Coastal tourist dollars don’t stay local

In 2024, an international report by The Travel Foundation showed that globally, around 50-80 per cent of coastal tourist dollars are 'leaked' from the destination, providing little or no local benefit.

In New South Wales, towns with a Coles and Woolworths take the lion's share of tourist dollars, followed by short term rentals owners in Sydney and Canberra with properties on the coast.

It's time to move beyond 'happy face' discussions about tourism's so-called contributions to the local economy of coastal towns and critically examine where the benefits are going.

In my home town of Kiama, one would think that with 1.3 million tourists driving $30 million a year 'into' the Kiama economy, local small business owners would be jumping for joy.

But these small business owners are at the very end of the 'trickle down' cash flow. Coles, Woolworths and city-based Airbnb owners reap up to 70 per cent of tourist expenditure.

Small businesses survive on the big sugar hit over Christmas, when visitor numbers peak. There's a smaller hit in Easter and then dribs and drabs.

Some large establishments do well over the holiday periods but for ten months of the year, small businesses are carried by locals wanting a beer, a haircut or a coffee. It's locals who keep coastal (and regional) towns going.

When one carves through the advertising spin and glossy drone snaps of pristine white beaches, retail and service business in coastal towns are battling.

When consumer spending flatlines - like it has for the last 18 months (some would say since the GFC) - small business profits in these towns plummet.

Retailers are also paying exorbitant commercial rents on their properties. While it varies from town to town, commercial retail rents have gone up more than 40 per cent since the end of the Covid-19 restrictions.

As the economy cools and inflation rises, as small businesses close and interest rates climb, the keen observer may notice the locals are more aloof. They're still welcoming but like the old days of surf localism (this is our beach!), tempers are quick to flare.

One reason is many of the coastal councils use rate payers monies to flog their towns and hinterlands. The glamourous online and magazine marketing campaigns don't mention roads packed with cars or the police breaking up another alcohol and drug-fuelled Airbnb party.