Hotels in Italy: The Restart That is Not There

COVID-19 continues to ravage hospitality

Hotels in Italy: The Restart That is Not There

“The storm of COVID-19 is still ongoing and continues to scourge the Italian hospitality system.” With these words, the President of Federalberghi, Bernabò Bocca, commented on the data of the association’s observatory, which monitors a sample of around 2,000 hotels in Italy monthly.

The final balance of the hotel and tourism market for the month of June 2020 records a lack in presence of 80.6% compared to the same month of the previous year. The flow from abroad is still paralyzed (minus 93.2%), and the domestic market is also well beyond the threshold (minus 67.2%).

As for foreigners, the opening of internal borders within the Schengen area, which also took place in mid-June, made its effects felt only to a small extent, while some strategic markets, including the USA, Russia, China, Australia, and Brazil still remain blocked.

For Italians, the return to a normal business trend continues in slow motion for various reasons. Many of them have taken their imposed holidays during the lockdown, many have seen their income reduced due to layoffs or the contraction in consumption and the blocking of activities, and many others have given up their holidays to make up for part of their lost activity.

Also, due to the reduction in the capacity of the means of transport, the cancellation of events and the various fears that understandably bother people.

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The repercussions on the labor market are painful. In June 2020, 110,000 seasonal and temporary jobs of various kinds were lost (-58.4%). For the summer months, 140,000 temporary jobs are at risk.

“The greatest absence is recorded  in the cities of art tourism and business travel,” said Bocca, “but also in the classic seashore, mountains, and spa holiday destinations, we are far from a semblance of normalcy. Television images depicting crowded beaches are misleading. Most of them are daily hikers or hit-and-run holidays, limited to weekends.” The final statistics for the hotels in Italy for the month of July are not reassuring: 83.4% of the structures interviewed predict that the turnover will be more than halved compared to 2019.

In 62.7% of cases, the collapse will be devastating – foreseen above 70%. “We have now entered the fifth month of lockdown,” commented Bocca, “and the shortage of reservations for the next few months makes us falter the hope that come autumn an initial semblance of a return to normality can be achieved.

“The relaunch decree and the other means adopted by the government contain some useful guidelines, [but] not sufficient to avoid the collapse of thousands of enterprises.

“To save jobs, we ask to extend the redundancy fund until the end of 2020 and to reduce the tax wedge for companies that recall staff to office. Then it is essential to complete the procedures on Imu (tax on housing/hotel property) and rents to be extended in duration and applied to all hotel businesses.”

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