Austrian Tourism Thrives Despite Economic Challenges

Austrian Tourism Thrives Despite Economic Challenges

Image: Steiermark Tourismus/Herbert Raffalt

 

Austria’s tourism sector is enjoying a boom, recording 141 million overnight stays in 2024, the highest figure ever, despite ongoing economic uncertainties, according to a tourism official.

Speaking at a New Year’s reception, Robert Seeber, chairman of the Tourism and Leisure Industry Division in the Austrian Chamber of Commerce (WKÖ), praised the industry’s resilience.

“The desire to go on holiday is definitely there – we can feel it through customer demand,” he said. While bookings remain strong, tourists are keeping a closer eye on their wallets. “In certain areas, people are cutting back on incidental expenses. They are more price-sensitive and want flexible cancellation policies,” Seeber added.

Rising Costs Challenge Businesses

Personnel expenses rose by 9% last year, while energy prices also increased significantly. “Electricity costs have soared like never before, and now there are plans to increase ancillary fees and taxes,” Seeber said.

Most businesses are wary of passing these costs on to customers, fearing it might dampen demand. Labour shortages also remain a key challenge. “We need more people,” Seeber noted.

Tackling the Workforce Shortage

To address staffing issues, tourism businesses are looking at measures such as higher wages, tax incentives for overtime and more flexible working hours. A recent survey by the Market Institute found nearly 500 tourism and leisure businesses back these proposals, with 74% highlighting pay rises as a priority.

Changing Travel Habits

Economic pressures are also shaping how people holiday. A survey of 1,000 individuals aged 16 and over showed many are opting for shorter trips, budget-friendly accommodation and destinations with lower prices.

The findings showed that 68% value flexible cancellation policies, 63% are choosing more affordable regions, 56% are planning shorter holidays and 38% have decided to skip winter holidays altogether.

Cautious Optimism

While 64% of tourism businesses remain optimistic about the winter season, many are approaching it with caution. “We are hearing faint alarm bells – even tourism businesses can sense that an economic crisis is underway,” said David Pfarrhofer, director of the Market Institute.

Only 14% of businesses expect this winter to outperform the last, while 69% predict results will be on par. Rural areas and the western regions appear more upbeat compared to the east.

Don’t have an account yet? 

Latest News

Reach out for a handcrafted promotion of your business or product.