Latest Developments in the Canadian Economic Accounts
The 2020 to 2023 revisions of the National Tourism Indicators

1. Introduction

With the release of the fourth quarter 2023 estimates of the National Tourism Indicators (NTI) in March 2024, data were updated from the first quarter of 2020 to the third quarter of 2023 to align with the latest Canadian System of Macroeconomic Accounts (CSMA) annual updates. Estimates for all of 2023, including the fourth quarter, were subsequently updated with the release of the NTI first quarter of 2024 estimates in June 2024. This article outlines the impact of the updated data from the Canadian System of Macroeconomic Accounts that was introduced during this last revision of the NTI.

Between 2020 and 2023, tourism spending in nominal terms was revised down for all years except 2022. Estimates were revised down by $1.5 billion in 2020, $1.1 billion in 2021 and $0.4 billion in 2023, and up by $2.2 billion in 2022.

On a quarterly basis, between the first quarter of 2020 and the fourth quarter of 2023, growth in tourism spending (in real terms) was within 1.5 percentage points of the previously published estimates in all but three quarters (see Table 1.2). Overall, revisions to growth were generally larger than usual, as benchmarking to the first pandemic-era supply and use tables may have led to larger revisions to source data.

2. Sources of revisions

These revisions to the NTI came from new and updated indicators from the CSMA, and indirectly from integration of the 2020 Supply and Use Tables (SUT). These revisions are described below.

2.1 Revisions to the Canadian System of Macroeconomic Accounts

Integration of the regular, annual updates to household final consumption expenditure, to gross domestic product (GDP) by industry, and to the balance of payments for the reference period 2020 to 2022 (released in November 2023) resulted in quarterly updates to NTI estimates for this period. Revisions to the same accounts for 2023 released in May 2024 also led to quarterly updates to the NTI.

As a result of these revisions, new benchmark information from other sources, notably the Survey of Household Spending, as well as transportation, food services and drinking places and accommodation industry surveys, were incorporated into the NTI indirectly. This affected the NTI quarterly movements and annual levels for all open years (2020 to 2023).

2.2 Supply and Use Tables, 2020

The 2020 SUT benchmarks released in November 2023 were used to benchmark indicators throughout the CSMA, leading to revisions to quarterly supply, demand, GDP and jobs of the NTI from the first quarter of 2020 to the fourth quarter of 2023.

2.3 Re-basing price and volume estimates to reference year 2017

All NTI price and volume estimates were updated to reference year 2017 (2017=100), leading to revisions to real tourism supply, demand and GDP, as well as to tourism implicit price indices. The change in reference year affected the levels but not the overall trend or growth rates of the series (aside from rounding differences), as it is essentially a rescaling of already published data.

3. Impact of updated source data on the National Tourism Indicators, 2020 to 2023

3.1 Tourism demand (nominal terms)

On an annual basis, components of tourism demand (in nominal terms) were generally revised down. Accommodation, food and beverage services, and other tourism goods and services (e.g., recreation and entertainment, pre-trip expenses and travel services) were revised down in each of the four years open to revisions. Spending on transportation was revised up in every year except 2023, while spending on other goods and services (e.g., groceries, alcohol bought in stores and urban transit) were revised up in every year (see Table 2).

The $2.2-billion overall upward revision in 2022 was mostly the result of transportation, which was revised up $3.0 billion. Spending on other goods and services was also revised up (+0.7 billion), while all other components were revised down in 2022.

3.2 Tourism demand (growth rates in real terms)

Revisions to annual growth rates of tourism spending (in real terms) were moderate in 2020 (-1.1 percentage point), 2021 (+1.2 percentage point) and 2023 (-0.3 percentage point), while 2022 was revised up 5.4 percentage points (see Table 3). Upward revisions to growth in 2022 were widespread, ranging from +3.5 percentage points (transportation and other goods and services) to +10.0 percentage points (food and beverage services).

3.3 Jobs generated by tourism demand

Tourism jobs were revised down in all years (see Table 4). The largest revision to tourism jobs was in 2020, from 500,300 to 482,800. The downward revisions in 2020 were spread out across all tourism industries.

In 2023, tourism jobs were revised down 0.2%, with downward revisions in accommodation, food and beverage services and other tourism industries offsetting upward revisions in transportation and other industries.

Growth was revised down 2.5 percentage points in 2020 and 0.2 percentage points in 2023, while it was revised up 2.0 percentage points in 2021 and 1.3 percentage points in 2022.

3.4 Tourism gross domestic product (growth rates in real terms)

Tourism GDP annual growth rates were revised upwards in all years excluding 2020, which was revised down 1.3 percentage points (see Table 6). Between 2021 and 2023, growth in tourism GDP was revised up an average of 0.4 percentage points.

In 2020, growth was revised down in transportation (-4.1 percentage points), food and beverage services (-5.7 percentage points) and other industries (-1.7 percentage points).

4. National Tourism Indicators revision policy

The NTI revision policy allows for regular incorporation of new and updated data, including regular benchmarking to the Provincial and Territorial Tourism Satellite Account (PTTSA). Revisions to the NTI are the result of new or updated data in the core economic accounts. The revision policy serves to improve the reliability and accuracy of the NTI time series estimates. It is consistent with the policy followed for the CSMA, which governs four types of revisions: current, annual, comprehensive, and updating to a new base year (currently 2017). Each of these are described below.

During the current reference year, estimates for any quarter are subject to revision at any subsequent quarter within the same year. For instance, a first-quarter estimate is revised on the release of the second, third, and fourth quarter estimates for the same year. These are called current revisions and allow improvements to the estimates through the incorporation of the most up-to-date information available (including updates to source data as a result of late reporting).

At the time of first and fourth quarter releases of the NTI, all estimates for a given number of years preceding the current year are subject to revision. These annual revisions allow for the incorporation of the most up-to-date information from censuses, annual surveys, taxation statistics, public accounts, and other sources, which may become available well after the fact. The number of years open to revision mirror the CSMA revision for that year. Furthermore, when a new set of PTTSA benchmarks is incorporated into the NTI, the revision period is extended back to the reference year of the PTTSA. Thus, the window for revisions in the NTI varies according to the frequency of PTTSA updates and any updates to standard macroeconomic indicators in that year.

Estimates are also subject to periodic comprehensive revisions mainly to introduce new concepts, implement refined methods, and incorporate newly available data sources. Comprehensive revisions typically result in changes to the entire time series.

Updating of estimates in real terms to a new reference year (currently 2017), as with the fourth quarter 2023 release of the NTI, is normally carried out every five years. Updating of constant price series is done to remove bias in measures of inflation-adjusted growth as relative prices in the economy evolve away from those of the base year. Updating of constant price series involves updates to only the price indices and therefore, constant price aggregates, leaving aggregates at current prices unaffected.

Additional information on the revision timelines for Canada’s GDP is available in Revisions to Canada’s GDP.