Gulf Coast tourism posts strong summer as businesses brace for economic uncertainty

by Sara DiNatale, Mississippi Today
August 3, 2022

BILOXI — Captain Mike Moore missed half the peak tourism season while restoring one of the Gulf Coast’s oldest attractions: Sailfish, the shrimping boat. 

But even with wrapping up his boat trips early last year and the late start to the season this spring, Moore said his business is going strong. It’s been another solid summer for the coast’s tourism economy, which attracts about 14 million people a year and makes up a third of the state’s overall visitor spending. 

“It’s been great,” Moore said. “Have I had better years? Yeah, but I also never had a situation like this before. We made the decision to restore the boat to brand-spanking-new. It was a long-term goal.” 

Moore isn’t alone in his successes. Hotels have boasted high occupancy rates. The gaming commission has reported solid tax revenue from the state’s casinos. 

Numbers are good – they’re mostly better than before COVID-19, but not as high as they were last year when the coast’s drive-in mark surged while tourists were still hesitant to fly and some destinations were still locked down. But as summer wraps up, many business owners are heading into the fall with the weight of uncertainty. 

Experts are debating if the U.S. is already in a recession, inflation is on the rise and fuel costs are up. Those realities came up in Tuesday’s tourism board meeting at Coastal Mississippi, the region’s tax-funded tourism marketing agency. The board was voting to approve the latest budget.

“This is changing now because of economic unrest, fuel costs, the competitive set being open – fully open, is the huge question mark,” said Coastal Mississippi executive director Judy Young, referring to the agency’s expected revenue in 2022 and 2023.  “I am less worried about economic unrest and fuel costs as I am about a whole country being open. Because this will be the first full fiscal year where we don’t have that advantage.” 

Spring break and summer are the coast’s peak months of sustained business. Last year, coast tourism businesses saw all-time highs most leaders didn’t expect to continue quite as strongly.

In April of 2021, the state’s gaming commission collected a record-breaking $19.8 million in tax revenue. This April, that same period of tax collection was lower at $14.5 million. Still – this April’s tax collection was $2 million higher than it was in pre-pandemic April 2019. 

Hotel occupancy rates hit 80.3% in June in 2021. This June, they dipped slightly to 77.5%, according to data from industry analyst STR, Inc. That translates to more than 211,000  non-casino hotel rooms sold – lower, but still steady.

“It’s been really strong for all our hotels all across the board,” said Roxy Condrey, whose company Rain Residential manages five area hotels. “The rates have increased and the occupancy as well. We are getting a lot of traffic. People discovered us over the period of COVID restrictions, introducing us to some of these new target markets.” 

Condrey’s boutique properties – like Ocean Spring’s The Roost, The Inn and Hotel Beatnik – are still turning high booking rates. Most often visitors are booking at least three months out to snag a stay in one of the trendy spots, such as The Beatnik’s 1960s-style cabins. 

But August marks the start of a seasonal slow down until business booms again in October, when the coast’s three counties are swarmed with classic cars during Cruisin’ the Coast.

“We are seeing numbers that aren’t as good as last year but strong compared to three and four years ago,” Condrey said. “I feel good about it but inflation is definitely taking hold and I do foresee some of this slowing down.” 

The Coast’s key visitors are from nearby regions: Baton Rouge, Jackson and Mobile. Coastal Mississippi is trying to grow its reach, advertising to new target markets such as Memphis, Birmingham and Atlanta. 

That’s why high gas prices are top of mind. In Mississippi, average costs at the pump have dropped some in the last month but are still about $1 higher than they were this time last year, according to the American Automobile Association. 

But Moore, the shrimping boat captain, is optimistic. He’s noticed a decent chunk of travelers who are still driving cross country in RVs. 

“We have seen plenty of people out and about. As crazy as the world is you’d think it would be slower,” Moore said, referring to economic uncertainties. “But I think the thought process is still: I’m tired of being locked up and I want to enjoy myself.” 

But with those uncertainties in mind, Young and Coastal Mississippi are forecasting internal revenue this year hitting about $6 million dollars. Going into the next fiscal year, the agency is forecasting a moderate increase to $6.45 million dollars.

Young told her board she doesn’t want to overcommit their budget, given the possibility that the country’s gross domestic product could drop again for a second-consecutive quarter. 

“I’d rather be conservative on the front side and go back with an amendment to increase revenue later, when there are more things known than to shoot high and then have to do a decrease,” Young said at the Tuesday meeting. “It just doesn’t sit well with my competitive nature to go backwards.”

After some back and forth, the board ultimately agreed unanimously. 

This article first appeared on Mississippi Today and is republished here under a Creative Commons license.