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Special Edition

Economies Built upon the Sand

Tourists love to visit far-off countries to enjoy sand, sun, and sights; but what is life really like for the people who live in those countries? How do the residents of tourism hot spots view the travelers who frequent their sites?

Photo by Unsplash

Tourism accounts for millions of dollars spent year-round. At face value, marketing an area as a tourist destination seems like a lucrative advantage. Attracting crowds of people to stay at hotels, buy food, and collect expensive souvenirs can do nothing but good for an economy, right?

In some cases, the tie between economic health and tourist traffic is more of a symbiotic relationship in which both parties benefit from and appreciate the contributions of the other—neither is parasitic nor toxic. Countries that experience this kind of tourism can maintain an elevated average income with residents living well above the poverty line. Although these countries might experience economic decline without the continual influx of visitors, other sectors of the economy remain sufficiently strong to stand on their own.

Other popular destinations seem to be dependent on this income, fluctuating in turn with the health of the tourism industry. This by nature creates an economy of instability, especially for summer vacation spots like islands and beaches. We can imagine it as an economy built on a foundation of sand, as the tourism industry tends to be capricious and subject to the effects of political discord, natural disasters, and even global pandemics. During the COVID-19 pandemic, many tourism-dependent countries—such as islands in the Pacific—suffered economic decline by as much as 21%.i These destinations witness a larger disparity in the strength of their economic sectors. While the tourism sector of the economy is robust, stepping outside of the luxury hotels reveals poverty, underdevelopment, and a teetering system of employment. These types of economies aren’t solely reserved for small independent nations; cities and states within the United States that rely on the income from tourist traffic also witness such decline. Residents of such places tend to earn low average incomes despite the high-paying tourists.

Problems with Tourism Economies

While it is true that tourism can create jobs, generate income, and increase demand for infrastructure, issues arise in the types of employment this industry creates. These jobs are plentiful but tend to be entry-level jobs that are low income and labor intensive. They don’t require much—if any—education, and they have limited opportunities for upward growth.

The employment opportunities created by tourism are also dependent on traffic volume. Performers are out of a job when there is no one to watch. Hotel maintenance crews can’t work without guests. Unemployment levels threaten to rise as visitor traffic declines. In times of disaster, epidemic, and political unrest, these jobs often fall through when tourism comes to a halt. For example, Hawai‘i saw 17% of jobs disappear following the global pandemic of 2022.

Another common issue is that once tourism is established in an area, the potential for other kinds of improvement or development diminishes. Hotels may become bigger and newer and boast more amenities, but innovation and engineering marvels elsewhere flounder. And in locations like the Jamaica with a limited 4,200 square miles of land area, expansion isn’t feasible. Economic development doesn’t happen in stagnant ponds. Rather, economies see growth when new problems require new technologies, advancements, and discoveries. Tourism—especially the kind built around nature, wildlife, and scenic views—struggles to present these conditions for growth.


Tourism also presents interesting difficulties for a country’s daily economy. An influx of tourists introduces competition for resources like housing, water, and food, increasing those prices for local residents. Tourists grumble as they fork out upwards of six dollars for milk in Hawai‘iiii but fail to consider that their presence leaves those prices consistently high for the people that live there year-round. High volumes of tourists concentrated within a few months propagate these difficulties.

Selling Views

Once areas see tourism as a lucrative sector of their economy, it’s difficult to avoid a latched overdependence. Especially in areas with limited marketable resources, the resources of views, beaches, and culture become their marketable goods. In 2022, islands in the Caribbean saw more than 60 billion dollars of income from tourism.iv

Unlike goods that can be sold and whose prices can be manipulated based on demand, some tourism consumables are free. Beaches are public spaces. Sunsets can’t be sold. UV rays come free of charge.

These tropical commodities are among the most sought-after, and the ones that tourists can’t be charged for. Vacation spots that are popular for this type of tourism are at greater risk for weak economies and overdependence on the tourism sector.

Urban Tourism

High tourism traffic doesn’t necessarily lead to low wealth and weak economies. There are many cities and countries that count tourism as one of their highest-grossing industries and still enjoy economic growth, sustainability, and higher annual incomes. The types of tourism and attractions that a destination offers affects the relationship between economic growth and tourism. Relying on public spaces alone to bring in money isn’t sustainable. While budget-friendly beaches attract tourists on a budget—who can’t sustain an entire economy—high-cost tourism attracts high-paying visitors.

Urban tourism has greater opportunities for expanded tourist spending. This type of tourism is common in big cities, which are home to museums, theaters, and other ticket-requiring venues. High-end restaurants and designer stores also serve to bring in foreign income. Governments of tourism-dependent areas could consider introducing some of these high-earning attractions in an attempt to build a more sustainable tourism sector.

Searching for Solutions

So, what does this mean for tourists who want to travel ethically? Do we ditch the beaches to let dependent countries learn collapse the hard way? Do we boycott wealthy cities to even out the odds? These intricacies pose difficult moral dilemmas.

As visitors, we can be cognizant of local economies and the situations of those who call our destination home. We can try to pay the full value of the services we receive and be careful not to sacrifice any person’s hard work on the altar of frugality.

Ultimately, the essence of being a good tourist is awareness. Research the places you visit, respect the local culture, and leave the area better than you found it. Together we can create an economic environment that is firmer than a foundation of sand.