Final 2022 data for the International Passenger Survey (IPS) was released by the Office for National Statistics on May 26th. In 2022, the UK welcomed 31.2m inbound visits following two years of extremely low visits due to the impact of COVID-19 (down 24% vs 2019). In 2022, visitors spent £26.5bn during the 12 months of 2022, down 7% on 2019 (in nominal terms). Taking inflation into account, visitor spend was 17% below 2019 levels, equivalent to £23.5bn in 2019 prices. For more information and detailed data please visit this page.
Our latest inbound forecast for 2023 is 37.5 million visits, 92% of the 2019 level. Inbound visitors are forecast to spend £30.9 billion, 109% of the 2019 level in nominal terms although 90% in real terms (taking inflation into account).
This is an upgrade on the previous forecast, due to data for late 2022 coming in stronger than expected.
At time of writing we do not have any official inbound data from the IPS as monthly data has been temporarily suspended. However, a number of other data sources have been consulted, including publicly released total passenger numbers by each inbound transport mode as well as flight booking data; a range of forward-looking indicators (searches and bookings) have also been used to inform short term prospects.
For inbound spending, a range of factors were taken into account. Spend per visit in 2022 was well up on 2019, but in part this was due to longer average length of stay, especially in the first quarter of the year. It is assumed that length of stay will gently ease down close to normal levels throughout the year, but that a return to a more normal pattern of journey purpose will act as a source of upwards pressure on spend per visit. (Visits to friends and relatives, which have a longer average length of stay but lower spend per visit than other journey purposes, recovered faster than other journey purposes in 2022.) Inflation forecasts were factored in.
Looking longer term, the forecast is consistent with a return to pre-COVID visit volumes by the end of 2024.
A number of assumptions were made when drawing up this forecast. Crucially, it was assumed that there would be no major disruptive events (such as the return of COVID restrictions or an escalation of the Ukraine war). In terms of economic drivers, it is assumed that global cost of living pressures gradually ease throughout the rest of 2023 although not so dramatically as to trigger a significant additional boom in consumer spending. An assumption was made about the level of inbound tourism by the end of the year: slightly behind 2019 levels in the aggregate, and although journey purpose was not explicitly modelled, the working principle was for holiday volumes to recover to slightly behind 2019 levels, visits to friends and relatives (which was already at or even ahead of pre-COVID levels) unlikely to jump much further than current levels, and business visits to recover further from 2022 but still well below 2019.
We will issue a revised forecast for 2023, and a forecast for 2024, towards the end of the year.
For broader insights on inbound travellers please refer to our recent MIDAS research.