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NJBIZ
Summer season on the Jersey Shore inspires mostly sunny economic forecast
By Kimberly Redmond,
2024-05-24
Ahead of summer’s unofficial start Memorial Day weekend, local officials and economic experts are mainly sunny in their seasonal forecast for businesses at the Jersey Shore.
During a May 8 panel sponsored by the Lloyd D. Levenson Institute of Gaming, Hospitality and Tourism at Stockton University School of Business, Oliver Cooke, an associate economics professor, said, “I’m cautiously optimistic for the summer.”
Cooke, also editor of the South Jersey Economic Review, went on to say, “Job growth right now has kind of picked up over the first quarter for Atlantic City proper, relative to where we were in late 2023. Unemployment remains very, very low. My sense is that we’re in a pretty decent place with all the headline metrics.”
“My general take on last summer was that it was pretty, pretty decent, certainly, in Cape May from what I know off the top of my head in terms of tax and hotel motel tax revenue. Hiring in terms of leisure and hospitality employment last summer was up. So, perhaps not as robust, in some areas, as 2022 was. My general sense is that we're still in a pretty, pretty robust economic environment right now,” Cooke added.
On the rebound
Gary Musich is vice president of sales and destination services for Visit Atlantic City. He said he is “very bullish” when it comes to trends in the meeting and event business.
“What we booked in 2023 was the best we’ve ever done . It’s the rebound of the event business. We see the volume coming and growing, and we see the interest in Atlantic City growing in the short term,” he said.
Total gross gaming revenue ($1.4 billion) was up 11% from 2022
In-person gross gaming revenue ($811 million) was up 1% from 2022
Nongaming net revenue was 45% of the total net revenue, compared to 39% in previous years
However, not all the numbers were positive. Overnight stays increased 8%, but were shorter than in recent years, she said. Casino employment was up in general, but labor shortages were still an issue. And weather was also a negative factor in 2023, according to Bokunewicz.
'The city needs to fix itself'
Mark Callazzo is managing partner of investment firm RMS Capital. He said 2023 wasn’t great for his businesses, which include Tennessee Avenue Beer Hall, Cuzzie’s Pizzeria, Rhythm & Spirits and Bar 32 Chocolate. He attributed the outcome to a belief that many people finally felt comfortable taking big trips and weren’t staying local.
Atlantic City skyline and beach. - COURTESY OF MEET AC
“Our customer count was down. Our average check was down. I think that a lot of the tourism was lost to people taking the trips that they had put off for three years,” he said.
Even with no beach concerts in Atlantic City and New York casinos looming on the horizon, panelists said their general outlook for 2024’s tourism season is “pretty robust.” However, there are some concerns related to inflation, labor shortages and, of course, the weather.
When it comes to challenges and opportunities to consider this year, responses ranged from the growth of women’s sports to improving marketing efforts to diversifying Atlantic City beyond just hospitality and leisure.
Callazzo stated, “I think the overlooked piece here is the city needs to fix itself. Bringing people to the city is really what we need to change. People come here. They work here, they get in their car, they drive offshore to where their house is. The city’s not going to change until we have more of a population that lives here. Adding people also helps the clean and safe perception.”
Monmouth County success
At a May 21 summer kickoff press conference at the Stone Pony in Asbury Park, Monmouth County Commissioner Director Thomas Arnone discussed the impact of the tourism economy.
Monmouth County Commissioner Director Thomas Arnone speaks during summer kickoff at The Stone Pony in Asbury Park. - PROVIDED BY MONMOUTH COUNTY GOVERNMENT
“Summer 2023 was incredibly successful with over 9.5 million visitors coming to Monmouth County. We also saw visitor spending increase from $2.8 billion in 2022 to $2.9 billion in 2023,” said Arnone. “In addition, our tourism industry supported nearly 24,000 jobs in 2023 and reported $29 million in beach revenue.”
“The success of our tourism industry comes down to our partnerships with our chambers of commerce,” he said. “The chambers attract businesses, encourage entrepreneurship and facilitate networking opportunities. This leads to job creation, increased investment, and overall economic prosperity, so thank you for your hard work.”
He went on to note the Monmouth County Division of Tourism’s continued support of the Monmouth County Chamber of Commerce and local events through a $246,000 destination marketing organization grant the county received from the state.
“We will be at more events than ever this year and we can’t wait to see everyone supporting our local towns and businesses. We are also excited to be the Platinum Sponsor for AsburyFest, taking place from June 7 through June 9 at Bradley Park,” he said.
According to the division , the state welcomed 120.5 million visitors in 2023. That was up from 114.6 million a year prior and 4% higher than 2019’s record level of 116.2 million travelers.
Visitor spending grew to $49.1 billion, which was 8% above the previous year and 6% higher than expenditures reported in 2019, the division said.
Overall, the visitor industry last year had a total economic impact of $78.3 billion in New Jersey. It generated $5.2 billion in state and local tax revenues, according to the report. Additionally, it sustained more than 501,000 workers, representing 8.3% of all jobs in the state.
Despite its forecast of weaker economic growth in 2024, the state expects a “resilient travel appetite” will continue to support overnight and day visits. Additionally, officials expect business travel to continue its comeback, thereby propelling growth in areas that hadn’t fully recovered in the previous year.
For 2024, the state projects 124.23 million visitors and spending of $51.4 billion. Meanwhile, total state and local taxes generated from visitor supported activity is projected to rise to $5.3 million.
Beyond this year, visitor volume is expected to reach 126.6 million in 2025 and 130.3 million in 2026. Spending will grow to $53.1 billion in 2025 and $55.7 billion in 2026.
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