Post COVID Economic Recovery in the Sierra is Fast… and Slow

Visitor Spending in the Sierra is making a comeback after 2020’s dismal drop in tourism, but the tourism industry may have to make some fundamental changes in order to build a sustainable recreation-based economy in a post-pandemic world.

Kaeleigh Reynolds

Kaeleigh Reynolds

Planning Technician

California is in the process of economic recovery from the COVID-19 pandemic – more than 89% of the jobs lost in the Spring of 2020 had been recovered by March 2022 (PPIC). But different sectors and regions of the state have recovered at varying rates, with some interesting, and potentially long-term, impacts.

Historically, recessions have impacted inland California more than coastal regions – exacerbating existing inequalities. The economic downturn caused by the COVID-19 precautions and illness was markedly dissimilar. In January 2020, the Central Valley and Sierra region had the highest unemployment rates in the state – both nearly 8%. Whereas the Bay Area and Orange County had the lowest unemployment rates at just 3% (PPIC). Yet, when pandemic lockdowns took place in the Spring of 2020, the coastal regions had the most job loss and have been the slowest to recover.

The regional differences in unemployment numbers during COVID-19 may be best explained by the economic drivers in each region. Inland California relies heavily on agriculture and outdoor recreation – two sectors that were deemed “safer” regarding the spread of respiratory diseases. Across the state, the sector with the largest job losses was leisure and hospitality. But the Sierra, with its immense economic reliance on outdoor recreation, was slightly more insulated from the downturn than regions more dependent on the arts, entertainment, and leisure.

One lens to view the economic recovery in the Sierra is through Travel and Visitor Spending. This blog will define the Sierra using county-wide metrics from the same 22 counties considered in our soon-to-be published Regional Climate Vulnerability Assessment (link): Alpine, Amador, Butte, Calaveras, El Dorado, Fresno, Inyo, Kern, Lassen, Madera, Mariposa, Modoc, Mono, Nevada, Placer, Plumas, Shasta, Sierra, Tehama, Tulare, Tuolumne, and Yuba.

In 2019, the Sierra employed over 110,000 people in tourism-based jobs, more than any other sector. By the end of 2020, the tourism industry had lost nearly 20% of jobs, and visitor spending decreased by 42%, earning $4.1 billions dollars less in 2020 than in 2019.

Year

Total Travel Spending

Visitor Spending

Earnings

Tourism Jobs

Local Tax Revenue

State Tax Revenue

Total Tax Revenue

2019

$10.9B

$9.9B

$3.7B

111,887

$372M

$532M

$904M

2020

$6.2B

$5.8B

$3.1B

91,780

$262M

$292M

$553M

Percent Change

-43%

-42%

-17%

-18%

-30%

-45%

-39%

Value Loss

($4.7B)

($4.1B)

($637M)

(20,107)

($110M)

($240M)

($351M)

By the end of 2021, the Sierra’s tourism sector had recovered 54% of visitor spending from 2020’s losses. But visitor spending in 2021 was still nearly $1 billion dollars less than 2019. In general, employment across the state has still not reached 2019 numbers. Out of California’s 58 counties, only 10 have surpassed 2019 employment numbers – and five of those counties are in the Sierra: Amador, Madera, Mariposa, Sierra, and Tehama counties (Dean Runyon | Visit California).  

Year

Total Travel Spending 

Visitor Spending 

Earnings 

Tourism Jobs

Local Tax Revenue 

State Tax Revenue 

Total Tax Revenue 

2019

$11B

$9.9B

$3.75B

111,887

$372M

$532M

$904M

2020

$6,239

$5.8B

$3.1B

91,780

$262M

$292M

$553M

2021

$9,560

$8.99B

$3.7B

104,270

$399M

$488M

$886M

COVID Recovery (2020-2021)

$3.3B

$3.2B

$611M

12,490

$137M

$196M

$333M

COVID Recovery  (% change) (2020-2021)

53.23%

53.99%

19.66%

13.61%

52.29%

67.12%

60.22%

Value Loss       (2019 – 2021)

($1.4B)

($998M)

($26M)

      (7,617)

$27M

($44M)

($18M)

COVID Impact     (% Change) (2019-2021)

-12.71%

-9.99%

-0.69%

-6.81%

7.26%

-8.27%

-1.99%

This analysis signifies the “last mile” of recovery may be the hardest to overcome (Univ of New Hampshire). While many surviving businesses in the Sierra have returned to business-as-usual employment numbers and earnings, other businesses were lost in the recession, and it will take time and capital for new businesses to replace the lost ones.

There may also be permanent changes to the economy across the state, and especially in rural, recreation towns. With more remote work, the Sierra has seen an influx of wealthier full-time residents. If these residents stay long-term, that may mean less visitor spending, a wealthier full-time population, and less available and affordable housing for typically lower-wage tourism sector employees.

While there has been a more equitable state-wide recovery, with inland regions of the state recovering quicker than we’ve historically seen in past recessions, the Sierra still has a well-established equity problem. The tourism industry will likely fully recover from the COVID-19 recession, but if a recovered tourism sector returns to its 2019 structure, the same problems plaguing the Sierra are sure to remain (unaffordable housing, low wages, employee shortages). It will be necessary for stakeholders and shareholders of the Sierra’s tourism sector to invest in family-sustaining wages, affordable housing, and sustainable business practices to fully establish a long-term economic recovery. 

Swimming in the Southern Sierra, photo by Erika Harvey

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