Episode 121: Travel Locally to Help State Recovery

Welcome to the Workplace, a podcast by Cal Chamber. I'm Alan Zarenberg, president of the California Chamber of Commerce. Today on the podcast, we're going to discuss a critical issue for California's economy, tourism. With me on the podcast are two experts on this subject, Assembly Member Sharon Quirk Silva, who represents areas of Orange county and chairs the Assembly Committee on Arts, Entertainment, Sports and Tourism, and Carolyn Boteta, the president and CEO of Visit California. Welcome to both of you. If we can, let's kick off today's podcast by discussing the importance of tourism to California's economy. Carolyn? Assemblymember Cork Silva, either one, Jump in. Let's get going.

Well, I guess I will start, but I definitely appreciate the leadership and the support of Assemblymember Corksova because she definitely is a voice beyond her constituency in Southern California. And I know we'll get into that, Alan, the great work she's done to date as a champion of tourism. But as you said, it's a major component of the California economy. Actually, prior to Covid, we had 10 consecutive years of record growth of tourism expenditures in California totaling $145 billion. That's an incredible machine powering our economy, generating over $12 billion in state and local tax revenue and giving Californians.

1.2 million jobs. So an incredible cornerstone of the economy. And I think most importantly, and what Assemblymember Corcsilva understands is that it really powers local communities, just like her constituency, with the generation of transit occupancy tax revenue that powers our local communities.

Assemblymember Quirk Silva, maybe you could talk a little bit exactly along those lines about how significant it isn't just to California's economy, but to those communities that really depend on tourism as a major industry.

Well, yes. First, thank you for having me. I really have been very excited to take on the leadership role at the state with arts and tourism. As you know, that committee is very expansive. It also focuses on entertainment, sports, gaming, technology, and all of those industries throughout the state of California have been, of course, severely impacted. If we think back just a year ago at this time, we did not know what was ahead of us. And certainly we've seen the devastation within our communities. I represent north Orange county, which includes, of course, not only Disneyland, but Knott's Berry Farm. And we saw locally where Thousands, up to 15,000 members of our communities basically immediately were at home. And not only was it within the tourism parks themselves, Knott's Berry Farm, which is, by the way, just celebrated its 100th birthday, but Disneyland, over 60 years but it was also, of course, the hospitality industry, including hotels, restaurants, retail. So the impact is beyond what we can state as far as loss of jobs, loss of dollars to our economy. But of course we also lost individuals, many, many people who died throughout this Covid period. So we are back, we are reopening and we're quite excited.

So Carolyn, maybe you can talk a little bit about you can't go from 0 to 100 in one day. How do you get the industry back together? How do you find the right talent to work in your industry after they've been unemployed for so long? And on top of that, how do you attract business, not business people, but tourists to California, both from California and throughout the country? What's the strategy here and how do you do that?

Well, we do have some challenges, Alan, going forward. We've been able to pick up a little momentum with the governor's reopening on June 15. To date, Americans see Florida as more destination ready or ready to receive visitors in California. So that's certainly a headwind that we've got to overcome. I have to say there is a foundation in the industry of California being known and recognized nationally as an industry that works together. It's a coalition of competitors. And we in California don't see crisis as competitive. So that's going to be a major advantage as we come out of this. Doubling down on that, of course, is the leadership that Assemblymember Cork Silva mentioned along with Senator McGuire and the governor and that's putting forth stimulus dollars, a one time stimulus. I believe Assemblymember Corksova was part of those deliberations yesterday. So thank you for passing that budget out of the legislature, about $95 million to support a very robust and comprehensive.

Campaign to really encourage and get the confidence back of prospective travelers that California is indeed open for business and this industry is now rolling out the red.

Carpet to that point. Sharon, maybe you can comment on that. And along with the members of the legislature of what we have to do is convince people based on what Carolyn says is we are the right destination, we're ready for people to come to California and spend their tourism dollars.

Exactly. And I think Carolyn just mentioned campaign and a campaign is exactly what we think of. It's getting media out there, radio, tv, printed ads to say to Californians and others throughout the country come back, we're open, we need you, we want you. And to also make sure that they understand the safety protocols that will still be in place in some areas. But also that Disneyland just released, I believe yesterday that they're back at full capacity, that they're not going to require masks in certain parts of the park. So I think as we restate and we reopen, it's going to be that same dialogue that we want you back here. We've missed you and come back to our iconic places in California, from Hollywood to San Diego to Northern California. And I think all of us saying the same thing will start and again, us showing it personally, taking small trips locally, all of those things will make a big difference.

Well, I think that's really a great message for today because yes, we need to go outside the state and tell people we're ready for their business. But we have our podcast listeners here are California business people and they have a great opportunity here to support your industry, Carolyn, by staying right here in California. Right?

They do.

I'm glad you mentioned that, Alan, because first and foremost what we're trying to do and how we can be successful in shortening the recovery curve overall is for Californians to actually consider California as their holiday or vacation options. It's like a modern day act of patriotism to support your fellow Californians. And let's face it, I know they're all business people listening, but at some point they're tourists and they're bringing their families on vacation destinations and, and why not support fellow Californians? There is a bucket list item that you haven't experienced yet in California. So that is key is for us to consider California first and we will put those Californians back to work.

Well, great. To that point, like I said, you can't go from 0 to 100 in one day.

Is California open for business? I think this is a great message here that you've had some time to gear up, so to speak, to be able to be ready for your tourism business, whether they be from California. Throughout the state. Is the industry geared up and ready to receive tourists?

They absolutely. The enthusiasm is at peak right now. I think also you're referencing the workforce. So there is some challenges and headwinds around getting people back to work so that we can support the services. Hospitality is very labor intensive. So I think it'll be a process and I'm glad you said that because we can't go from 0 to 100. But we will be working to receive visitors while we're gearing up and training the workforce to get back into the operational fold.

So to that point, I don't think people look at tourism necessarily as an export, but it really is.

Especially from our international business and our international travelers. What do we need to do. We need the airlines, we need people to feel safe about coming to California. Do you have a strategy also to be able to attract foreign dollars here to California, which are.

Notwithstanding the fact that we want California to spend money here, but we also want to be able to attract foreign dollars, which is great investment in California.

I'll take a little bit of a stat. I was the former chair of our Jobs and Economic Development Committee and you know, some of our trading partners, whether it's at the border of Canada or Mexico or even China, we know that not only do we want to make sure we continue robust trading, but we also want to make it as easy as possible. One of the things I learned on as that chair of the committee is some of our Chinese friends love, love California. They love to do business here, but they also love to come to California as they believe it's one of the most beautiful places they've seen. And again, whether it's a coast or Yosemite, all of those are attracting people into our state. And I think that with this $95 million investment that we are pushing very hard to get into the budget, it will allow this type of information and campaign to be put out there that we're open. I know that I've seen some commercials already from Visit California and I'm like, I'm going down to San Diego, here I come.

Yeah, she's absolutely right, Alan, on that front. And as a matter of fact, again, this stimulus dollars that they just approved gives us the ability to go into the domestic market while the industry dollars that support our statewide branding efforts, actually, while diminished, we can now start to invest in international markets for development in the second half of this fiscal year. So spot on in terms of us being able to kind of stretch both and start to fertilize international development because of stimulus.

One of the things that I find to be a good lesson for all other industries is how closely the tourism industry works together, how united you are in your strategy and how did you accomplish that? How are they able to do that? And they speak with one voice, and when they're unhappy, they spoke with one voice. But I think now that you want to open up, they're all on board and ready to be coordinated and work together, whether you're in Monterey or San Diego or Disneyland. So how do you accomplish that, Carolyn?

Well, I would say it starts with incredible talent and leadership in this industry. And that's just not cliche. I really mean that. And they recognize that we as a collective and it's A strategy right in our global plan of work is do what the industry can't do for itself. So you see destinations and attractions. Disney and Orange county bureau marketing to San Diego travelers and the reverse. But we work together to develop those international markets. Because a prospective British traveler who stays an average of 10 days, they're an island nation. They can choose to go to continental Europe, they can go to Florida, but we all work together to get them to California. Because if they're not thinking about California, they'll never make it to Knott's Berry Farm or Disneyland or Los Angeles. And the industry understands that premise. So we're truly a coalition of competitors. But the most lucrative markets are those long haul domestic and international markets. And the industry understands better than anyone in the nation that working together, we say one plus one equals three. They can fight about how they get those travelers once they've decided on California, for example.

Great Assemblymember Quirk Silva, you touched on this in the beginning. And I think it's important to really emphasize this is the communities that you don't have to be Disneyland, but you can be nearby Disneyland and be the ones who sell the hotel rooms. You can be there near the Monterey Aquarium and provide revenues for your community. Could you talk a little bit about that and how important tourism affects more than just those attractions?

Yes. One of the things that I think that people weren't as aware of unless you're in the industry is as you would say, supply chain. So whether, for example, Disneyland has about 21 unions. So when Disneyland closes their door, all of those people are staying home. So it's not just the in park employees doing the attractions, but it's delivering the food into the park. It's the beverage industry. Of course we mentioned retail, but if you also think about entertainment in California, across the state of California, from your major studios to your large theaters and very small theaters, all of that impact, from hairdressers to costume makers to anything that comes with production, was put on hold. And so as we get back to business, those industries that really have suffered huge impacts, we are hoping that they will be able to reopen their doors. And again, we have a big ask in for 95 million for Visit California. But we also have major budget asks in for California Arts and California theaters and are even now working.

Very hard on nonprofit theaters, really trying to take all of those industries and say to not only the public, these are an important part of their creative economy throughout the state. And we need our doors open, but we also want to welcome you back so all intersectional there.

Well, great. As we come to a close of our podcast here, maybe both of you would like to make a little pitch out there to our California listeners and make sure that everybody takes advantage of all the tourist attractions here in California and spend your money close to home first.

I'll go. Go. Let's go. Let's get back to business and let's ride those rides and swim those waves and enjoy those performances because we know that California is the Golden State and let's bring back that golden element.

I'll just double down and say, calling all Californians, let's do this together.

Thank you. And we're not going to let Florida take our business away. So with your campaign working on here, we want to get the rest of the nation to come to California, spend their hard earned dollars, but above all, enjoy themselves. California tourism. Thank you so much for joining us on the Workplace Today. Please comment, share and subscribe to Kal Chambers podcast by visiting calchamber.com and thanks to Carolyn Botteta and Assembly member Sharon Cork Silva for being with us today to talk about the importance of tourism. And without tourism coming back, our economy isn't going to come back fully. So thank you all.

Thanks, Alan.

Thank you.