2015 tourist spending sets new state record

The Institute for Tourism and Recreation Research recently reported that the 10.8 million nonresident visitors to Montana last year spent $3.9 billion — a record high for the state’s growing tourist industry and its 55,000 workers.

Nearly a third of that money went to vehicle fuel, about 17 percent went to restaurants and bars, about 15 percent to retail sales, about 10 percent to lodging and about 10 percent to groceries and snacks.

Nonresident expenditures, adjusted for inflation, steadily grew from $2.5 billion in 2004 to $3 billion in 2007 before suffering 14.8 percent and 16.4 percent setbacks in 2008 and 2009 respectively.

As the nation gradually climbed out of the economic recession, nonresident expenditures saw double digit growth in 2012, breaking the $3 billion mark again and topping out at $3.3 billion.

ITRR researcher Kara Grau reports in her March 31 study that Montana’s overseas visitors, accounting for about 2 percent of all visitors, averaged 7.34 days and $1,284 per visit.

Domestic visitors, about 82 percent of the total, averaged 5.44 days and $838 per visit. Canadian visitors, about 14 percent of the total, averaged 2.2 days and $396 per visit.

Montana’s two national parks had banner years in 2014, with Glacier National Park posting a record 2.3 million visitors and Yellowstone National Park posting a near-record 3.5 million visitors.

Worldwide, travel and tourism grew by 5 percent last year through August, with international arrivals in the U.S. up by 8 percent.

Some new trends are visible in the Montana numbers, according to ITRR director Norma Nickerson and research assistant Megan Schultz.

“More and more, travelers are opting to spend nights in homes and reserving their accommodations through Vacation Rental By Owner or Airbnb,” they said in a recent business report. “There are hundreds of known vacation rental properties in Montana, with the majority located near the two national parks and the ski resorts.”

Nickerson and Schultz noted that while there are concerns about rental properties operating without a license and lost state bed tax collections, the growing vacation rental sector “does not appear to be affecting Montana’s hotel/motel industry.”

“Rooms sold in hotel/motels in Montana for 2014 were up nearly 6 percent through October, compared to 2013,” they reported.

Nickerson and Schultz forecast a strong tourist economy this year. Supporting factors include lower unemployment boosting household spending, more discretionary income as households pay off debt, a stronger U.S. dollar, the U.S. travel sector outperforming all projections, hotel occupancy surpassing 2007 pre-recession numbers, intention to travel increasing, and the return of face-to-face business meetings.

The U.S. Travel Association forecasts a 2 percent growth in domestic travel this year, while international travel is expected to see steady growth.

“Montana should experience a 2 percent visitation growth as well,” Nickerson and Schultz said. “In 2015, nonresident visitor spending should increase anywhere from 2 percent to 5 percent, amounting to more than $3.6 billion and producing an economic impact to Montana of more than $4.4 billion.”