Las Vegas is showing promising signs of recovery with travelers choosing it as a vacation destination or a place for a stopover.
Already see a sharp incline in visitor volumes (Figure 2) and anticipate that to grow; especially, since several routine annual events from the first half of this year have been shifted to the fall and winter (Figure 3)
The google search results for 2018, 2019, and 2021 show a similar trend with searches peaking around the summer; thus, visitors must be planning for the Fall and Winter (Figure 1)
The visitors show a keen interest of making a road trip - starting in March this year, the number of arrivals by road have surpassed the counts to that of 2019; Relatively domestic and international travel by air fall short by -40% and -90%, respectively (Figure 4)
Increase in highway traffic leading into Las Vegas would benefit the relevant service sectors, places of interest and cities along the way where the travellers would spend.
Our outlook makes use of weekly Google search results, Las Vegas Travel and Leisure, the Las Vegas Travel Guide, 2019 Las Vegas Visitor Profile Report, HVS Las Vegas Casino Market Outlook,The impact of covid-19 on the southern Nevada tourism industry and monthly data extracted from the LVCVA Research center. The research and data analysis provides a synopsis on the 2021 travel insights for Las Vegas, Nevada.
Spring: March - May, and Fall: September - November are the best times to explore Vegas and enjoy the outdoors when the heat of the Mojave Desert does not affect your stay. There is an observable trend in the distribution of the search results with the search peaking during or closer to the summer season.
Although the visitor volumes are quite uniform throughout the year, it is evident that Google search results follow a similar trend to the number of visitors entering Las Vegas, slightly peaking during the beginning of Spring and Fall; thereafter, decline leading into the Winter.
Figure 1: Index representation of search interest relative to the highest point on the chart for the given region and time.
As for 2021, visitor volumes and search results have been rising showing great interest in travel to Las Vegas after a drastic drop in 2020 due to the Covid-19 pandemic. Prior to this pandemic, more than 3 million travellers entered Vegas every month, with an average 3-4 nights stay per person. Given the correlation between google search results and visitor volumes and the reduced search index results for 2021, Las Vegas may not reach the usual visitor counts to reach the target ~43 million count.
The numerous events and activities during Spring through Fall, begin to draw attention from many domestic travellers. As the season for most sporting events wrap up between August - October, Las Vegas predicts more visitors during this time, all the way throughout Winter as most 2021 events have been postponed to the later part of the year.
Though International arrivals do not show signs of recovery, domestic air travel is evidently picking up but falls 40% shy of the 2019 volumes. Road trips to Vegas have already surpassed the 2019 numbers and will be the primary choice for quite some time.
As a result there will be less people renting cars from Las Vegas rental agencies to visit the top five nearby popular sites: Grand Canyon, Hoover dam, Zion National Park, Bryce Canyon and Death valley. However, the car rentals may shift to renting from agencies at their point of origin rather than in Las Vegas. The economic losses to the airline industry will be shifted to car rental agencies because travellers are more inclined to rent a car for a road trip than drive their own vehicle. A slight increase in revenue to public transport and tour operators can be anticipated but the desire for social distancing will be a key factor in their choice.
The average daily traffic among the three major highways leading to Las Vegas has shown a slight increase in 2020 in comparison to 2019. The recovery of travel and general economic performance including hospitality and leisure is expected to accelerate, as vaccines, medical therapies, and public confidence supports the beginning of the return to pre-pandemic levels.
Amongst the total visitors to Las Vegas in 2019, 51% of travellers have used ground transportation (Automobile/Bus/RV) to reach Las Vegas, out of which the majority was from western states like California. A typical road trip traveller spends most on food, fuel and other amenities on their way to Las Vegas, which also contributes to the economic growth of States and Counties in the periphery of Las Vegas.
Research from the past 05 years shows that 14% - 20% of visitors to Las Vegas are international travelers. As of Jun 8,2021, visitors who have spent the last 14 days in the banned list of countries are not allowed to enter the US. Further, from the top three countries: Canada, Mexico, and the United Kingdom, accounting for 70% of international visitors, the U.S. government had extended the closure of land borders with Canada and Mexico to non-essential travel, such as tourism, through August. Therefore, until borders reopen the influx of 49% Canadian and 18.1% Mexican visitors will be at a zero.
Las Vegas has consistently been a top 5 travel destination in the USA for the past decade and 30.1% (~ USD 63.6 billion) of the Gross Product is from visitor spending. On average, the gaming city has been attracting 3.5 million monthly visitors comprising various population segments.Research from the past 05 years, shows that the majority of the visitors are in Las Vegas for vacation and pleasure., Out of which, 60% are first time visitors and 29% are repeat visitors.
Having 14% of repeat visitors and 11% of first timers, visiting friends and relatives have become the second most popular reason to visit. Surprisingly, the 2019 Las Vegas Visitor and Convention Authority report from an online survey comprising a tiny sample (~1,200 respondents) revealed that only 15% of the visitors come to gamble while 45% are interested in experiencing the city streets. According to the 2019 Las Vegas Visitor Profile report, the largest segment of the visitors are those who are married (~73%), employed (~69%), and between the age of 30-60 years (~60%). Conventions attract approximately a fifth of the visitors each month, while February and October are the most populous times.
Visitation to Las Vegas remained above 42 million each year from 2015 through 2019 before the impact of the COVID-19 pandemic resulted in a decline to 19 million in 2020. However, there has been an increase in 2021 and visitor volumes are expected to keep rising every month.
2020 COVID-19 year was devastating for all economies across the globe and about 33% of the city’s hospitality and leisure workforce lost their jobs.
Among major tourist destinations in the US, the Las Vegas metropolitan area has the highest share of employment sourced to the tourism industry at 29%.
In 2020, the gaming revenue recorded its lowest value of $6.5 billion since 1989. The entire Nevada economy is heavily dependent on the gaming, hotel, and convention industries, reaching a record of lowest visitations since 1989.
As indicated in the LVCVA reports and the report on impact of covid-19 on the southern Nevada tourism industry, the annual GDP and the direct visitor spending for 2019 were at $153.73 billion and $36.9 billion, respectively, which means that 24% of the annual GDP was from direct visitor spending.
In 2020, the visitor spending has dropped to 12%, with a GDP of $146.67 billion and direct visitor spending of $17.6 billion. However, Las Vegas has an increasing trend in visits and searches for the city, as per July 2021.
In conclusion, even though the leisure and hospitality industry took a devastating hit in 2020, as per our research and analysis, the industry has been able to rejuvenate, showing promising signs of recovery in the latter part of 2021.
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