I was talking to my brother who lives in Maine. He shared with me the state’s four-stage gradual reopening plan, specifically the impact it will have on tourism and the state’s economy. Reminded me of what is happening here in Cannes without the film festival, a total COVID-19 Domino Collapse!
By the numbers:
- An estimated 28 million tourist visited Maine last summer. Note: State population 1.338 million.
- Total expenditures for tourism, $6.2 billion at last count (2018).
- Tourism supports approximately 110,000 jobs; 16% of the state’s employment.
- Average stay 3 to 4 nights.
Governor Janet Mills announced as part of the state’s recovery plan, a 14-day quarantine for all out-of-state visitors. Obviously 2020 is not going to be a banner year for Maine’s summer tourism. All I can think about is the COVID-19 Domino Collapse that will result. Below are a few potential economic blows:
- The hospitality industry – Lodging revenue, businesses that supply hotel & motels with linens, cleaning materials, etc.
- The restaurant industry – Lost F&B sales, businesses that support restaurants like equipment, cleaning materials, waste removal, etc.
- Local food supply chain – The decline in primary and secondary distributor sales, local signature specialties like produce (e.g., Maine russet potatoes, blueberries), lobster, seafood, etc.
- A reduction in the discretionary income spent on necessities (e.g., groceries, personal care, etc.) by all the unemployed or furloughed workers due to the decline of the three industries mentioned above.
- Recreational rental revenue – Boats, canoes, kayaks, bicycles, etc.
- Tours – Cruise ships, buses, fishing, New England Clam Bakes, etc.
- Camping related revenue – Campsite fees, camping paraphernalia and supplies, etc.
- Reduced outlet sales (e.g., L.I. Bean) in Freeport.
I could go on and on and on. Do you have any Maine tourism dominoes to add to the list?
Moving forward, whenever anyone talks about the macroeconomic crash of a business sector impacted by our current health crisis, like Maine tourism, I will continue to analyze the microeconomics resulting in total COVID-19 Domino Collapse.