Economic Impact of Tourism in Maine: Explanation and Citation

Economics & Demographics Program

Economic Impact of Tourism in Maine: Explanation and Citation
State Planning Office, February 2008

The following paragraphs explain the meaning and source of facts and statistics quoted in a Reference Guide to Tourism and the Maine Economy.

“In 2006, tourism directly and indirectly generated roughly one in five dollars of sales throughout Maine’s economy. It supported the equivalent of one in six Maine jobs.”

The portion of Maine’s gross domestic product (“sales”) and jobs supported by tourism were determined using the 2006 Maine Visitor Survey conducted by Longwoods International in conjunction with the Maine Office of Tourism, and the Bureau of Economic Analysis’s 2004 RIMS II multipliers. Based on these sources an estimated 139,700 jobs and $10 billion dollars in sales were supported by tourism in 2006. In the same year the U.S. Bureau of Economic Analysis reported an average of 835,000 employed individuals and State GDP of $48 billion (Regional Economic Accounts, Gross Domestic Product by State, June 7, 2007 release). The percentage of jobs supported by tourism includes employment in tourism-related businesses, employment at firms that support tourism-related businesses, and increased employment generated by the employees of businesses that directly and indirectly support tourism.
139,700/835,000 = 16.7%
$10 billion/$48 billion = 20.8%

Jobs supported by tourism:
Maine: 16.7%
See above paragraph.

Massachusetts: 6.6%
Travel Industry Association of America. “The Economic Impact of Travel on Massachusetts Counties in 2004”. Massachusetts Office of Travel and Tourism, January 2006. Available at http://www.massvacation.com/pdf/impact_report_2004.pdf

Vermont: 9.4%
Economic and Policy Resources, Inc. “The Travel and Tourism in Vermont: A Benchmark Study of the Economic Impact of Visitor Spending on the Vermont Economy in 2005.” Vermont Department of Tourism and Marketing, 2007. Available at http://www.epreconomics.com/Docs/TT%20Benchmark%20Report%202005%20FINAL.pdf

New Hampshire: 9.5%
Goss, Laurence E. “New Hampshire Fiscal Year 2006 Tourism Satellite Account”New Hampshire Division of Travel and Tourism Development, June 2007. Available at http://oz.plymouth.edu/inhs/EconomicReports/Tourism_Satellite_Account_FY2006.doc

Florida: 12.5%
Center for Economic Forecasting and Analysis, Florida State University. "The Impact of Tourism on Florida’s Economy: Telling a More Complete Story", March 2006.
Available at: http://www.cefa.fsu.edu/TourismReportMarch2006.pdf

“In 2006, about one-fifth of state sales tax revenues were directly or indirectly attributable to tourism. Adding income and fuel taxes, state government received approximately $429 million tourism-related tax dollars.”

Total sales tax revenues from tourism are identified by applying the tax incidence for excise and sales tax to the estimated total sales generated by tourism in 2006. The tax incidence identifies the portion of sales that pays for the sales tax. In 2006, Maine Revenue Services determined that 0.8% of sales pay for the excise tax and 1.9% pay for the state sales tax. This includes the meals and lodging tax and the higher rate applied to car rentals. According to the Compendium of State Fiscal Information, total sales tax revenue in 2006 was $946 million. The portion of the estimated $10 billion in sales resulting from tourism spending that paid for sales and excise taxes is $271.6 million, or 28% of total sales tax revenue. The income taxes supported by tourism are identified by applying a 3.7% tax incidence to the total estimated earnings for tourism supported jobs. The fuel tax is calculated by applying the current state per gallon gas tax of 26 cents to the estimated number of gallons of gas purchased by out of state visitors. The number of gallons is based responses in the Longwoods survey.

Maine Office of Fiscal and Program Review. “Compendium of State Fiscal Information: Through Fiscal Year Ending June 2007.” Maine State Legislature, January 2008. Available at: http://www.maine.gov/legis/ofpr/07compendium/c07toc.html.

Domestic Travel Profile
All statistics from this section are from the Longwoods International Maine Visitors Survey from 2006.

“TripAdvisor.com ranked Millinocket, Maine among the Top 10 Hot US Travel Destinations for 2007.”
Tripadvisor.com press release, October 25, 2006. Available at http://www.tripadvisor.com/PressCenter.

“Frommer’s named Portland, Maine among its twelve Top Travels Destinations Worldwide for 2007.”

Frommer's Top Travel Destinations for 2007, released November 21, 2006. Available at www.Frommers.com