Czech Tourism Rebounded In Q2 Amid Reopening

Tourism in the Czech Republic revived in the second quarter after the lifting of restrictions against the spread of covid-19, and revenues from service providers also increased year on year, most notably in sectors related to tourism. In the given period, 1.6 million guests were accommodated in hotels, boarding houses, and campsites, which was 51.3 percent more year-on-year. Revenues in services increased year-on-year without adjustments by 14.8 percent. For example, hoteliers are saved mainly by domestic guests. However, the restart of activity in services had a positive effect on the labor market, where the number of vacancies rose to current highs. The unemployment rate alone stagnated at 3.7 percent in June. This resulted from data published today by the Czech Statistical Office (CSO), the Labor Office, and the statements of analysts.

According to the CZSO, the number of visitors to collective accommodation establishments reached positive numbers after five quarters. Compared to 2019, ie before the pandemic, it still does not reach even a third of the volume of visits. However, according to analysts contacted by ČTK, the recovery of tourism after the spring closure is faster than last year. However, an increase in the number of guests by tens of percent is not enough to restore tourism, which has suffered significantly from anti-epidemic measures. There are no foreign tourists, analysts agreed.

From April to the end of June, 1.3 million domestic tourists used the services of accommodation establishments this year, 47 percent more than a year ago. The number of visitors from abroad rose by 79 percent year on year to 230,000. At the same time, the number of overnight stays increased by 56.1 percent to 4.2 million nights.

The number of accommodated guests increased year-on-year in all regions. Most in Prague and the Karlovy Vary region, where there was an increase of 90, respectively. 72 percent. However, the director of the state agency CzechTourism, Jan Herget, reminded that Prague is at the top mainly thanks to domestic tourists, who made up over 60 percent of visitors. According to the chief economist of BH Securities Štěpán Křeček, despite the increase in the number of accommodated guests, it is clear that this year the accommodation facility is not developing well, while the worst situation is in Prague, which is dependent on guests from abroad. On the other hand, the situation outside the capital looks better. “Regional accommodation facilities are more dependent on Czech clients, who showed a greater degree of stability in a pandemic than foreign guests,” he said.

According to the CZSO, revenues in services last increased year-on-year in the third quarter of 2019. In the second quarter of this year, after adjusting for calendar effects, they were 13.8 percent higher year-on-year and up 3.4 percent at constant prices. However, ČSOB analyst Petr Dufek pointed out that due to last year’s low comparison base, the revival of services is better than the results for the entire second quarter shown by sales in June. “As expected, HORECA (accommodation and catering) has finally started, with sales up 7.2 percent from the previous month due to the reopening of hotels. The opening of hotels and restaurants has helped the sector bounce back, but there is no question of capacity filling. “he said. He added that the accommodation has only about half the sales compared to June 2019, restaurants are not even two-thirds.

For the entire second quarter, sales to hoteliers and inns increased by a third, in the transport and storage sector they increased by a quarter, while air transport more than doubled. However, sales growth was most pronounced for travel agencies and offices, which accounted for 402.4 percent more than in the second quarter of last year.

However, the recovery of the Czech economy after the closure has had a positive effect on the labor market, and according to analysts, companies have a problem finding employees. With this in mind, they do not expect unemployment to rise in the coming months. At the end of July, employers offered 358,152 jobs through employment offices, which was 2,540 more than in June and 23,869 more than a year ago. According to Deloitte analyst David Mark, the number of vacancies has reached its highest value so far.

“While by default July is usually one of the weaker months of the year, this time the influx of new graduates into the labor market did not manifest itself. At the same time, according to him, a large part of the foreign workforce, which has not yet returned after a pandemic flight, is still missing in the Czech Republic.

Among the regions, the highest share of the unemployed was in the first holiday month in the Ústí nad Labem and Moravian-Silesian regions, both 5.5 percent. On the other hand, the lowest unemployment rate of 2.3 percent remained in the Pardubice Region.

Today, the CZSO also published information on domestic meat production in the second quarter. Due to last year’s low base effect, when production in the first wave of the coronavirus pandemic decreased, it increased by 4.3 percent year on year to 116,277 tons. The production of pork, beef, and poultry increased. If the development of meat production were compared with the period before the pandemic, growth for the second quarter of this year would be lower, according to the CZSO.