Analysis in Brief
Workforce insights: Demographics in the travel arrangement, reservation and accommodation services industries, 2017 to 2023

Acknowledgments

The author would like to thank Cael Thomas and Juliane Duchesne for their contributions to this project.

Businesses in the travel arrangement, reservation and accommodation services industries are directly influenced by economic conditions and household discretionary spending on leisure. Employment levels in these industries can be volatile, particularly during periods of financial uncertainty, such as during the COVID-19 pandemic and the recovery phase that followed.

This paper, which follows a previous three-study series,^Note  explores the demographic characteristics of employees in the Canadian travel arrangement, reservation and accommodation services industries.

This paper leverages administrative data to examine the distribution of these industries’ workforce by gender,^Note  age, full-time work status^Note  and residency status^Note  from 2017 to 2023. Results in this paper are based solely on employees who received a T4 slip from employers; they exclude self-employed workers.

The travel arrangement and reservation services industry group

The travel arrangement and reservation services industry group is composed of three main industries: travel agencies, which sell travel packages, flights, hotel bookings and other travel-related services; tour operators, which plan, organize and operate guided tours and experiences; and other travel arrangement and reservation services, which include businesses such as automobile clubs, ticket service companies and travel wholesalers.^Note  These industries are heavily dependent on tourism and travel, both of which faced significant restrictions following the onset of the COVID-19 pandemic, effectively bringing most domestic and international travel to a standstill.

Given these industries’ reliance on business and personal travel, pandemic-related closures and travel restrictions throughout most of 2020 and 2021 led to significant economic losses for them. From 2019 to 2021, total operating revenues plummeted 66.6% for travel agencies, 89.8% for tour operators, and 42.6% for other travel arrangement and reservation services.^Note  Employment in the travel arrangement and reservation services industry group reached its lowest point in July 2021, down over 40% compared with July 2019.^Note  Because of the extent of the revenue declines and employment losses in tourism-related industries, the 2021 federal budget featured targeted supports—including the $500 million Tourism Relief Fund—to directly support businesses and destinations in the tourism industry, in addition to many other broader initiatives to support small and medium-sized enterprises and travel.^Note 

Although the travel arrangement and reservation services industry group began to recover from pandemic closures in 2022, revenues did not fully return to pre-pandemic levels until 2023.^Note  While operating revenues surpassed pre-pandemic levels, it was partly driven by rapid price increases in the industry. Prices rose 13.1% from 2022 to 2023 for travel tours.^Note  However, the volume of activity had not fully recovered, and employment levels were 14.7% below pre-pandemic levels as of 2023.^Note 

Workforce trends in travel arrangement and reservation services

Across all years of the study, women accounted for an average of 58.3% of employees in the travel arrangement and reservation services industry group. This proportion has declined slightly over the years, from 59.5% in 2017 to 57.2% in 2023. However, all three industries had uneven gender splits across the years. The gender disparity was most evident in travel agencies, where three-quarters of employees were women, on average. Tour operators had a similar disparity, although to a lesser extent, with women representing just over 60% of the workforce, on average. Conversely, women made up less than half (43.2% on average) of employees in other travel arrangement and reservation services.  

In terms of the age distribution in this industry group, core-aged workers (25 to 54 years) made up 63.7% of the workforce in travel arrangement and reservation services in 2023. This is a smaller proportion of core-aged workers compared with the overall Canadian workforce (65.5%).^Note  The difference is attributable to the relatively large share of workers aged 55 and older in the industry group (24.2%). However, this breakdown was not consistent across the industries. In 2023, people working in travel agencies tended to be older—employees aged 55 to 64 made up the largest share of the workforce (21.8%) and employees aged 65 and older made up just over 10%. By contrast, tour operators employed a relatively younger workforce, with people younger than 35 representing about 45.6% of employees in 2023. The age distribution of other travel arrangement and reservation services was quite similar to that of tour operators.

Because of the seasonal nature of the travel and tourism sector, businesses operating in the travel arrangement and reservation services industries rely heavily on part-time employment. This trend accelerated throughout the COVID-19 pandemic, with the proportion of part-time employees increasing from 54.8% in 2019 to a high of 69.0% in 2021 (Chart 1). However, as pandemic related restrictions eased and work returned to normal, the share of part-time workers employed in the industry returned to pre-pandemic levels in 2023.

Data table for Chart 1

Data table for Chart 1
Table summary
This table displays the results of Data table for Chart 1 Full time and Part time, calculated using percent units of measure (appearing as column headers).

	Full time	Part time
	percent
Sources: Statistics Canada, Business Register and administrative data, custom tabulations.
2017	44.0	56.0
2018	42.5	57.5
2019	45.2	54.8
2020	34.5	65.5
2021	31.0	69.0
2022	41.0	59.0
2023	42.3	57.7

Non-permanent residents made up an increasing share of the workforce in the travel arrangement and reservation services industry group in recent years (Table 3). The proportion of non-permanent residents rose to 8.1% in 2023, the highest share since 2017. This increase coincided with strong growth in the number of non-permanent residents entering the Canadian economy throughout 2022 and 2023, the majority of whom were temporary workers responding to labour market needs.^Note 

The accommodation services subsector

The accommodation services subsector is composed of two industry groups. The first is hotels, motor hotels and motels,^Note  which also includes private short-term rentals, and the second is other accommodation industries,^Note  which includes bed and breakfasts and campgrounds, among other accommodations. Because of the varying nature of these industries and their ability to adapt to shifting regulations, they experienced significantly different outcomes during the COVID-19 pandemic.

The hotels, motor hotels and motels industry was among the hardest hit in Canada throughout the pandemic. Being heavily reliant on tourism and business travel, businesses in this industry faced notable challenges, because of the travel restrictions that were imposed, resulting in widespread cancellations of travel, large events and conferences in 2020 and 2021. Operating revenues in the industry plunged 41.0% in 2020 and saw little recovery in 2021, remaining 34.0% below 2019 levels.^Note  During this period, the federal government introduced various support measures, including subsidies and programs such as the Canada Emergency Wage Subsidy.^Note  As a result, the operating profit margin in the industry remained positive throughout the pandemic.

While the pandemic-related restrictions on travel had immediate negative effects on the industry, it experienced a swift recovery once the restrictions were lifted. Revenues returned to pre-pandemic levels in 2022, boosting the operating profit margin to 18.8%, the highest level recorded since comparable data became available in 2012. In 2023, the operating profit margin continued to climb, reaching 20.0%.^Note  This increase was partly attributable to pent-up demand for accommodations since the start of the pandemic and the closure of many struggling businesses during that period, leaving more profitable businesses in operation and enabling greater flexibility in pricing.

The other accommodation industries category consists of outdoor or otherwise isolated accommodations and workforce lodging companies. Workforce lodging companies provide accommodations at isolated resource extraction operations and make up a significant portion of business activity in the industry.^Note  These companies were affected by the pandemic to a lesser extent, as operations allowed them to remain functional for much of the health crisis. Consequently, this industry experienced a relatively smaller dip in revenues (-17.9%) in 2020 before bouncing back to pre-pandemic levels in 2021. Operating profit margins also remained largely unaffected during the pandemic.

Revenues in the accommodation services subsector were well above pre-pandemic levels in 2023; however, employment levels had only returned to 95% of pre-pandemic levels seen in 2019.^Note  This could partially be attributable to several factors, including difficulties filling vacant positions and businesses capitalizing on technological efficiencies, such as self-check-in systems and online booking platforms. Leveraging these innovations can allow businesses to operate with fewer employees, potentially contributing to the rise in profit margins observed in the subsector.

Labour market insights in accommodation services

In accommodation services, the gender distribution was consistent across industries, with women making up the majority of the workforce in the subsector. Over the years studied, this trend persisted, with the proportions of employees remaining stable within both industry groups in the subsector.

The accommodation services subsector also relies heavily on part-time workers (Table 5). Part-time workers consistently made up close to three-quarters of the workforce across these industries. The hotels, motor hotels and motels industry experienced a short-lived uptick in the share of part-time employment early in the COVID-19 pandemic as employers looked to reduce full-time staff during periods of reduced business activity. However, as of 2023, the proportion of full-time employees had returned to slightly above pre-pandemic levels. The other accommodation industries category, unlike all other industries examined in this paper, did not experience a decrease in the proportion of workers employed full time during the pandemic.

The accommodation services subsector has a relatively young workforce, with over half of all employees younger than 35. In hotels, motor hotels and motels, the largest share of employees was in the 25-to-34 age group, which made up 26.5% of the workforce. The workforce in other accommodation industries was slightly younger, with 56.6% younger than 35 and 29.2% in the 18-to-24 age cohort, while those younger than 18 made up close to 5% of the workforce.

Following the onset of the COVID-19 pandemic, workforce shortages emerged as an important challenge for the accommodation services subsector. With a significant number of employees displaced by the pandemic opting not to return to the hospitality industry, combined with rebounding demand for accommodation services as pandemic-related restrictions were eased or removed, job vacancy rates in the subsector soared throughout 2021. As demand for accommodation services rebounded in 2021 and 2022, job vacancy rates in the sector peaked at 14.0% in 2021 and 12.3% in early 2022.^Note  During this period, non-permanent residents became a larger part of the accommodation services subsector workforce, reaching 15.8% of the workforce by 2023, compared with 8.9% in 2019 (Table 7). The increasing reliance on non-resident employees in 2022 and 2023 eased labour pressures and contributed to a lower job vacancy rate in the sector, which fell to 4.2% in 2023.

Conclusion

While the COVID-19 pandemic was a big shock to the travel arrangement, reservation and accommodation services industries, leading to significant economic and employment losses, the distribution of these industries’ workforce by gender, age and full-time work status did not vary meaningfully from 2017 to 2023, for the most part. However, the residency status of the workforce changed during and after the pandemic, with a greater reliance on non-permanent residents, including international students, temporary foreign workers, and others who are not Canadian citizens or permanent residents, as a result of their increased availability in the labour supply. Furthermore, most industries in the study have yet to regain pre-pandemic employment levels, despite a complete financial recovery.

Moving forward, these industries will face growing challenges caused by an aging population and increasing economic uncertainty. As a result, competition to attract and retain workers will intensify, potentially leading to labour cost pressures and further strains in the travel and accommodation sector. However, recent empirical analysis^Note  shows that employees in industries such as accommodation and food services face relatively lower exposure to artificial intelligence-related job transformation and downsizing.

Finally, with Canada’s economic relationship with the United States changing and other economic headwinds stirring, revenue, profitability and hiring strategies could be affected. While demographic and hiring challenges loom large, these economic pressures further compound the uncertainties facing the sector.