Latest / Amplify Canada / The Resilience of Canada's Tourism Industry
Transcript
- speaker-0 (00:08) Amplify Canada is a Patison Media initiative celebrating and elevating small businesses, the backbone of our economy. When the world changed in 2020, Amplify Canada highlighted the strength, determination, and generosity of small businesses across the country. Through uncertainty, closures, supply chain disruptions, and unprecedented challenges, these business owners found ways to adapt. Support their communities and keep moving forward. In this third season of Amplify Canada, we return to the businesses and entrepreneurs whose stories inspired Canadians during the pandemic and go deeper into the economic pressures facing small businesses and the country today. In this episode, we're diving into Canada's tourism industry. And before we look at the big picture, I want to ground this in where Amplify Canada began. With those small businesses. To watch. speaker-2 (01:13) The insurance utilities and ⁓ labors keep increasing, so that's a challenge. speaker-3 (01:21) People with bad years can turn the whole business around. It doesn't take much to ruin a small business. speaker-4 (01:27) Tourism is where macroeconomics becomes deeply personal. speaker-0 (01:35) These were the operators who survived the pandemic by reinventing, reworking, and finding entirely new ways to stay afloat, even though the tourism industry was hard hit. Tourism is one of the industries that's been worst hit by the coronavirus pandemic. It's estimated that global travel will fall up to thirty percent this year. The pandemic dealt a devastating blow to global tourism, causing international arrivals to plunge by seventy two percent in twenty twenty. And resulting in a loss of over $2.8 trillion in revenue. I'm Anne Gaviola with your top business headlines right now. Statistics Canada released a report looking at the resulting effect on tourism, which accounted for 2% of Canada's GDP before the pandemic. Visitor numbers began to recover in the second half of 2021, but have been inconsistent and have still not reached pre-pandemic levels. ⁓ Certain labor shortages, tariffs, shifting consumer spending, and recession. So before we go back to the business owners who showed us that resiliency, perseverance, and determination, and who helped tell this story the first time, we wanted to understand the bigger picture. So we connected with economist Marwa Abdu, Senior Research Director of the Business Data Lab at the Canadian Chamber of Commerce, to set the framework. I started with the big question. Looking at our tourism industry today, how would you describe its overall health? speaker-4 (03:05) So I wanna pick up on a word that you use, resilience, and small businesses in this country and everything that they've navigated over the past four to five years. Resiliency is also about intentional planning and intentional navigation. And that is embedded in this country's small and medium enterprises. They are the backbone of this country, and they form the majority of businesses in this country, and we need to treat them. Not as a monolith, but as really these dynamic forces of nature. Behind every visitor statistic is a family creating memories. It's a couple celebrating an anniversary. It's someone discovering a community that they never knew existed. Tourism, particularly, is one of those industries where economics and humanity intersect. The latest statistics, proof stats, can data show that the sector continues to outperform the broader economy. Real tourism's growth grew 0.5% in the first quarter of 2026, and that's compared with 0.1% growth across the entire economy. So it's certainly punching above its weight. What could be a record season for Canadian tourism? Nationwide, this year visitors are expected to spend more than $140 billion, up six percent from last year. CTV News, Prince Edward County. And so those numbers tell us something important, which is tourism isn't merely surviving. It continues to grow despite operating in one of the most uncertain economic environments that we've seen in decades. Today's challenges, they're inherently structural. So businesses are operating with permanently higher labor costs. They are operating with higher insurance premiums. They are facing higher financing costs and geopolitical uncertainty. They're also influencing where people choose to travel. speaker-0 (05:07) Canadian business owners live that math every day. Out in a rural stretch of British Columbia, Ed Abbey runs the Bull River Inn, a local pub located in a little piece of paradise in the southeast corner of British Columbia, just on the edge of the Alberta border. We first met Ed back in the early days of the pandemic. speaker-3 (05:27) Our business has done well and I totally feel for the ones that haven't, but I think partially the reason why we have come through this is because of where we are and people want to get away from the cities, want to get away from the personal contact. People feel safer out here. speaker-0 (05:47) It's worth noting how uneven the pandemic was for small businesses, especially in tourism. Nationally, rural hospitality took one of the sharpest hits, with visitor traffic dropping by more than half in some regions. But not all operators saw a decline. A small number, including Ed's Rural Pub, actually held steady or grew, largely because local tourism rebounded faster than urban travel. And community-based businesses became essential gathering points once restrictions eased. Ed talked about that resilience, how local demand returned quickly, how the pub's role in the community insulated it from the worst of the downturn, and how the nature of rural tourism helped them perform well through a period when many others struggled. speaker-4 (06:34) Yeah. speaker-0 (06:36) So Ed, it's so great to reconnect with you all these years later, after the pandemic and everything that you went through. And how have you been doing since we last talked? speaker-3 (06:46) We've been good. We survived. In fact it was the post pandemic that I think actually was the worst. We actually took a dip after the pandemic because we couldn't get staff. That was the biggest thing. Staff's always been an issue because we're pre rural. So we got over that. But like I said, we've grown year on year since the pandemic. So we're one of the ones that are surviving. I feel for the ones that have to lease their building, lease their restaurants, lease their bars, and couldn't afford to get through it. And I know there was lots speaker-0 (07:21) And I think that that's gotta be hard for the small business owners. We know how important small business is to our economy. speaker-3 (07:28) Yeah, that's right. A couple of bad years can turn the whole business around. It doesn't take much to ruin a small business. So we just persevered. We've got good clientele, we've got good neighbors, good customers that support us. And they were huge through the pandemic. They didn't want to see us go down and luckily we didn't. speaker-0 (07:51) Being in the food industry, we know the pressures on that industry right now. It's going up and up and up with costs, not only because of food costs, but of the transportation costs. So how are you managing that portion? speaker-3 (08:04) We've taken a hit for the last two years. We haven't done any many changes. We're right in the process of doing one now. We'll still be okay. I don't deep we're gonna push people away with the small increase, but it has to be done. There's margins you have to meet, whether it's busy or quiet, those are the points you have to hit. Food costs, gas costs, labor costs going up in DC again. We don't have a lot of overhead in that we own our own building. We just don't have those kind of Big cost that you would have a city. speaker-0 (08:36) When we spoke to you before, there was a little bit of the question of expanding into become a bit more of an in. Is that off the table because of everything you've dealt with or are you still looking at that as an option someday? speaker-3 (08:47) You know, I don't know. What we were thinking about, I think when we talked about last session was putting cabins on the property. And now, you know, for some of the reasons we just talked about, the price of building right now is huge too. So that's on the back burner for now. speaker-0 (09:05) What advice and hope can you give to other entrepreneurs that might be listening to this and maybe struggling a little bit right now to try to hang in? speaker-3 (09:13) Well that's tough on it. It depends on what you're doing. If you're good at what you do, stick it out. If you got doubts, maybe try different out of you. Have faith in yourself, have faith in what you do. We've been here 18 years, we've had some really tough ones, where we were close to shutting the doors. Back in the early days. Now it's a viable business. Get all your angles right in your business and you'd be fine. speaker-0 (09:40) Ted's story, the staffing crunch, the margin math, the building costs that shelved his expansion isn't an outlier. In my conversation with economist Marwa Abdu, she speaks to the fact it's one of the clearest patterns in the data. speaker-4 (09:56) There are forces that are shaping the industry. The first one I would say is affordability. Yes, inflation has come down, but prices haven't returned to where they were. Tourism businesses are facing that same reality through higher wages, through food costs, through utilities, through insurance, through borrowing costs. And so that has cascading effects on all of these different other parts of the tourism industries in these communities. The second I would say is labor. Tourism remains one of Canada's most People-intensive industries. You can automate check-ins. You can't necessarily automate genuine hospitality. Whether it's a chef, whether it's a tour guide, whether it's a hotel concierge, people remain the industry's greatest asset and one of, I would say, its greatest constraints. Travel decisions are deeply personal, but they are also economic decisions. So we respond. To exchange rates, we respond to headlines, we respond to affordability, we respond to political uncertainty, and even how confident we feel about the months that are coming ahead. And when you look at the data part of all of this, Statscan has shown that tourism patterns have shifted alongside changes in the broader Canada-US relationship. And I don't think that should be shocking to anyone. Looking at spending by international visitors in Canada, that has continued to recover. Domestic travel has become increasingly an important source of demand. The opportunities to ensure that Canada becomes a destination for Canadians and non-Canadians. And so every tourism dollar spent in Canada doesn't simply benefit a hotel. It supports a restaurant sourcing ingredients from local farmers. It supports indigenous communities. It's embedded in this sharing of knowledge that has been part of this country's fabric from the beginning. It's thinking about the artist that's selling work in a small gallery or the seasonal employee whose job depends on a strong visitor season. In economics, we call all of this the multiplier effect. And so when I think about economics, it's also important to think about these communities that are being nurtured by having that mutual exchange, not just a monetary exchange, but A societal and economical touch point that nurtures these other pockets of the economy. speaker-0 (12:24) And that multiplier effect brings us to a business built almost entirely on it. A century-old hotel, and the family now carrying it forward. We'll speak with owner Christine Lye in just a moment, but first a little history. Built in 1908 on Wellington Avenue, the Royal Hotel was once a cornerstone of downtown Chilliwack. For nearly 70 years, the Berry family ran it, even expanding into the former Royal Bank building in 1950 to add a beer parlor. A small hotel that completely shut down for part of the pandemic. speaker-3 (13:02) In March of twenty twenty, when the pandemic hit, hotels themselves were considered essential business. But given the size of our hotel and we've got about twenty-six guest rooms, it didn't make any sense to stay open. The cost just didn't warrant it being open. So from March till sometime in June of twenty twenty, we did not have any room available. speaker-4 (13:21) And so Many rooms available. speaker-0 (13:30) Today the hotel is operated by the Reacha Hotel Corporation, led by Christine Lye and her family. The name Reacha, a combination of words, created by the owners as a nod to how rich the opportunities and diversity are here in Canada. Let's pull into my conversation with Christine. This hotel had some great history, and now it's got some more history to it because you and your family have taken over. Can you just introduce yourself? And just a little bit of the background of coming into ownership. speaker-2 (14:01) I'm originally from Taiwan, an island cova formosa. 34 years ago my family immigrated to Canada, and we love Canada, and we love people in Canada, and the special thing is we love nature, so Canada is perfect fit for us. speaker-4 (14:19) This is speaker-0 (14:20) This has been quite an interesting journey for you. You got into the hospitality industry. speaker-2 (14:25) Yeah, but actu it's a beautiful building and it has its charm. We think it's really important that we keep this historical building for future for the kids, not only for the past people to come back and see their memories, but for the future we also want our kids to see what we have before. We want to keep its original charm, but we want to bring something new. As you know, Recently the economy people are saying that economy is not that good. You can see like the insurance utilities and ⁓ labors keep increasing. And to take over the ownership of the historical building, we have to spend money to fixing the building. So that's a challenge. But we are happy to take those challenges and make it become some kind of opportunities for us. It's difficult to find a great employee here. Some people they are not really want to put their hearts into their job. But to take care of a historical beauty, we really need someone to have the same feeling as us, to love this beauty and to co work and make things work. speaker-0 (15:46) What do you think your biggest challenge ahead might be? speaker-2 (15:50) biggest challenge is the cost for the maintenance is really the big challenge. Yeah. Yeah. That is something that I really have to manage. But it's okay because I can do it step by step. I take time to give it the improvement and try my best keep the the building as original. speaker-0 (16:11) How is the community connection going for you? speaker-2 (16:14) The local community they are really helpful. The first day, like took over the ownership and the community the people just showed up in the hotel and welcomed us. And that was so warm. That's why I really appreciate that I have a chance to work with them together and make the city of Chiliwag more stronger. And to build up the tourism in the Frisad Valley. speaker-0 (16:44) Do you have any advice for small business owners or entrepreneurs? speaker-2 (16:49) I believe hope comes from the people we meet every day. And in hospitality, we are fortunate to welcome guests from all over Canada and around the world. And when they tell us they enjoy their stay and recommend us to their friends and return for another visit, it reminds us why we choose this business. It's good that we support one another and find a creative way forward. Despite economic challenges. speaker-0 (17:21) Christine didn't inherit a franchise playbook. She's building something from instinct, family-style service, community first, patience with the costs. Economist Marwa Abdu says that's not a small business workaround. It's exactly where she thinks the whole industry is heading. speaker-4 (17:40) Data has its limitations and its ability to show us how dynamic the reality on the ground is. When you look at the businesses that have been quote unquote resilient, it rarely looks dramatic. It's a thousand small decisions that you make every day as an entrepreneur. And the tourism industry is a great example of that because tourism businesses succeeding today aren't waiting for conditions to sort of revert to normal. So the only way that you can continue to keep up is to think about how you can anticipate as much as possible the kinds of changes and the headwinds that are coming. The businesses that are showing steadiness across this uncertainty are the ones that are embracing technology to better understand demand. They're partnering with neighboring businesses to create destination experiences rather than focusing on standalone attractions. They are investing a lot on the per capita experience. That is your currency in this climate where every relationship that you nurture matters. The businesses that are thriving are the ones that are asking a very fundamentally different question. Instead of thinking about how do we bring visitors back, they're the ones who are asking, how do we create experiences that are so memorable that people become ambassadors for a community? For years we've thought about tourism success, it's often measured by volume, more visitors, more hotel nights, more flights. I think increasingly we'll start to measure success differently. Are visitors staying longer? Are they spending more in local communities? Are tourism businesses becoming more productive? Thinking outside the box. Are they investing in technology? Are they hiring more talent and skills? Thinking in creative and nimble ways to speaker-0 (19:41) That instinct, build the relationship, not just the transaction, shows up again and again, nowhere more deliberately than at our next stop, a paddling shop on the water in Deep Cove, British Columbia. Deep Cove Kayak was founded in 1981. speaker-1 (19:58) My mum is the founder of it, Ingrid Baxter. She lived in Deep Cove and she was looking to buy a canoe in the local newspaper and instead found a boat rental business down the street and bought that instead. speaker-0 (20:10) It has grown into one of the largest paddling centers in the Pacific Northwest. Before we reconnect with Arianne, Ingra's daughter, who took over the business from her mother, have a listen to what she said when we chatted during the pandemic. speaker-1 (20:22) Truth be told, the pandemic has been amazing for our retail store. It really increased our sales because everybody just wanted to get outside. With the retail store, we've had the same sort of supply chain problems and things like that, but it's been great for the retail store because we just had all sorts of things that people could get on the water on or get up the mountain on and that part's been really good. speaker-0 (20:43) And today Arian still has an optimistic outlook. What lessons have you learned in all the years of running business and being part of that small business community that you could share? speaker-1 (20:56) We're pretty lucky. I know that labor is a challenge for people, but we don't seem to have that hitting us. We do our best to provide a really great workplace and who doesn't want to work on the beach in the summer. So we've done pretty well labor wise. Sadly, we're seeing colleagues close. So there's been a number of people in the same territory as us of what we're selling that have closed, which is just hard to watch, right? One of the biggest things I think that was important for us was taking care of our staff. We call it a deep co family, right? We've had people with us for twenty years and longer. Really and truly. That's one thing about small businesses is we really do get to know our staff better and we know what people need and want. And then just still being flexible. The great pivot of 2020 taught a lot of us that you have to just keep thinking outside the box. speaker-0 (21:50) I think one of the biggest lessons is that consistency and that connection to community, how you serve your community, gives that community the desire to want to then support you. speaker-1 (22:01) Yeah, you hit right on our social purpose, inspiring deeper connections to the outdoors and one another. We have Race Night, which has a hundred people out every week. And I have a women's program that has about 70 people out every week. And we're always doing things trying to get people together, or whether it's somebody out on a date with someone for the first time. We're just using the outdoors to facilitate all that connection. And as we know, connection is so important for all of us, for our general health and everything like that too. speaker-0 (22:29) Is there anything about tourism in Canada, your perspective on being a small business in the tourism sector that you would like to share with listeners? speaker-1 (22:37) I think that traveling our own country can be pretty exciting too. With the struggles with our neighbors next door, I think more and more people are exploring Canada, which is great. So you're welcome to come to Deep Cove. We'll happily greet you there. It's always great to go see other places, but coming back to Canada is always the best. speaker-0 (22:55) Are you optimistic about the growth of tourism in Canada? speaker-1 (22:59) Yeah, I am. I think it's really great that people are exploring Canada more 'cause we've got so many things to offer and we're seeing that, which is really nice. We are just so lucky here. It truly is the best place to be. speaker-0 (23:16) Three businesses, one threat. Costs are up, staff can be scarce, but none of it has stopped these owners from showing up for their communities. We close our conversation with Marwa by asking where all of this is headed. speaker-4 (23:30) And I don't think tourism has experienced destruction as so much as creative reinvention. That's a fundamentally different posture. In the first quarter of 2026, spending by international visitors rose 0.9%, while spending by Canadians traveling within Canada edged down only slightly after a very, very strong 2025. And so that highlights the importance of both markets to the sector. Canada possesses A lot of assets that many countries would envy. Extraordinary natural landscapes, vibrant cities, indigenous cultures, political stability. You know, can assume that those advantages are going to continue attracting visitors automatically. And so when we talk about elbows up, we have to be ready to also put elbows in. You know, I often tell people what fascinates me about economics. It amalgamates everything from sociology to psychology to mathematics to understanding why people make the decisions that they do. And when you think about economics, it ultimately is a science of decision making and it's a science of trade-offs. Every dollar that we spend is a vote for the kind of economy we want to build. This is a time where we need to be intentional about our decision making in every field of work. If you're running a business, if you're looking at policy leaders, there's a lot of intentional focus and effort, particularly when you're thinking about entrepreneurs. There needs to be a greater appreciation from the whole ecosystem of how much small businesses are juggling. And I think sometimes we lose those human touch points with how these pieces interact and how we can get growth. That we'd be really proud to have as a country. speaker-0 (25:27) From a pub in rural British Columbia to a century-old hotel to a paddling shop, the story is the same at ground level. Costs are up, staffing is tight, and none of it has stopped people from showing up for each other. Canada's tourism sector is experiencing a historic boom, with visitor spending projected to hit a record $140.9 billion, driven by surging domestic travel and an influx of overseas visitors taking advantage of a favorable exchange rate. In an industry that supports roughly one point eight million jobs nationwide, what does recovery look like for an industry built on connection, experience, and people? speaker-4 (26:07) Tourism is not a nice to have industry. It is a major service export. It is a source of employment. It is a driver of entrepreneurship. It is one of the strongest economic multipliers in the country. And I don't think we think about that. So when we think about tourism succeeding, it is a foundational one. speaker-0 (26:27) Or maybe as simply put as speaker-1 (26:29) connection is so important for all of us, for our general health and everything like that too. speaker-0 (26:34) Maybe that's the answer. A special thank you to Mara Abdu, Senior Research Director of the Business Data Lab, the Canadian Chamber of Commerce. For those of you who are not familiar with the Business Data Lab, it's the data and analytics arm of the Canadian Chamber with a mission to democratize data about what's going on in the economy. She also hosts a podcast called Canada's Economies Explained. It's all about demystifying Canada's economy. It's available on all streaming platforms. You've been listening to Amplify Canada, an initiative powered by Patison Media, designed to support local businesses and promote shopping Canadian. Amplify Canada was created for Patison Media and produced by Everything Podcasts. Hosted, produced, and written by me, Linda Freeman, showrunner Kat Cullen, Sound Engineer Producer John Massikar, Executive Producer Jennifer Smith, production support Eric Chapman, video producer Jordan Wong. For more information on this program, go to padisonmedia.com. speaker-3 (27:41) Another Everything Podcast production EverythingPodcast dot com a division of Patison Media. Subscribe wherever you get your podcast. speaker-0 (27:44) Visit.com