Drug heat, winter chill drive up Jamaica's tourism numbers

Dionne Rose, Business Reporter

A series of winter storms in the United States and the United Kingdom, and a fallout in tourism numbers from rising drug heat in nearby Mexico have seen Jamaica's tourism industry starting off with a bumper winter season.

Hotel magnate Gordon 'Butch' Stewart told Sunday Business that the fallout has resulted in one of the best Januarys for business he has seen in Jamaica. And some hotel operators are reporting that they have increased the numbers they normally employ to handle the uptick in business.

Secrets Resorts and Spa in Montego Bay, which is recruiting an additional 50 persons to fill both executive and non-management positions, says it needs the additional resources to handle higher occupancy levels.

"We are very happy," said general manager Emilio Huhn, who said the hotel is at 100 per cent occupancy right now, and that future business was just as bright.

"Advance bookings are looking well for the summer," he said, pointing out that Jamaica was also benefiting from Mexico's misfortune due to that country's ongoing and escalating problem with drug violence.

Paying off

The 700-room hotels - Secrets Wild Orchid and Secrets St James - opened in May last year, and according to Huhn, have been doing well enough their expand their staff complements.

"Everything is paying off," he said, referring to the hard work the staff has put in at the hotels.

Wayne Cummings, president of the Jamaica Hotel & Tourist Association (JHTA), said occupancy level was up and some hotels had been hiring to meet the occupancy demand.

"Certainly from the occupancy level, the numbers are up," he told Sunday Business. "Occupancy level is strong, and yes, people are hiring to meet the occupancy."

Cummings said this winter is much better by far than last winter.

"Last year, I think the winter was short-lived. What we see this year is that we had early winter storms in the United States and the United Kingdom, and the hotels benefited from this," he said.

Better winter season

Stewart agreed with Cummings and Huhn that this winter was better than last year's.

"We have had the best January ever and the rest of the winter season seems excellent. From the Sandals perspective, a lot of work has been done for the product and in the marketplace," said Stewart via email to Sunday Business.

He, too, credited tourism's good performance to drug heat in Mexico.

"Fortunately or unfortunately, depending on the side we look at, we may be benefiting from some of the business that is bypassing Mexico, given the problems there," he said.

Stewart, while not providing numbers, suggested more jobs would have been created.

"We do not have exact figures at hand, however, we continue to have the largest payroll in Jamaica's tourism sector," he said, in response to questions on hiring.

"We are also the largest foreign-exchange earner in tourism and the overall private sector. All staff in the industry have reached out in an enthusiastic and professional manner, radiating the kind warmth that welcomes people," he added.

Tourism Minister Edmund Bartlett released data a week ago showing that since the season started on December 15, Jamaica has had 311,210 visitors, which represents an increase of 9.2 per cent over the comparative 2009-10 period.

In comparison to arrival patterns over the past few years, Bartlett said the growth for this season represents a 14.8 per cent increase over 2008-09, 15.7 per cent over 2007-08, and a 22.8 per cent increase over 2006-07 numbers.

Still, Cummings, who manages one of the hotels in the Sandals chain, said that while winter tourism was doing well, discounting still continued at an average of 30 to 35 per cent.

"Consumers are not changing, they are not in the mood" to pay premium rates, he said.

Checks on the Sandals website indicate that the chain was still offering up to 65 per cent discounting.

Discounting prices

"The entire industry is discounting in the form of value added and also in straight pricing," said Stewart when asked about pricing.

"Our net rates are the single highest in the all- inclusive category. We have more services, and that reflects why we have been voted the world's best for so many years in a row."

Asked whether the industry had found itself in a position where discounted prices had become the new normal, Cummings said the accommodation sector could only return to normal rates if it added new products and did plant upgrades, and if consumer confidence returned in the US.

"It is consumer confidence that is keeping the rates low," he said. "The jobless growth in the US plays a major role."

Bartlett said earnings for the winter period so far were US$209 million, a 7.5 per cent increase over last year when tourism flows were just over US$196 million.

dionne.rose @gleanerjm.com