CALEB MILES: Don't Scare Off Business Travel
Much has been made in the press lately about corporations in our country receiving TARP funds and misusing these on extravagant business travel.
Many Americans are angry, and rightfully so. Adding insult to injury are the outlandish bonuses going to company executives at companies like AIG. In these tough times, it's tempting to seek out all these "bad guys" and apply the appropriate punishment.
Certainly there are those who have abused the system and our trust. What exists, regrettably, is a "baby and bath water" situation here, and the long-term impact hurts us all. What started out as well-intended, good journalism, unfortunately has spiraled into an overzealous attack on all corporate meetings and incentive-related travel in our country.
In a slow economy, or any economy for that matter, the last thing we need is the unnecessary damaging of one of our nation's and state's leading drivers of jobs and economic activity. After all, one in eight jobs in our country is directly related to the travel and hospitality industry.
Unfortunately it's not just some of the media that have gone overboard -- add in several elected officials that view this as an easy target for political gain. Fanatical legislation on corporate travel has been proposed that will only make matters worse.
It's time to take a deep breath and focus on what is really going on here. While some financial service-related companies have used poor judgment and misspent funds designed to rescue them on ill-advised travel, this does not represent what the vast majority of corporate travel really is. Prescribing the appropriate dose for the prescription is in order. A massive overdose is not.
Succeeding in business is based on securing future business, which for many requires traveling to where customers are located to sell/retain the product/service (this includes industry-related trade shows and meetings as well).
Additionally, in a highly competitive marketplace, corporate workers need continuous professional education (often requiring travel), and many sales personnel are driven by a variety of incentives (again, often requiring travel) built into their compensation packages. These are tried and true practices, and are not travel junkets.
The problem is that all this travel has been lumped into one category and labeled as bad. What is bad is when companies elect not to engage in necessary travel, afraid of the negative ramifications from the press or politicians. Creating a notion that all travel is bad is just the wrong way to go, and it will result in an acceleration in downward economic activity. Why? Here are some of the facts of what this form of tourism contributes to the economy:
-- Business travel creates 2.4 million jobs. Meetings and events are directly responsible for one million jobs in the U.S.
-- Business travel accounts for $240 billion in spending and $39 billion in tax revenue at the federal, state, and local levels.
-- Nearly 200,000 travel-related jobs were lost in 2008, with another 247,000 predicted to be lost in 2009, according to the U.S. Labor Department and Commerce Department.
-- If a million jobs generated by meetings and events were lost, the U.S. unemployment rate would rise from 7.6 percent to 8.3 percent.
-- Business travel impacts millions of businesses across the country from hotels and convention/conference centers to restaurants, retail stores, numerous suppliers, attractions (including recreation like golf), as well as airlines/transportation companies. A large number of these businesses are small in size, and many are our neighbors.
Bringing this home to Moore County: Travel and tourism activity accounts for $349 million in visitor spending annually, while directly employing more than 5,500 of our fellow citizens and thousands more indirectly. Taxes generated by these visitors total more than $24 million each year, which saved each household more than $1,000 annually in 2008, if these were not paid via visitor spending here.
So what can you and we do about this?
For beginners, we can educate our co-workers, friends and families on the importance of travel and tourism, as well as providing a reasonable perspective on the TARP issue and overall corporate travel.
Second, we can talk to our elected officials about the importance of jobs that exist now in tourism, and how we need to save those by being sensible about future legislative action.
Finally, reinforce the message to the media on the value of tourism, and why restricting travel is not good for the economy.
I want to thank The Pilot for allowing us to share this perspective. An additional resource for this topic can be found at www.meetingsmeanbusiness.com.
Please let me know your comments, or other ideas on this subject.
Caleb Miles is president and CEO of the Convention & Visitors Bureau of the Pinehurst, Southern Pines Aberdeen Area.
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