The way people travel has changed forever. Now, people are more flexible about where they live and work and take longer trips. Also, borders continue to re-open and receive people traveling in this new era. These changes are an excellent opportunity to revive tourism and provide economic support to communities after years of travel restrictions. The World Tourism & Travel Council (WTTC) estimates that nearly $4.5 trillion in travel and tourism-related gross domestic product (GDP) was lost last year due to the pandemic, affecting more than 61 million jobs1.
Airbnb is committed to support economic growth across Latin America and the Caribbean (LAC), helping people participate actively in the tourism economy by becoming Hosts on Airbnb in new and diverse destinations beyond the same popular tourism circuit. During a IV CEO Summit of the Americas panel on “Economic Recovery through Tourism”, Airbnb Global Head of Hosting Catherine Powell, shared data from a new Oxford Economics report demonstrating how Airbnb is powering tourism recovery in the region.
Key findings from Oxford Economics include:
- Economic activity directly stimulated by Airbnb Guests has rebounded quickly, helping support the recovery of Latin America and the Caribbean tourism overall with over 4.3 million more Airbnb Guest stays in 2021 than in 2019.
- Spending by Airbnb Guests totaled $16.4 US billion in 2021, equivalent to nearly 4.9% of all direct tourism activity in the region, according to the Oxford Economics analysis
- Airbnb Guest spending (excluding host earnings) directly supported $8.9 US billion of GDP, 416,000 jobs in Latin America & The Caribbean, generating $4.5 US billion of wages, salaries and other labor income across a range of sectors.
- Guest spending associated with 1,000 Airbnb Guest check-ins during a year directly supports 15 jobs in the region, with wages, salaries and other income totaling $158,000 US (excluding host earnings).
- Spending by Airbnb Guests increased by an estimated $8.1 US billion in 2021, reaching a level more than one-third higher than 2019 (41.9% above), even as broader tourism spending in the region was still one-fifth lower than in 2019 (22.7% below).
- For each $10 US spent on accommodations, Airbnb Guests spend an additional $45 US at other businesses during their trip like restaurants, transportation, and other activities.
Those numbers are especially important given the fact that tourism is an increasingly important part of the Latin American and Caribbean economies. Tourism supported 8.5 million jobs and contributed over $180 US billion to GDP across the region in 20212. The sector is rebuilding from pandemic impacts and Oxford Economics’ forecast anticipates visitor spending in LAC will approach $500 US billion in 2025 ($492.6 US billion), over 16 percent above its pre-pandemic level.
“We wanted to explore the economic significance of Airbnb’s footprint in Latin America and the Caribbean. As cities, states and countries plan for the months and years ahead, this data shows that Airbnb can be an important part of economic revitalization throughout the region, supporting local communities and businesses, and providing local Hosts a way to earn a meaningful income. We look forward to continuing to work with partners and governments to make this a reality,” said Catherine Powell, Head of Hosting of Airbnb.
This positive economic impact is fostered by millions of Hosts on Airbnb who are welcoming Guests in destinations across Latin America and the Caribbean, and through promoting a kind of travel and tourism that benefit Hosts, Guests, and local communities:
- Hosts on Airbnb keep up to 97 percent of what they charge for their listing, and unlike many big hotels, Hosts keep the money they earn in the community.
- Listings published on Airbnb are located in a wide range of neighborhoods, including neighborhoods that do not typically benefit from tourism.
- When Guests arrive at their listing, they often receive recommendations from their Host on local businesses to visit, many of which are in the neighborhood where they stay. This type of hosted travel helps Guests live like locals and has a significant positive economic impact as Guests spend time and money in local restaurants and businesses.
During the panel, Powell reiterated that Airbnb is committed to helping re-distribute tourism and foster economic empowerment in the region. “People are traveling again, but they’re traveling in a different way: staying longer and exploring new places. More than 800 cities and towns throughout Latin America and the Caribbean received their first booking on Airbnb since the beginning of the pandemic. This spreads the economic benefits of tourism to communities that didn’t have this opportunity in the past.”
Inclusion and benefits for all
Tourism and economy experts also highlighted the importance of an inclusive and integrated tourism policy framework that benefits entire communities in a sustainable way. From this angle, Powell explained how Airbnb’s platform is empowering women to thrive in the tourism economy, with over half (53 percent) of Airbnb’s Host community in Latin America and the Caribbean identifying themselves as women, and during 2021, new women Hosts in the region earned approximately $91 million US on the platform3.
The platform also reported that based on an internal survey, more than 60 percent of the Hosts on Airbnb reported having a full time or part time employment, making hosting an opportunity to generate extra income: one-fifth (21 percent) of the Hosts on Airbnb identified themselves as teachers and over 10 percent as healthcare workers4.
According to the International Monetary Fund, inflation in Latin America’s largest economies is the highest it’s been in 15 years5. Also, the Economic Commission for Latin America and the Caribbean informed that in 2021, inflationary pressures were observed in the majority of the region, and are expected to continue in 20226. Against the backdrop of higher prices, Hosts on Airbnb across the region are using the income they earned by publishing their listings on Airbnb to help pay for their most basic needs and to have a better quality of life. Hosting as a way to make money to help cover the rising cost of living (in Latin America and the Caribbean the cost of living is 4 percent more than the global average) was one of the main reasons why nearly 40 percent of Hosts decided to share their space.
Moving Forward: Supporting Cities
Airbnb can be an essential partner for cities by helping create jobs and disperse the benefits of tourism to more neighborhoods, and the company has long worked to help promote sustainable travel and economic growth.
In June 2020, Airbnb launched an initiative to expand their work with destination marketing organizations, governments and nonprofits to support local economic recovery. To date, we have celebrated over 140 partnerships and collaborations spanning more than two dozen countries, including recent campaigns with the Caribbean Tourism Organization, Discover Puerto Rico, Mexico’s Jalisco State, and Brazil’s São Paulo State.
In terms of sustainability, Airbnb in Latin America and the Caribbean has partnered with WWF to promote sustainable, safe and responsible tourism in Mexico, Costa Rica, Colombia, and Brazil. The alliance highlights culturally authentic and biodiverse destinations as an alternative to mass and traditional tourism. It also encourages Guests to learn more about the local communities they visit while contributing to domestic tourism reactivation as well.
Oxford Economics analyzed the economic impact of the Airbnb community in Latin America and the Caribbean.
For the purpose of this analysis, Airbnb Guest spending refers to all trip spending except accommodations, also referred to as host earnings. It includes daytime spending in the destination, such as restaurants, shopping and entertainment, as well as local transportation and transportation to and from the destination.
The Latin America and the Caribbean region analyzed consists of 48 countries and territories from Mexico to Chile, including the Caribbean.
The analysis is based on a combination of Guest activity and Guest survey data provided by Airbnb and Oxford Economics’ estimates of the direct economic impact of tourism, in terms of GDP, jobs and income in each country and territory.
Oxford Economics prepared model-based estimates to normalize and extend Guest spending estimates, for example to include transportation spending to/from the destination and calculated key impact ratios based on previously estimated country-level relationships between tourism and economic activity.
The analysis focuses on direct impacts, which consist of Guest spending (excluding accommodations or host earnings) and the GDP, jobs and income directly supported by that spending. The direct impacts quantified in this analysis exclude important multiplier effects, such as indirect supply-chain impacts that occur as businesses directly serving visitors purchase inputs from other businesses.
Download the Oxford Economics report here