Long Island tourism spending tops pre-pandemic high

Tourism spending on Long Island hit a new high-water mark in 2022, outpacing pre-pandemic spending records and prompting industry groups to say local tourism is back on track.

Visitors to Long Island spent a record $6.6 billion last year, up 14.4% from 2021, according to a state report conducted by Tourism Economics, a travel analytics and economic impact forecaster owned by Oxford Economics, an advisory firm. It was the first time direct visitor spending topped the pre-pandemic record of $6.3 billion in 2019.

The majority of tourism spending was concentrated in Suffolk County — 56%. Purchases at Long Island restaurants and bars accounted for $2.4 billion, or 36% of overall visitor spending. Spending at hotels made up 19% and purchases at retail businesses made up 17%.

One of the biggest factors for the higher rate of spending has been the impact of inflation and the rising cost of goods and hotel stays, said Kristen Reynolds, president and chief executive of Discover Long Island, the region’s tourism and hospitality marketing organization.

For example, while hotel occupancy was up, “what was really driving” spending was the higher room rates visitors paid, Reynolds said.

Visitor spending on the Island generated $464 million in local taxes last year as a result of sales, property and hotel taxes, according to the report.

“We knew that 2022 was going to be a record-breaking year based on what we were seeing in our hotel numbers,” Reynolds said.

The industry had been poised to see growth in 2020, she said, but the pandemic’s impact halted momentum — although not as dramatically as for other destinations across the country. The Island saw tourism spending fall to $4 billion in 2020, a drop that could have been worse without tourism from New York City residents looking for nearby leisure opportunities, Reynolds said.

Visitors from the city make day trips to the Island, but also account for an average of 60% of overnight visitors to Nassau and Suffolk, according to Zartico, a technology firm that tracks visitor foot traffic.

Beaches, vineyards are key

The Island’s beaches and vineyards continue to be a major draw for visitors, Reynolds said, and with a majority of waterfront hotels being located on the East End, Suffolk was a beneficiary of seasonal summertime spending.

“The beaches are key,” Reynolds said. “Additionally, we have become a very popular fall destination for harvest season, so the vineyards are also a huge draw.”

Hotel occupancy and spending levels this year indicate the Island likely will see a banner year in 2023.

“We’re on pace ... to be even higher than last year,” Reynolds said. “We’re going back to what we would see in normal years.”

The region’s higher level of spending is in line with the state’s overall performance.

An estimated 291 million visitors, both domestic and international, to the state spent $79 billion in 2022, up nearly $27 billion from 2021, according to Tourism Economics. That spending had a total economic impact of $123 billion when including the effect of both “direct and induced impacts.”

Direct impacts refer to the income and taxes generated by visitors spending money on recreation, transportation, food and lodging. Induced impacts refer to the money hospitality employees in the community earn and spend as a result of tourism spending.

Dorothy Roberts, president of the Long Island Hospitality Association, said Long Island’s tourism industry has come a long way from the depths of the pandemic.

“We can all look back and say 2020 was devastating and that 2021 was the recovery year,” Roberts said. “We’ve had to go through many obstacles to get to where we are now.”

Inflation, hiring pose challenges

Despite the resurgence, one of the biggest hurdles for hoteliers and restaurant owners has been the elevated cost of goods and vendor services, all of which factor into what travelers have to pay, Roberts said.

“You might be paying a little more for catering events or to stay in a hotel room, but the expenses in those businesses have gone up,” she said. “Not just wages, but insurance, utilities and supplies, those expenses have all gone up.”

Additionally, employment in tourism has yet to rebound to 2019 levels, a continuing challenge for business owners, particularly customer-facing businesses like restaurants and hotels that can’t find enough workers.

The number of tourism-related jobs on Long Island in 2019 was 56,380, or 4.4% of all jobs. In 2022, that number was at 52,102, down 4,200 jobs or 7.6%, according to figures by Tourism Economics.

While staffing wasn’t a major issue for summer season attractions like Splish Splash in Calverton this year, the 96-acre water park has had to change recruitment strategies to fill its more than 800 seasonal openings, marketing director Danielle Trombetta said. “We started our hiring efforts earlier in the season and were more strategic with our recruitment program,” she said.