Pre- and Post-pandemic Analysis of Portugal’s Accommodation and Food Services Sector: a Shift-Share Approach

Alcina  NUNES; Jéssica  ALVES

doi:10.24193/subbnegotia.2024.3.01

Authors

Alcina NUNES UNIAG, Instituto Politécnico de Bragança, Portugal. Email: alcina@ipb.pt. https://orcid.org/0000-0003-4056-9747
Jéssica ALVES UNIAG, Instituto Politécnico de Bragança, Portugal. Email: jessicaalves@ipb.pt. https://orcid.org/0000-0001-6443-2732

DOI:

https://doi.org/10.24193/subbnegotia.2024.3.01

Keywords:

business dynamics, accommodation, food services sector, tourism, shift-share analysis, Portugal

Abstract

Portugal’s tourism industry is essential to the nation’s economy, significantly contributing to wealth creation and employment opportunities. However, the onset of the global COVID-19 pandemic in 2020 severely impacted this vital sector. The accommodation and food services were particularly hit, with many businesses facing widespread closures. By early 2022, Portugal’s economy faced additional hurdles. Geopolitical tensions and rising inflation created further disruptions on a global scale, complicating the recovery process. Despite these obstacles, Portugal’s accommodation and food services sector began to show promising signs of recovery. To gain a deeper understanding of these dynamics, this paper utilizes shift-share analysis to examine the post-pandemic business landscape of Portugal’s accommodation and food services sector, focusing on data from 2019 to 2022 for active businesses and the number of persons employed. This analytical method breaks down growth into national, sectoral, and regional components, providing a comprehensive view of the factors influencing recovery. The findings indicate that regional and industrial factors played a more significant role in driving recovery than national economic trends alone. Notably, regions such as the Algarve, Madeira, and Açores demonstrated remarkable resilience and growth. These areas benefited from their unique competitive advantages within the sector, which helped them navigate the challenging post-pandemic environment more effectively. The study’s insights are invaluable for policymakers and investors. By understanding the importance of regional policies and innovation, stakeholders can make targeted decisions that enhance the sector’s competitiveness and sustainability.

JEL classification: L83, R11, Z30

Article History: Received: May 24, 2024; Reviewed: July 31, 2024;
Accepted: September 17, 2024; Available online: September 23, 2024.

References

Afonso, V. & Calisto, M.L. (2023). Covid-19 and the Portuguese accommodation sector. European Journal of Tourism, Hospitality and Recreation, 13(1), 49-55. https://doi.org/10.2478/ejthr-2023-0005

Artige, L. & van Neuss, L. (2014). A new shift-share method. Growth and Change, 45(4), 667–683, https://doi.org/10.1111/grow.12065

Benítez-Aurioles, B. (2020). Tourism resilience patterns in Southern Europe. Tourism Analysis, 25(4), 409-424. https://doi.org/10.3727/108354220X16010020096118.

Benítez-Aurioles, B. (2022). Análisis regional del mercado peer-to-peer de alojamientos turístico en España durante la pandemia. ROTUR. Revista de Ocio y Turismo, 16(2), 112-134. https://doi.org/10.17979/rotur.2022.16.2.8889.

Broxterman, D.A. & Larson, W.D. (2020). An empirical examination of shift-share instruments. Journal of Regional Science, 60(4), 677-711. https://doi.org/10.1111/jors.12481.

Cheng, S. (2011). Business cycle, industrial composition, or regional advantage? A decomposition analysis of new firm formation in the United States. Annals of Regional Science, 47(1), 147–167. https://doi.org/10.1007/s00168-009-0361-0.

Colmekcioglu, N., Dineva, D. & Lu, X. (2022). “Building back better”: the impact of the COVID-19 pandemic on the resilience of the hospitality and tourism industries. International Journal of Contemporary Hospitality Management, 34(11), 4103-4122. https://doi.org/10.1108/IJCHM-12-2021-1509

Costantino, S., Cracolici, M.F. & Piacentino, D. (2021). A new spatial shift-share decomposition: An application to tourism competitiveness in Italian regions. Geographical analysis, 53(4), 708-735. https://doi.org/10.1111/gean.12262

Dogru, T. & Sirakaya-Turk, E. (2017). Engines of tourism’s growth: an examination of efficacy of shift-share regression analysis in South Carolina. Tourism Management, 58, 205–214, https://doi.org/10.1016/j.tourman.2016.10.021.

Dogru, T., Suess, C., & Sirakaya-Turk, E. (2021). Why do some countries prosper more in tourism than others? Global competitiveness of tourism development. Journal of Hospitality & Tourism Research, 45(1), 215-256. https://doi.org/10.1177/1096348020911706.

Dogru, T., McGinley, S., Sharma, A., Isık, C. & Hanks, L. (2023). Employee turnover dynamics in the hospitality industry vs. The overall economy. Tourism Management, 99, 104783. https://doi.org/10.1016/j.tourman.2023.104783.

Dunn, E. S. (1960). A statistical and analytical technique for regional analysis. Papers and Proceedings of the Regional Science Association, 6(1), 97–112. https://doi.org/10.1111/j.1435-5597.1960.tb01705.x.

Esteban, J. (2000). Regional convergence in Europe and the industry mix: a shift-share analysis. Regional Science and Urban Economics, 30(3), 353–364. https://doi.org/10.1016/ S01660462(00)00035-1.

Fernando, I.N. (2020). Tourism competitiveness by shift-share analysis to way-forward Destination Management: A case study for Sri Lanka. Journal of Tourism and Services, 11(21), 88-102. https://doi.org/10.29036/jots.v11i21.139

Goschin, Z. (2014). Regional growth in Romania after its accession to EU: a shift-share analysis approach. Procedia Economics and Finance, 15, 169–175. https://doi.org/ 10.1016/S2212-5671(14)00471-7.

Huang, S.S. & Wang, X. (2023). COVID-19 two years on: a review of COVID-19-related empirical research in major tourism and hospitality journals. International Journal of Contemporary Hospitality Management, 35(2), 743-764. https://doi.org/10.1108/IJCHM-03-2022-0393.

INE, 2024. INE, Demografia das empresas. [Online]. Available at https://www.ine.pt/xportal/xmain?xpid=INE&xpgid=ine_base_dados.

Irving, J., Waters, K., Clower, T. & Rifkin, W. (2023). Pandemic regional recovery index: An adaptable tool for decision-making on regions. In Celbiş, M.G., Kourtit, K., Nijkamp, P. (Eds) Pandemic and the City. Footprints of Regional Science. Springer, Cham. 237-260. https://doi.org/10.1007/978-3-031-21983-2_13.

Jesus, E. (2023). Madeira tourism—always proactive toward sustainability. Worldwide Hospitality and Tourism Themes, 15(6), 664-668. https://doi.org/10.1108/WHATT-09-2023-0114.

Kemeny, T., & Storper, M., (2014). Is Specialization good for regional economic development? Regional Studies, 49(6), 1003–1018. https://doi.org/10.1080/00343404.2014.899691.

Krabokoukis, T. & Polyzos, S. (2021). Spatial inequalities of tourist activity in Greece: a shift-share analysis. Anatolia, 32(1), 93-105. https://doi.org/10.1080/13032917.2020.1851271.

Lopes, A.S., Sargento, A. & Carreira, P. (2021). Vulnerability to COVID-19 unemployment in the Portuguese tourism and hospitality industry. International Journal of Contemporary Hospitality Management, 33(5), 1850-1869. https://doi.org/10.1108/IJCHM-11-2020-1345.

Martins, P. & Correia, A. (2024). Beyond sun and sand: How the Algarve Region is pioneering innovative sustainable practices in tourism. In Pechlaner, H., Innerhofer, E., & Philipp, J. (Eds.) From Overtourism to Sustainability Governance: A New Tourism Era. Routledge. 47-58. https://doi.org/10.4324/9781003365815_8.

Nyagadza, B., Chigora, F., Pashapa, R., Chuchu, T., Maeeresa, W. & Katsande, C. (2022). Effects of COVID-19 on tourism and hospitality: Exploring the new normal. In Mohanty, P., Sharma, A., Kennell, J. & Hassan, A. (Eds.) The Emerald Handbook of Destination Recovery in Tourism and Hospitality, Emerald Publishing Limited. 11-21. https://doi.org/10.1108/978-1-80262-073-320221002.

Provenzano, D. & Baggio, R. (2020). Quantitative methods in tourism and hospitality: a perspective article. Tourism Review, 75(1), 24-28. https://doi.org/10.1108/TR-07-2019-0281.

Rodríguez-Antón, J.M. & Alonso-Almeida, M.M. (2020). COVID-19 impacts and recovery strategies: The case of the hospitality industry in Spain. Sustainability, 12(20), 8599. https://doi.org/10.3390/su12208599.

Samora-Arvela, A., Pinto, P., Panagopoulos, T., Vaz, E., Ferreira, J., Pina, H. & Pinto, D.M. (2024). Regional resilience and dependence on tourism in a changing climate. In Remoaldo, P., Lopes, H., Ribeiro, V., Alves, J. (Eds.), Tourism and Climate Change in the 21st Century. Advances in Spatial Science. Springer. 117-142. https://doi.org/10.1007/978-3-031-59431-1_6.

Sanabria-Díaz, J.M., Aguiar-Quintana, T. & Araujo-Cabrera, Y. (2021). Public strategies to rescue the hospitality industry following the impact of COVID-19: A case study of the European Union. International Journal of Hospitality Management, 97, 1029988. https://doi.org/10.1016/j.ijhm.2021.102988.

Santos, L.D. & Vieira, A.C. (2020). Tourism and regional development: a spatial econometric model for Portugal at municipal level. Portuguese Economic Journal, 19, 285–299. https://doi.org/10.1007/s10258-020-00179-z.

Saputra, P.M.A. (2023). COVID-19 and tourism industry: An investigation of spatial dependence in Europe. Cogent Social Sciences, 9(2). https://doi.org/10.1080/23311886.2023.2282413.

Sargento, A. & Lopes, A.S. (2024). Territorial resilience on the aftermaths of COVID‐19 crisis - An exploratory analysis on the role of innovation. Regional Science Policy & Practice, 16(1), 12697. https://doi.org/10.1111/rsp3.12697

Seyitoğlu, F., Costa, C., Martins, M. & Malta, A.M. (2023). The future of tourism and hospitality labour: challenges, requirements, trends, skills and the impact of technology. Current Issues in Tourism, 1–15. https://doi.org/10.1080/13683500.2023.2286291.

Sobaih, A.E.E., Elshaer, I., Hasanein, A.M. & Abdelaziz, A.S. (2021). Responses to COVID-19: The role of performance in the relationship between small hospitality enterprises’ resilience and sustainable tourism development. International Journal of Hospitality Management, 94, 102824. https://doi.org/10.1016/j.ijhm.2020.102824.

Sousa, Á., Macedo, B., Couto, G. & Castanho, R.A. (2023). Effects of COVID-19 on the Tourism Sector: Learning from the Azores Islands. Sustainability, 15(18), 13339. https://doi.org/10.3390/su151813339.

Tunio, M.N., Yusrini, L., Shah, Z.A., Katper, N. & Jariko, M.A. (2021). How hotel industry cope up with the COVID-19: An SME Perspective. Etikonomi, 20(2), 213-224. https://doi.org/10.15408/etk.v20i2.19172.

Turismo de Portugal (2024). O Turismo em Portugal: Factos e Números. [Online] Available at: https://www.turismodeportugal.pt/pt/quem_somos/Organizacao/information-hub-mne/Paginas/turismo-em-portugal-factos-e-numeros.aspx.

Utkarsh & Sigala, M. (2021). A bibliometric review of research on COVID-19 and tourism: Reflections for moving forward. Tourism Management Perspectives, 40, 100912. https://doi.org/10.1016/j.tmp.2021.100912.

Wheeler, J.O. (2005). Geography. In Kempf-Leonard, K. (Ed). Encyclopedia of Social Measurement. Elsevier. 115-123. https://doi.org/10.1016/B0-12-369398-5/00277-2.

World Travel & Tourism Council [WTTC] (2023). Economic Impact Report 2023: Global Trends. [Online] Available at https://researchhub.wttc.org/product/economic-impact-report-2023-global-trends.

Yasin, M., Alavi, J., Sobral, F. & Lisboa, J. (2004). A shift-share analysis approach to understanding the dynamic of the Portuguese tourism market. Journal of Travel & Tourism Marketing, 17(4), 11-22. https://doi.org/10.1300/J073v17n04_02.

Ye, H., Chan, I.C.C. & Law, R. (2023). A systematic review of initial COVID-19 research in tourism and hospitality. Tourism Analysis, 28(1), 125-141. https://doi.org/10.3727/108354222X16630748399737.