Patterns of seasonality in employment in tourism in the UK

Abstract

Tourism employment has grown rapidly (a fact which has been of interest to policymakers concerned with job generation) but it has a marked seasonal character. Several attempts have been made by the industry to lessen seasonality in tourism demand (and hence in tourism employment) by fillng troughs. This paper uses recent advances in econometric work to investigate whether seasonality has lessened as a result of these policies, and if so, the nature of the changes in seasonality. A quarterly UK data series from 1982:1 to 1996:4 is examined. The distinction between stochastic and deterministic trend is made, and it is found that seasonality has in fact lessened and is best modelled as a break in deterministic seasonality. There has been approximately a 30% fall in the summer (second quarter) effect and approximately a 24% fall in the winter (fourth quarter) effect: thus the seasonal smoothing comes from lower hiring at the start of the peak season and lower firing at the end of the season.