Blog

The Canadian tourism sector has experienced a brisk recovery since the initial pandemic lockdowns, according to economic experts. But that recovery pace has been easing due to higher interest rates, a slowing job market, and broader cyclical slowdown in the U.S. and abroad. In Ontario, many tourism operators continue to face a great deal of debt caused by the pandemic, prompting many to worry about what the future holds. 

Locally, tourism in 2024 is expected to continue to do well, despite the ‘economic crunch’ that may prompt travelers to adjust their plans in the coming year. 

We reached out to Explore Waterloo CEO Michele Saran to get her take on what the local tourism sector can expect in the New Year:

How is local tourism shaping up for 2024, considering the economic realities many people are dealing with?

Tourism in Waterloo Region is expected to continue doing well into 2024.  We are beating 2019 pre-pandemic; hotel occupancy numbers and campaigns are driving keen interest in our offerings.  Yes, the economic crunch is impacting everyone and may result in visitors spending a bit less but not completely abandoning all vacation plans.  People consider travel a priority and have been shown to spend less in other discretionary areas to afford some kind of getaway with family and friends. Waterloo Region’s main market is the GTA, and we really lean into the concept of being the perfect road trip destination.  This type of travel can be as budget conscious as one wishes.  There are so many affordable options for fun.

Are local tourism operators feeling optimistic about what is in store for 2024?

The operators I speak with are all quite optimistic about a strong 2024, despite concerns around inflation and its impact on visitor spending.  In addition to leisure travel, we are also seeing incredible interest in the region for meetings, conventions, and sporting events.  The tourism industry is nothing if not resilient. Having come out on the other side of a worldwide pandemic that shut everything down completely, we now have the gift of perspective.  

What are some of the hurdles do local tourism operators face in the coming year?

One of the biggest challenges facing tourism operators everywhere (not just in Waterloo Region) is rebuilding the workforce.  Hospitality workers left the industry during the pandemic, and many did not return.  Industry advocacy organizations are working to address this issue from many angles, from working with government to ease immigration barriers to marketing the industry to students as a career choice. Finding affordable housing is a big hurdle for those in the service sector.  Many of the destinations that are the most popular with visitors are also very expensive places to live.  People want to live in the same area where they work, and this presents another labour-related challenge for the tourism industry as well as many others.

Despite optimism for next year’s visitation potential, a very significant issue is the amount of debt tourism businesses incurred during the pandemic just to stay afloat and survive.  According to the Tourism Industry Association of Ontario, 55% of operators say they lack confidence they will be able to repay their debts in two years and 45% risk closure in three years without government intervention.  Thirty-three percent of tourism businesses indicate that they hold more than 250K in outstanding debt. This is a serious issue and one all tourism advocacy organizations continue to push with government for solutions.

Is talk of the pandemic a thing of the past?

I recently returned from the Tourism Industry Association of Canada’s Annual Tourism Congress.  The conversation was around the legacy effects of COVID cited above but I think the entire industry is ready to put the pandemic itself in the rearview mirror and focus on what we do best – welcoming visitors and showing them why our area is fantastic.   

Our Chamber of Commerce over the years has not only learned how to pivot, but how to address the concerns, issues and needs of the small and medium-sized businesses in our community.

The events of the last few years have only strengthened our reason for being. We not only champion small and medium-sized businesses but are a source of information, guidance, and the most powerful connector there is.

We have now taken that connection to a new level thanks to ‘The Link’, a place where YOU, an SME business owner/manager can source solutions in a one-stop shop atmosphere. And since this is Small Business Week (Oct. 15-21), it's very important to always remember and celebrate the contributions SMEs make to our economy.

For the last seven months, our Chamber has undertaken this huge project (for us). To say we’re excited is a dramatic understatement because for you, we’ve invested and created an exciting, inspirational space that will not only knock your socks off but provide a place where you can share your troubles and find connections to help you navigate those issues that sometimes surface for every business.

At The Link you can source HR solutions, legal forms and information, access grant writing, and discover business services of all types that help you streamline, or even eliminate operational costs, and yes, of course, we also have direct access to financial resources only for business.

Another aspect to this renovation project is the creation of additional meeting spaces. We can now offer two boardrooms, one that can seat more than 20 and the other between eight and 10, plus a more informal meeting space for five and a private soundproof meeting “pod” also for up to five people. As well, have casual conversation areas and provide a wonderful coffee service.

The Link is modern, accessible, and a great place to have a coffee and share conversation all contained in little over 2,220-square-feet of prime real estate at Highway 401 and Hespeler Road.

Along with this incredibly cool and unique space comes some unbeatable programming to help you and your team get onside, get ramped up, and get excited for what comes next.

Programming at The Link has already been released and space is very limited, so you need to get in early and make sure there is a seat for you. Our Program Manager, (Amrita Gill), is already developing new and different ways for us to connect with meaning, with passion, and as always, with inspiring ideas.

The doors opened Oct. 1 and we already have some committed entities ready to set up shop at The Link, but there may still be room for you and your organization. Do you serve only small and medium-sized business? If so, send me a note and maybe, if all the checkmarks are in place, we may just have a spot for you at The Link, but you need to hurry. Yes, there is a cost because we are not a “funded” organization and our support comes from our membership.

Speaking of membership, did you know the Cambridge Chamber of Commerce has NOT increased its membership fees in more than 25 years? Talk about an inflation stopper, wow! That is what serving business means to us. We will always find ways to support you and now we are looking for your support to continue the work we do.

So please share your expertise with us and book a pod at The Link, or come in and get help from organizations and businesses that are here for you. Even better, drop in and enjoy a coffee, latte, cappuccino, espresso, or my personal favourite, a mochaccino. Hey, I might even buy you one. See you soon at The Link, 750 Hespeler Rd., the Cambridge Chamber of Commerce.

As pandemic restrictions continue to lift in Ontario, the urge to get away is growing stronger.

To encourage Ontarians to explore their own ‘backyards’, the Province unveiled its Staycation Tax Credit for 2022 earlier this year in hopes of inspiring residents to not only travel but provide some much-needed boost to the hospitality sector.

“Attractions, hotels and restaurants have been extremely hit hard these past two years and could truly appreciate any support,” says Joe Hall, General Manager of Hospitality at Cambridge Hotel & Conference Centre. “This initiative is a great way for families to look within the province for stay packages and get 20% back at the end of the year.”

The credit – which covers accommodation expenses for hotels, motels, resorts, lodges, bed-and-breakfasts, cottages, and campgrounds – does not cover tourist attractions or restaurants.

However, Vanessa Stevenson, General Manager of Homewood Suites by Hilton Cambridge/Waterloo, says most hotels in Waterloo Region offer stay packages that provide spinoff to other hospitality-based businesses.

“If you’re going to take advantage of the credit you can always lean toward a hotel that offers these packages,” she says, referring to places that can provide theatre tickets, or restaurant deals. “So at least you’re benefitting businesses beyond just that hotel and hopefully helping the community and the tourism industry to get back on its feet.”

Vanessa says her industry lobbied hard for the credit and was pleased the Government of Ontario introduced its as of December 31, 2022. She says it would have been even more helpful if the tax credit could have been targeted to boost destination areas specifically outside the more obvious ones, like Toronto, Niagara Falls, Muskoka, and Ottawa.

“But I understand from a processing perspective it wouldn’t be feasible,” she says, noting tourist regions like ours will still benefit from tourists travelling from these popular spots.

The credit itself – which does not apply to business travel or leisure stays longer than a month in Ontario - can only be claimed by one member per family and of the eligible accommodation expenses, 20% (which translates into $200 per individual or double that as a family) can be claimed. As well, eligible expenses of up to $1,000 as an individual or $2,000 if you have a spouse, common-law partner or eligible children can be claimed.

To process any claims, detailed receipts of any eligible expenses are required. These include: the location of the accommodation; the amount of that can reasonably considered to be for the accommodation of a stay; GST/HST paid; date of stay; and name of payor.

Jessica Reuel, Senior Accountant with RLB Chartered Professional Accountants, says the amount of detailed information required may be the reason the tax credit was not extended to other hospitality businesses.

“At a hotel you receive a full listing of information and an email confirmation,” she says, adding it’s unclear if the tax credit will be extended beyond 2022. “I think it all depends on how many people will take advantage of it this year. Everybody needs a break.”

Vanessa agrees and says encouraging people to travel, especially in April and May, may be difficult. 

“It’s been very difficult to market travel within our province when we haven’t been open due to restrictions,” she says, explaining summer travel is easier for people to support since COVID-19 numbers dropped the last two summers. “I think people are aware of the tax credit but have not connected the dots in terms of the practical sense of using it.”

However, Joe says he’s optimistic things are starting to improve for his sector and hopes the new credit will help.

“Since the recent announcement in January, we have seen business starting to pick up and we are confident with the lift of the vaccine passports (March 1) we will continue to see an uprise in business getting us back to 2019 numbers,” he says, noting the struggle his sector has faced. “We are confident 2022 will be the year of rebound.”

Vanessa says it would be great to see the tax credit expanded to become a federal initiative, which would be a boost to the travel industry nationwide.

“At some point, as much as we want people to spend their money here in Ontario, the need to leave is going to be strong,” she says.

To learn more about the Staycation Tax Credit, visit: https://bit.ly/3uWgqzs

The sign outside the Hamilton Family Theatre in downtown Cambridge which usually is ablaze with light announcing current and upcoming productions for Drayton Entertainment has remained blank for some time.

But with vaccination rates rising and COVID-19 infection numbers continuing to slide downward, there is a growing sense of optimism in many business sectors, including tourism and sports and recreation, both which generate a hefty spinoff in our local economy and have been hit extremely hard by this crisis.

“It (optimism) permeates our industry because the pandemic has reinforced to many arts organizations about how important the arts are to so many Ontarians and recognizing the role they play contributing to a healthy and prosperous society,” says Steven Karcher, Executive Director of Drayton Entertainment. “I don’t think people realized how much they enjoy and appreciate the arts until they ceased to exist.”

He recalls how overnight the world changed for Drayton Entertainment in mid-March of 2020 when it was forced to cancel the run of its first show of the season Kinky Boots, which quickly led to pulling the plug on the entire theatre season at its seven stages.

“It was a difficult but necessary decision,” says Steven, noting how the company, which is also a registered charity, lost 100% of its revenue and had already incurred the pre-production costs of preparing 832 performances for its 2020 season. In fact, he says an increase of 20,000 tickets over the 2019 season had already been sold.

He says recovery will be a ‘multi-year’ effort and that for an arts organization like Drayton Entertainment, it is not something that can rebound in six months.

“We’re not able to just take our product and simply put it on a shelf and pivot to reopening with a notice of 48 hours,” says Steven. “We’re talking about an artistic process that takes anywhere from six to eight months in order to realize the end result that people will be seeing on stage.”

For sports organizations, detailed planning is also required to prepare of an upcoming season.

“I think we were always optimistic there was going to be a season for our recreational league kids,” says Derrick Bridgman, General Manager of Cambridge Youth Soccer, referring to the 2020 season.

He says planning had started in March of last year to prepare for the upcoming season and that 1,000 children had registered to play outdoors when the scope of the pandemic became clear.

“At first we didn’t know how long it was going to last or was it only going to be that ‘magical’ two weeks, or would it be done in a couple of months so we could get our season in,” says Derrick.

He says thanks to a comprehensive return to play plan created by the Ontario Soccer Association, his group was able to see a limited amount of action on the field and by the end of last summer had managed to see a few games played.

However, that changed in the fall when new restrictions came into play and affected Cambridge Youth Soccer’s Fountain Street North indoor facility, which the group also rents to external users.

“We thought it (pandemic) would be behind us when it came to our indoor season but unfortunately there was such a significant impact on indoor sports,” says Derrick, referring to the indoor capacity levels which at one point only allowed up to 50 people – players included - at a game. “We had to get resourceful and creative, just like a lot of other sports organizations and try and maintain a positivity not only for our staff, but for our users. I think a lot of parents just want to get back to normal.”

He says there is a sense of optimism for the upcoming season, noting seeing those between 12-17 getting vaccinated has been a positive step. However, he says his group, like many sports organizations, remain at the ‘mercy’ of the province, health officials and the City of Cambridge whom they rent fields from in terms of possible restrictions.

“Also, there are parents that aren’t comfortable yet putting their kids back into sports until they’re confident the pandemic is over,” says Derrick, adding his organization is now looking to start its 2021 season the weekend of July 11 in accordance with the province’s three-step reopening plan.

“The government has been intentionally vague, in my opinion, in how it has crafted some of the wording when it comes to sports and recreation,” he says. “I think they did that on purpose so provincial sports organizations can amend their return to play documentation.”

Minto Schneider, CEO of Explore Waterloo Region, says the sports and recreation sector is returning a little faster than others.

“We’re also seeing conferences rebook as well. It’s happening, but happening slowly,” she says, noting experts are not predicting a full economic recovery until 2024. “Part of the challenge is that leisure travel will likely rebound more quickly, but business travel is not rebounding as quickly since conferences generally have a further booking window.”

Minto says also having the U.S./Canada border closed and seeing conferences cancelled in the GTA has also affected local tourism due to the substantial spinoff visitors bring to the hospitality industry in terms of hotel stays and restaurant visits.

“One of the things that really drives the tourism business in Waterloo Region is group business, whether it’s a sports tournament or a conference. Those are the things that really drive our visitor traffic,” she says, adding there have been limited ‘windows’ between lockdowns for potential visitors. “We’ve had to be very cautious of how we promote our region. We don’t want to be seen as trying to attract visitors from other areas, particularly at a time when Toronto and Peel were in the ‘Red Zone’. It’s been challenging.”

But in turn, Minto says Explore Waterloo Region has been promoting the region to its own residents, encouraging them to get out and see what exists in their own backyards.

“That’s been the silver lining to this whole thing. We’ve been able to, hopefully, create ‘ambassadors’ for Waterloo Region within the region itself.”

In the future, Minto also says more conferences will operate using a hybrid method, allowing participants the opportunity to attend in person or virtually.

“This will be great because never before will so many people have the have opportunity to learn more,” she says.

Several virtual initiatives launched in the past year by Drayton Entertainment have also helped his organization, says Steven. Among these was a virtual variety show engaging more than 40 artists using the video platform Vimeo.

“We were completely overwhelmed by the uptake on that,” he says, adding the show was viewed by more than 80,000 people worldwide and came away with 125,000 impressions.

This was followed by a cabaret series via Facebook, plus Drayton Entertainment has continued its ‘world famous’ 50/50 draw online.

“We’ve been able to give away significant jackpots in the three months we’ve been running that,” he says, adding having the 50/50 draw has also ensured Drayton Entertainment fans and supporters remain feeling connected to the organization.

And although a virtual component may still play a role for Drayton Entertainment once audiences are allowed to return to its theatres, Steven says it will never replace the feel of having a live audience.

“One of the things people don’t realize is how imperative a live audience is to not just a live theatre experience, but any live cultural experience,” he says, adding people crave the ‘connectivity’ of being together, even when it comes to family gatherings.

Minto agrees and says vaccinations and initiatives, such as the rapid screening kit program launched by the Cambridge and Kitchener Waterloo Chambers of Commerce, and Communitech, have been beneficial to the community.

“I think it has given people confidence that they can go to work. In our industry, we’ve had staff who’ve been afraid to go back to work because they hadn’t been working for a while and want to make sure they don’t bring something home with them to their families,” she says, adding Explore Waterloo Region and the Chambers continue to work with other partners to ensure the most up-to-date and reliable information is conveyed to all their stakeholders.

“I think everyone is really looking forward to a time when they can actually open their businesses and welcome people back,” she says.

For more on Explore Waterloo Region, visit http://www.explorewaterlooregion.com. For information about Drayton Festival, visit https://bit.ly/3z2aqop. And for more on Cambridge Youth Soccer, visit www.cambridgesoccer.ca