Agriculture, Fishing & Trapping, Logging & Forestry Mining, Manufacturing, Construction, Utilities PTTSA – Design Decisions  Services Producing Industries Transportation & Storage, Communications, Wholesale Trade, Retail Trade, Finance & Insurance, Real Estate, Business Services, Government Services, Education, Health & Social Services, Accommodation, Food & Beverage, Other Services

12. PTTSA - Methodology: LIST OF “S” TOURISM COMMODITIES LIST OF “S” TOURISM COMMODITIES  Passenger Transportation:  Passenger air transportation  Private vehicles: Vehicle fuel, repairs and parts.  Others: Water, rail, bus, taxis, vehicle rental  Accommodation: Motels, hotels, camping grounds, outfitters and other accommodation  Food and Beverage Services: Meals, alcoholic beverages  Other Tourism commodities: Recreation and entertainment, travel agency services and pre-trip expenses  Other Non-tourism Commodities Purchased by Visitors: Groceries, alcoholic beverages purchased from stores, souvenirs, urban transit, parking and other services and commodities

13. PTTSA - Methodology: LIST OF “S” TOURISM INDUSTRIES LIST OF “S” TOURISM INDUSTRIES  Transportation: Air, water, rail, bus, taxis, vehicle rental and vehicle fuel, urban transit, parking.  Accommodation: Motels, hotels, camping grounds, outfitters and other accommodation.  Food and Beverage Services  Other Tourism Industries: Includes recreation and entertainment services, travel agencies and tour operators.  Other Industries: Includes non-tourism industries benefiting from tourism, e.g. retail, by providing commodities bought by visitors including groceries, alcoholic beverages, motor vehicle fuel, parts and repairs, pre-trip expenses, toiletries, etc.

14. CONCEPTS  The provincial/territorial TSA (PTTSA) is based on the accounting principles of the System of National Accounts (SNA)  Tourism is not and activity identified in the SNA  Consequently, construction of the PTTSA necessitates the division of the relevant SNA economic activities into their tourism and non-tourism components PTTSA - Methodology:

15. DEFINITION  Tourism is defined as « the activities of persons traveling away from their usual environment, for a period less than 12 consecutive months for the purposes of leisure, business or other purposes» (UNWTO)  « Usual environment » operationalized as: –Trips greater than 80 kilomètres from one’s residence (one direction) –SAME definition of tourism applies to all provinces & regions  SAME tourism commodities and industries for all provinces & regions of Canada PTTSA - Methodology:

16. DATA SOURCES  Tourism supply, GDP and employment –Provincial input-output accounts (1990) –GDP by industry accounts –Business surveys –Administrative records –Labour productivity data base  Tourism demand –Canadian Travel Survey –International Travel Survey –Survey of Income and Expenditures  Reference years 1996 and 1998 chosen based on the optimal availability of all these data sources PTTSA - Methodology :

17. METHODOLOGY  Goal of the PTTSA - to measure tourism economic activity in terms of tourism supply, tourism demand, tourism GDP and tourism employment  Estimates MUST be calculated in the following order PTTSA - Methodology:

18. TOURISM SUPPLY – METHODOLOGY  Tourism domestic supply = total production of tourism commodities and services in Canada  Total tourism supply NOT equivalent to total tourism demand  Essential to FIRST correctly specify and calculate total tourism supply PTTSA - Methodology :

19. TOURISM SUPPLY – CALCULATION Break down I/O « S » level industries into component sub-industies Discern and keep only those sub-industries that serve visitors directly Example: F&B industry splits-- restaurants, bars, take-out restaurants and caterers; Drop caterers Split out and remove industry supply not linked to tourism commodities, (consumed direcly by visitors) e.g. caterers – keeps meals but drops royalties Calculate total tourism supply all tourism commodities of each industry/sub-industry PTTSA - Methodology :

20. DEMAND – METHODOLOGY  Tourism demand is defined as the total expenditures of « visitors »-- including both tourists and excursionists  Components of total tourism demand –Domestic (intraregional) demand –International demand –Interregional demand (new aggregate) PTTSA - Methodology:

21. Demand – Methodology  Demand comes from survey data: –Canadian Travel Survey (CTS) (renamed Travel Survey of Resident Canadians) for domestic demand –International Travel Survey (ITS) for international demand  Many iterative adjustments & calculations are made to reconcile demand with supply –Pre-trip expenses –Domestic fares of international trips of Canadians –Other non-measured demand (ex. tips) –Domestic tourism for territorial residents (Source:SHE) –Balancing of demand with supply PTTSA - Methodology:

22. Demand Surveys Input Output System Supply Surveys System of National Accounts Labour Force Survey Other Information Such as Manufacturing data International Trade data Tax information Business information Such as Profits, capital investment, revenues, expenses Survey of Employment, Payroll and Hours All Other Areas of System of National Accounts Reconciliation Processes Canadian Tourism Satellite Account

23.  Commodities expenditures VS industry revenues  Tourism demand VS supply by commodity  Tourism inputs VS outputs by industry  Gross outputs VS all inputs  Repeats all of the above at each geographical level  Iterative & interactive process -- “requiring high degrees of professional judgment” PTTSA Methodology: Reconciliation BALANCING SUPPLY WITH DEMAND

24. LINKAGE BETWEEN COMMODITIES & INDUSTRIES  Demand is estimated for groups of goods and services (commodities)  GDP and employment, however, must be calculated by industry  Supply can be calculated either for groups of commodities or by industry/sub-industry categories which establishes the link between demand and GDP  The link is a demand/supply ratio for each commodity  This ratio is then applied to each industry category to calculate GDP and employment in the industry space PTTSA Methodology:

25. TOURISM GDP - METHODOLOGY  Tourism GDP can be defined as a simple value of domestic production of tourism goods and services within the limits of a particular region  Only direct GDP is measured as opposed to indirect GDP and induced GDP  Componants of GDP include: –Labour income, i.e. salaries and wages –Supplementary work-related income –Mixed revenue –Other operating surplus -- profits & depreciation PTTSA Methodology:

26. Proportion of Tourism GDP by Industry Category Source: Statistics Canada (1996 PTSA and 2001NTI) %TS/TVA

27. TOURISM EMPLOYMENT  Tourism employment is the sum of all employees who contribute to tourism production:  Includes all direct employment: –Indirect employment and induced employment are not included –Includes self-employed workers and non-renumberated family workers –Seasonal full-time and part-time employment are both included but they are not calculated as full-time equivalents  Same industrial ratios as Tourism GDP used to calculate the tourism employment portion of each sub-industry/industry PTTSA Methodology:

28. Tourism Employment (T) Total employment in all industries (A+B) Employment related to tourism industries A= Employment of tourism industries generated by other users (local & non-visitor consumption) B= Employment of tourism industries generated by consumption of visitors (B+C) = Total employment generated by tourism consumption C= Part of employment in non-tourism industries but generated by visitor consumption (T) (A) (B) (C)

29. PROVINCIAL/TERRITORIAL RESULTS  Tourism expenditures  GDP/Employment proportions  Sources of demand  Trade balances PTTSA Results:

30. Provincial Distribution (%) of Tourism Expenditures (1996) Source: Statistics Canada (1996 PTSA)) PTTSA Results:

31. Provincial Tourism Satellite Account, 1996 Tourism GDP / total GDP Employment in tourism / total employment Yukon 4.88.1 British Columbia 3.54.7 Prince Édward Isle. 3.14.6 Nova Scotia 2.64.1 Newfoundland/Labrador 2.33.9 Manitoba 2.33.2 Canada, 1996 2.33.7 Québec 2.23.3 Alberta 2.23.9 Ontario 2.13.5 NWTerritoires/Nunavut 2.14.3 New Brunswick 2.03.6 Saskatchewan 1.83.3 (percentage)

32. Provincial Distribution of Tourism GDP Shares (1996) Canada (1998) 2.3 % Source: Statistics Canada (1996 PTSA and 2001NTI) PTTSA Results:

33. SOURCES OF TOURISM DEMAND, PROPORTIONS, 1996 International Demand (percentage) Yukon 62.717.020.2 British Colombia 39.138.322.6 Ontario 38.148.113.8 Canada, 1996 32.847.220.0 Prince Edward Island 30.815.753.5 Québec 28.852.918.3 Alberta 28.047.624.4 Nova Scotia 24.642.932.5 New Brunswick 21.843.534.7 NW Territoires/Nunavut 19.642.038.4 Manitoba 16.349.134.6 Newfoundland/Labrador 15.356.028.7 Saskatchewan 9.462.628.0 Domestic iDemand Interregional Demand

34. Intraregional demande = the largest part of tourism $ Interregional demand = new aggregate indicator Intraregional demande = the largest part of tourism $ Interregional demand = new aggregate indicator $54.6 Billion (2001) % SOURCES OF TOURISM DEMAND, 1996 PTTSA Results:

35. REGIONAL TOURISM TRADE BALANCES, 1996 Total balance of tourism trade (millions de dollars, Canadian) British Colombia 202430-228 Prince Édward Isle. 834835 Yukon 60456 Nova Scotia 5056-6 Newfoundland/Labrador 25-227 NW Territoires/Nunavut 21912 New Brunswick -15014-164 Alberta -406-63-344 Saskatchewan -426-128-298 Manitoba -484-66-418 Québec -77663-839 Ontario -2958-366-2592 Canada, 1996 -47590 Interregional balance of tourism trade International balance of tourism trade

36. FINDINGS  Importance of tourism in terms of GDP and employment varies significantly from one province/territory to another  Provinces/territories ranking highest are those who depend more on international and interprovincial sources of tourism demand  Tourism plays a relatively more siginficant role in some of the smallest regional economies  Generally, the same regions also have a favourable tourism balance of trade PTTSA Findings:

37. PTSA Challenges:  Geographic vs commodity aggregation  Detailed results vs confidentiality  Reconciliation of data on supply with demand  Questions and lack confidence in the quality of estimates for small regional samples and industries  Comparability with previous provincial estimates from economic models  Comparability with other existing provincial/regional data sources  Financial participation of ALL provincial/regional partners  Communications, communications, communications…!  Politics, politics, politics, politics…! CHALLENGES

38. PTSA: Future Vision  Provincial Tourism Indicators  Provincial & Local Impact Models  Provincial Human Resources Module  International regional comparisons POSSIBLE FUTURE DEVELOPMENTS

39. CONCLUSIONS  PTSA is technically feasible  Foundation for further developments  Potential to develop comparable cross- border accounts  Main challenges: data quality & consistency, communications and politics-- meeting information needs vs biggest number syndrome PTSA: Conclusions:

40. THANK YOU FOR YOUR ATTENTION! WEB: www.smmra.com E-Mail: smeis@rogers.com