Travel Agent NewsWage support extended but many travel agencies won’t reopen

Down on its knees, Australia’s tourism sector gets help

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Flight Centre is closing hundreds of its retail stores across Australia.
Flight Centre is closing hundreds of its retail stores across Australia. Photo Credit: Ian Jarrett

Australia’s travel industry has welcomed an extended government support package which could save thousands of jobs threatened by the coronavirus pandemic.

The federal government’s Jobkeeper wage subsidy programme – which gives employers a fortnightly payment to help with employee wages – was scheduled to run out in September but has been extended until at least March next year.

Peak industry body Tourism and Transport Forum chief executive Margy Osmond said tourism-related businesses had borne the brunt of impacts arising from business and border closures ordered by the Australian government.

She said the industry has been losing almost A$10 billion (US$7 billion) per month since Covid-19 enforced lockdowns came into place “and all this coming off the back of a catastrophic bushfire season that decimated tourism reliant destinations across the country”.

“Any eventual uptick in domestic tourism will not be sufficient to fill the A$4 billion black hole left by the lack of international inbound travel,” Osmond added.

For travel agencies, the impact of Covid-19 has been devastating with Flight Centre – Australia’s largest travel business – likely to shut hundreds of its 944 Australian stores and about 370 of its 593 stores outside Australia.

In a podcast, Flight Centre CEO Graham Turner said his toughest decision had been standing down 70% of his 20,000-strong workforce.

The industry veteran said he had faced several disasters – 9/11, the GFC, two Gulf Wars, SARS – throughout his travel career and come through them, but “nothing compares to the Covid-19 crisis”.

It was tough, he added, knowing that many of the Flight Centre stores built up over the last 38 years would never reopen. “There’re certain things you’ve just got to do and we had no alternative, it is about what you’re rebuilding for the future.”

Flight Centre rival Helloworld, meanwhile, has raised almost A$50 million from investors to help survive Covid-19.

CEO and managing director Andrew Burnes said the successful capital raising “demonstrates the market’s positive view on the long-term viability of the travel industry and their confidence in Helloworld Travel’s capacity to manage its way through the next 12 to 24 months, as the world learns to cope with and eventually eliminate Covid-19”.

Helloworld recently closed its offices in Manila and Mumbai, sold its US wholesale operation and predicts approximately 125 stores of franchisees in Australia and New Ze-land have elected to close their doors, representing five percent of the total number of stores.

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