Spending rebounds, but jobs lag from pre-pandemic levels
Rhode Island’s tourism economy saw significant growth in 2023, with visitor spending reaching $5.6 billion, according to a new study commissioned by the state. Presented by the international consulting firm Tourism Economics for the Rhode Island Commerce Corporation, the research highlights that while the number of visitors to the state increased by just 2.2% to 28.4 million, spending grew by 4.6%, outpacing the rise in visitor numbers.
The increase in spending was driven by both higher demand and price increases across various sectors. Of the total spending, 26% came from food and beverage sales, while lodging, including hotels, second homes, and short-term rentals, contributed $1.2 billion. Air transportation saw the largest year-over-year boost, up 10.2% to $328 million. This growth is partly attributed to the opening of Breeze Airways’ permanent base at Rhode Island’s T.F. Green International Airport in March 2023, with plans to invest $160 million and create 250 jobs over five years. The airline received $2.9 million in tax credits from the state to support these job creation efforts.
The state’s marketing strategies, including a $2.2 million “All That” advertising campaign and creative promotions like a traveling giant stuffed quahog, have also played a role in boosting tourism. “The economic activity generated from the travel sector represents a critical component of the state’s current and future growth,” said Anika Kimble-Huntley, Chief Marketing Officer for Rhode Island Commerce.
Despite the record-breaking visitor numbers and spending, tourism-related employment in the state remains slightly below pre-pandemic levels. In 2023, the number of jobs directly tied to tourism stood at 38,329, about 1,000 fewer than in 2019. However, when accounting for indirect tourism-related jobs, the total climbed to 86,612, contributing $935 million in state and local tax revenue.
Commerce Secretary Liz Tanner emphasized the importance of tourism in Rhode Island’s economy, noting that it supports local businesses and enhances the state’s reputation as a top destination. Including direct spending, jobs, and tax revenue, the total economic impact of the visitor economy in 2023 reached $8.3 billion, a 4.5% increase from the previous year. The study used data from federal labor and job statistics, local tax revenues, short-term rental information, and market research from Longwoods International.
