Why do UK Oversea Holiday Bookings Continue to Suffer?
2011 was supposed to be the year that British that would see an increase in the number of foreign holidays following 3 years of decline. Unfortunately, this is not the case with the biggest tour operators in Europe reporting sluggish take up from the UK despite stronger performances in Germany and the Scandinavian countries.
Although the recession is officially over the first quarter growth was a measly 0.5% which is well below expectations with various fiscal bodies around the world all down grading their forecasts for 2011 and now 2012.
Reasons for Pressures on Disposal Income
1. The banks having virtually given money away have regressed to bolster balance sheets and are demanding ever higher deposits to protect themselves before providing mortgage funds. These deposits are out of the reach of many and to give their children a chance of buying a property parents are dipping into savings if they can afford to.
2. Inflation is now well above the rate of interest on savings, so even the better off retired sector is seeing their spending power decreased.
3. Youth unemployment is at record levels and parents have to lend a hand.
4. Unemployment is growing in the wider economy plus the constant threat of unemployment makes people savers rather than spenders.
5. Companies waiting for better times are cutting the working week reducing personal income.
6. Massive public sector redundancies, as the UK look to cut its deficit and balance the books
7. Public capital spending has been postponed or canceled, affecting the private sector.
8. Vat and National Insurance increases introduced in January and May of this year.
9. The pound abroad is worth far less than back in 2007, making foreign trips even more expensive.
10. Rising fuel costs has already led to fuel surcharges.Continued on the next page