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For students in hospitality industry, a rough road ahead

01:00 AM EST on Wednesday, January 14, 2009

By Benjamin N. Gedan

Journal Staff Writer

“There is pent-up demand. When [travel to the United States resumes], it’s going to come back fast,” says Roger J. Dow, president and CEO of the Travel Industry Association, at Johnson & Wales University.


The Providence Journal / Mary Murphy

PROVIDENCE — Roger J. Dow, a former Marriott executive, is generally upbeat when he talks about the hospitality industry. After all, as head of the Travel Industry Association, his job is to talk up tourism.

But during a visit to the Hospitality College at Johnson & Wales University yesterday, Dow said the recession has not spared the country’s hotels and restaurants. Hospitality graduates expecting management positions, he said, may end up as line cooks or at a hotel front desk.

“People are concerned,” Dow said in an interview. Students, he said, “are going to have a tough time right now. Every time we have a recession, people over cut.”

Last year, the national hospitality sector –– a broadly defined industry that includes food, lodging and transportation –– saw revenue drop by 2 percent, Dow said.

Upscale restaurants are particularly vulnerable, he said, and waiters everywhere are seeing diners opt for house wine. Corporations, meanwhile, are holding off on large meetings, leaving convention centers empty.

In Rhode Island, the impact is also being felt. Revenue from the 1-percent hotel tax collected for municipalities dropped by 4 percent last August compared with the same period a year ago, according to an analysis of state tax records. Collections fell 9 percent in September, 13 percent in October and 4 percent in November.

Restaurant sales are also down. The 1-percent tax on food and beverages collected for cities and towns fell 9 percent in November and 5 percent last month.

There are few signs of a quick economic turnaround, with unemployment continuing to rise. But Dow insisted there is hope for hospitality, and it comes from outside the border. Barack Obama’s inauguration, Dow said, could significantly boost tourism in the United States by improving the country’s reputation abroad.

“Our image has suffered over the past decade,” he said. “The foreign press is beating us like a drum.”

That loss of prestige, coupled with onerous visa regulations and aggressive security procedures, has taken a toll, Dow said. In the mid-1990s, 9.5 percent of foreign travelers chose the United States as their destination. That figure dropped to 7.5 percent in 2000 and 6 percent in 2007.

Although the number of travelers leaving their home countries grew by 35 million from 2000 to 2007, Dow said, the number of foreigners visiting the United States, excluding Canadians and Mexicans, decreased to 24 million from 26 million.

“There is pent-up demand,” Dow said. “When this thing comes back, it’s going to come back fast.”

Rhode Island has long courted foreign tourists. In 1996, it joined the other five New England states in forming Discover New England, a consortium that operates offices in England and Germany and markets New England to tour operators, travel agents and journalists. This year, the state is contributing $100,000 to the effort.

Despite the recent recovery of the dollar against many foreign currencies, and the global scope of the economic slowdown, state tourism officials see foreign tourists as key for weathering the recession.

“We’re expecting that this will still be a strong market,” Mark G. Brodeur, who replaced David C. DePetrillo as the director of the Rhode Island Division of Tourism in October, said yesterday.

In all, tourism generates $4 billion in economic activity in Rhode Island and produces 12 percent of state and local tax revenue, according to the state Economic Development Corporation. About 55,000 residents work in the industry.

bgedan@projo.com

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