The hospitality industry makes a major contribution to the UK economy. It is a fact that the hospitality business employs a large percentage of people. This paper further focuses on economic impact. It will be covered what is the main reasons affecting demand. It will be analyzed about the global recession problem and how the recession has been impacted on people. Below in the essay will be covered how The Titanic anniversary and The Olympics Games increase The United Kingdom economy. The purpose of this essay is to examine and give practical examples related with the hospitality industry.
First of all, the main important factors are that demand is affected by the level of income andinflation in hospitality business. Inflation has affected every industry in theUK and especially hospitality and tourism. According to Anon a. (2012)”inflationis a rise in the general level of prices of goods and services in an economyover a period of time. When the general price level rises, each unit ofcurrency buys fewer goods and services”. The biggest issue of theinflation is that the prices are growing up, but the salary is not rose up.
Prices increasing have caused a decrease on consumers travelling as much asthey usually would like. Furthermore, it is a fact that people spend less moneyon travelling abroad and staying over in a luxury hotel. It is getting more andmore popular to make holidays at home, as it is the cheapest an availableoption. Many hotels compete with each other doing special offers to sell roomsfor the local residents. Also regular customers have even reduced their spendingmoney on travelling and staying in hotels.
We will cover another one a negativefactor that quite period in hotels lead to reduce staff. During recession everyindustry has to reduce personnel due to fear of going into liquidation ofbusiness. Another one the biggest a global problem in the world is recession. Recession is a period of temporary economic decline during which business activity are reduced. Jobs are on the fall everyday. The recession has impacted on every industry in UK, especially hotels and tourism business, as people primarily reject travelling if they do not have money.
Many people are affected by recession and as a result they lose jobs. Furthermore, the government should support the hospitality industry in order to reduce financial difficulties inthe country. Moreover, the government has to help in reducing taxes in this wayit is aim to survive hotels. Due to crisis situation the banks stoppedproviding loans for people. The government should not increase taxes and anyother charges in order to keep the hospitality industry in good economicsituation.
Next, there is no doubtthat London the Olympic games in 2012 is a major event in the world. “Let us take theexample of a destination such as London, which attracts a high volume ofoverseas visitors. The flow of those visitors will be affected by a great manydifferent factors. For example, if tourists can purchase more pounds sterlingfor their own currency or air fares to the destination have fallen or a majorevent, such as an international sports event – The Olympics – is beingorganized – all these factors will encourage tourist to visit the city” (2009 p.
92). At that moment many people are travelling to London from all over the world inthis way they will increase the economy but it will last only for the Olympic Gamesperiod. It is a great chance for economic increasing during the games asbooking of the rooms are dramatically rose and follow by this the prices alsoare increased. So, every industry will be affected and staff is recruitedduring the games period. Moreover, in the hospitality industry after theOlympics games will be an economic recession and many employees will lose jobs.
So it can found positives and negatives aspects from economic side. It is afact that the games grow up the level of tourists in London. By the way,Northern Ireland is also involved in Olympics and in the end of July in NI willbe events related with the games. Furthermore, the whole UK economy is affectedby the games and it makes a huge profit for the hospitality industry. In Northern Ireland isvery remunerative year as it was commemoration one hundred year of the sinkingof the Titanic ship. In March and April it was opening of the new Titanicbuilding – Titanic Quarter.
Millions pounds were invested into the titanicbuilding. This international public event attracts many tourists. Furthermore,Belfast city was involved in the event; it was many festivals and exhibitions. Moreover, the whole hospitality industries eager for increasing the budge ofhotels so they were trying to incorporate hotels also in this special event. For example the merchant hotel was also involved in this prominent event, asthe hotel was decorated like the titanic ship. The Bar staff got new uniformsfor this period being more involved in the event.
So the hotel attracted a lotof tourists from all over the world. It is a fact that the prices grew up forthe Titanic anniversary. The general manager of the merchant hotel Adrian McLaughlinsaid that “the revenue was surprisingly very high he mentioned that theydid not expect so many tourists in the hotel”. So, the internationalTitanic event increased Northern Ireland an economic situation, but after theTitanic festival for couple of weeks it was a collapse in the hotel, so employees’hours were cut.
Over all it is a factthat during recession period everybody has to be involved in a saving process. So, the biggest factor is income which affects people to save money and tospend money only on priority things. These days a lot of group of people rejectto travel somewhere abroad because of having financial difficulties. There isno doubt that there is still a long way to go until the recession is over. Millions of businesses throughout the world are in bad current economic climate.