According to a research published by the Bangladesh Institute of Development Studies (BIDS), Tk59,990 crore was lost in gross value added in the Hospitality and Tourism Sector (HTS) of Bangladesh due to the Covid-19 pandemic.
While the HTS would have contributed about Tk1,50,000 crore in terms of gross value added in absence of the pandemic, the contribution was reduced to around Tk 90,100 crore.
Transport, restaurants, hotels and resorts accounted for 40%, 29% and 25% of the loss in gross value added respectively.
According to a research titled “The Covid-19 pandemic and the Hospitality and Tourism Sector in Bangladesh”, about 141,000 workers in the sector lost their jobs during the period.
This is the first such research on the tourism sector done in Bangladesh; however, this research has been completed with only seven sub-sectors of tourism.
While presenting the research keynote paper Mohammad Yunus, senior research fellow BIDS said: “The findings from the survey show that the sales and revenues in HTS dropped significantly in the second (April-June) quarter in 2020 compared to that of 2019.”
“The fall was about 84% for hotels and resorts and 98% to 100% for tour operators and travel agents and amusement parks. Most of the enterprises started to show improvement in sales revenue from the third quarter (July–September) which improved further in the fourth quarter (October–December) of 2021.”
“The average number of workers hired by the hotels and resorts was 42% lower during the pandemic period compared to the pre-pandemic year. The retrenchment, on the other hand, was 317% higher during the same period,” he added.
Responding to a question at the research reveal seminar, chief guest Jabed Ahmed, chief executive officer (Additional Secretary), Bangladesh Tourism Board said: “Inbound tourism serves as a backbone for tourism in any country but it's not been added in this research, so, we can't say how much this loss actually is.”
“However, it should be kept in mind that this is the first such work in the tourism sector, moreover, during the time of Covid-19, we had many kinds of limitations,” he added.
According to the paper, there was hardly any hiring and retrenchment by the travel agencies, tour operators, and tourism SMEs, neither in 2019 nor in 2020.
The average reduction in wages and salaries is quite substantial among the hotels and resorts at 34%, tour operators at 34%, and travel agents with 26%.
In comparison, benefits were reduced by about 50% for employees in these sub-sectors.
The study also attempted to understand the economic well-being of workers employed in hotels and resorts as well as tour agencies. The percentage of employees reporting a decrease in earnings is sizable among tour operators and travel agencies with 72% reduction and the tour guides as well as hotels and resorts with a 50% reduction during the second quarter of the year when the strict lockdown was in effect.
The situation remained almost the same during the third quarter except for employees working in hotels and resorts who reported a 45% reduction in that quarter.
The major coping mechanisms adopted by the enterprises were temporarily shutting down the business, reducing wages and salaries and other benefits and laying off employees during the strict lockdown.
According to the report, the reduction of non-labour maintenance costs is another key mechanism through which a considerable number of hotels and resorts, tourism SMEs, transport agencies, and amusement parks coped with the adversity.
Chairperson of the seminar Binayak Sen, director-general, BIDS said: "Recently we have seen how the tourism-dependent Sri Lankan economy is collapsing, but hopefully, our economy is not dependent on tourism either.”
BIDS conducted a primary survey with enterprises and employees drawn from 200 hotels and resorts (categorized as 5-star, 4-star, 3-star, 2-star), 138 travel agencies and tour operators, 200 restaurants and 63 tourism SMEs across the eight administrative divisional cities.
Apart from the quantitative surveys, case studies involving 21 transport owners and operators, and owners and employees of seven tourist attractions and recreational centres (amusement parks) were also conducted.
