By Alan Zibel
Tourists in the U.S. kept their pocketbooks closed as the
economy stumbled earlier this year.
Spending on travel and tourism fell at a 1% annual rate in the
first quarter from the prior quarter, adjusted for seasonal factors
and for inflation, the Commerce Department said Friday.
The drop was the largest quarterly decline since the final
quarter of 2009, when spending fell 1.8%, and came after a 4.5%
gain in the prior quarter. The pullback was led by an 11.2% decline
on spending on recreation and entertainment, while food and drink
spending fell 3.5%.
The results come as stormy weather and a choppy economic
recovery led to a rough start of the year for major operators of
amusement parks.
SeaWorld Entertainment Inc. last month reported a wider
first-quarter loss of $49.4 million. The company attributed the
results, in part, to bad weather and a shift in the timing of
Easter and spring break to the second quarter of the year. Six
Flags Entertainment Corp. cited similar reasons for its 16% drop in
revenue as it reported a $61 million first-quarter loss.
Still, the drop in tourism spending was less severe than the
overall economy, which contracted at a 2.9% annual pace in the
January-March period.
Employment in tourism-related industries climbed 2.1% in the
first quarter, compared with a 1.5% gain for total U.S.
payrolls.
The quarter's drop may be a temporary blip, and some tourism
companies are seeing healthy results. Earlier this week, Carnival
Corp. raised its earnings estimates for the year, with Chief
Executive Arnold Donald citing "a gradually improving economic
environment."
The Federal Reserve's latest beige book summary of economic
activity said tourism was strengthening in much of the country,
especially in the mid-Atlantic. Prolonged winter weather has
"increased cabin fever and demand for summer getaways along the
shore," the Fed said. "In addition, some boat owners are bringing
their boats back to the shore following recession
belt-tightening."
Write to Alan Zibel at alan.zibel@wsj.com
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