The UK used to be a European tourism hot spot. Here’s how it all went wrong

(CNN) — It’s hardly a great tourism slogan.

“Britain is grinding to a halt” was the verdict of the UK’s Labour Party on the country they hoped to govern, as they were setting out their case for election in June.

On July 4, they won by a landslide, promising change. As residents wonder what to expect day-to-day, those abroad might wonder what it means for their travel plans. Because one industry that could do with a change is tourism.

Since time immemorial, visitors have flocked to the UK. Its heritage and cultural sites have traditionally made it one of the jewels in Europe’s crown.

Yet while visitor numbers are up across the board on the continent – nearly all EU member states saw numbers rise in 2023 year-on-year – the UK has not yet caught up with pre-pandemic numbers.

Nearly 41 million overseas residents visited the UK in 2019. In 2023, 37.68 million entered – a drop of 7.3%.

Compare that with Italy, which set a new record for arrivals numbers in 2023. Only Luxembourg saw a drop of 0.1% fewer tourists.

What’s more, international visitors applying for a tourist visa were down by 19% on pre-pandemic numbers.

The slow recovery coincides with tourism-allied hiccups. Regular strikes have been hampering transport. “Rail cancelations are at record levels,” according to the new government in its pre-election manifesto.

The UK has a glorious coastline, but in recent years many beaches are increasingly polluted by sewage. Tax-free shopping for tourists has been axed, and EU visitors now need a passport to visit, which most don’t have.

And in 2024, the rhetoric around safety in the capital has been ramped up. In February, then prime minister Rishi Sunak suggested the country was descending into “mob rule.” He also flagged a 20% rise in knife crime in London in May.

His comments were political, made while campaigning for local elections. Yet few listening from abroad would have noted the context.

So what’s gone wrong for the UK – and can the incoming government turn it around? Labour’s pre-election manifesto, in which the party outlined its plans for the country, pretty much ignored the tourism industry. But it didn’t mince its words when describing the problems.

“Britain is grinding to a halt,” it said. “Rail cancelations are at record levels… Conservative chaos has seen major projects abandoned, decades-long delays… and our infrastructure crumbling.”

The party has promised to “modernize” UK transport infrastructure, “rebuilding Britain.” The railways will be brought under public ownership. Those traveling by car will be pleased to know that Labour also pledged to repair potholes.

However none of this will be quick. Labour’s infrastructure overhaul is based on a 10-year plan.

Shifting priorities

Is the UK really doing that badly or have travel trends shifted, post-pandemic? For Tom Jenkins, CEO of the European Tourism Organisation, it’s the latter. “I think the UK is doing perfectly well but we’ll see more people going to [continental] Europe,” he says of 2024, adding that there’s “allegedly a slight plateau of American demand for the UK.”

Patricia Yates, CEO of VisitBritain, disagrees, saying that American visitors have “driven our recovery since the pandemic.” Kayla Zeigner, owner of travel agency Destination Europe, says she is booking ever-more trips to the UK.

But for Marcy Zyonse, owner of Live The Dream Travel, a luxury vacations company, the UK has been hit by changing post-pandemic travel trends. “The appetite for epic, culturally immersive travel has been so strong in the past couple of years,” she says.

“People were starved for that. In the US, we didn’t go beyond the Caribbean for a couple of years, so people are looking to do that Greece or Italy trip. We’ve missed out on two or three years of travel, and I think the UK is too low down on the list.” English-speakers want a more exotic experience, she says – starting with a foreign language.

After all, the UK is known for history, culture and the royals – all of which will be around next year. It’s easier to prioritize that for a much-needed Mediterranean break.

And that heritage has also meant the outgoing government has let the tourism industry slide, says Yates.

“There’s a view that we have enormous strength in our culture and heritage, and people will just come,” she says.

“That isn’t the case. Like every export industry, we have to pitch – to tell people why they should come now. The balance of being a history and heritage destination is that it was there 10 years ago and will be there in 10 years.”

There’s also a hangover from the pandemic, when UK travel rules were particularly chaotic, say experts. Destinations that opened early got visitors raving about their first post-lockdown trips – which had a knock-on effect.

“Current hotspots are destinations that opened early in 2021 to American tourists, which created a huge surge in demand,” says Zeigler.

Zyonse agrees. “You guys in the UK were behind, and people lost confidence. People booking in 2021 for 2022 didn’t book the UK, and the effect snowballed. Social media has driven people to those places [that opened up earlier].”

Making Britain ‘great’ again

So what’s to be done? For Yates, the new government could use tourism as an economy-booster – to the tune of 7% growth every year, she says, according to VisitBritain’s projections.

“The strength of tourism is that you can dial up quickly – we don’t need to build lots of infrastructure,” she says.

“It’s a case of promoting the right places at the right time to the right customers.”

Promotion is tricky in itself. The outgoing Conservative government was infamous for its “austerity” cuts to public spending. In evidence to parliament in March 2024, VisitBritain revealed that its marketing budget was around “£18 million ($23 million) annually, compared to over 80 euros million ($85.5 million) for Ireland.”

Back in November 2021, Yates told CNN that VisitBritain didn’t know what its budget would be from March 2022.

Today, she explains, it has a £19.8 million core budget, and gets around the same amount from another government campaign. That’s still around half of Ireland’s budget – so private-sector funding is used to boost it.

“We know that for every £1 invested we get £15 spent by tourists – a slice goes to the treasury, and money goes directly from international visitors into the economy. It’s a win-win,” she says.

But she’s keen for the new government to help take things further.

“Tourism delivers over three million jobs, around 10% of the economy,” she says. “To have a real growth plan, we have to make a statement about Britain overseas that will drive visitors and investment.”

Welcoming visitors

Not many tourists will have cared about political instability – as Zeigler says, “Americans are dealing with our own political chaos.” But Yates says that what does cut through is “the message of welcome.”

“It’s hugely important as a driver for international visitors,” she says. “Sometimes Britain has done that well, like during the London Olympics. Sometimes we don’t score as well. We need to look at how we position Britain as a welcoming destination, and how we look at borders and visas.”

In the 2023 Anholt-Ipsos Nation Brands Index, which ranks 60 nations on a range of attributes, the UK received its lowest ever rating for “Welcome.” Its rankings for “Culture” and “People” also dropped, though overall it rose two places to fourth position.

A visa for a Chinese visitor to the UK lasts a year, but costs the same about as a 10-year visa to the US, she says. Marcus Lee, CEO of China Travel Online says that visa efficiency is one of the top three drivers for Chinese tourists.

Visitors from the Gulf states have increased since the UK introduced a speedy “electronic travel authorization” scheme to fast-track their applications, says Yates. The scheme was due to expand to Europe and US markets – it will now be up to the Labour government to do so.

Meanwhile the self-styled “hostile environment” towards immigration of the last government hasn’t helped either. “For tourism, we want an efficient and effective border, but we do want people to come,” she says. “We need to think about language.” She says that people who visit the UK on vacation are 18% more likely to invest in the country – and investment is something the new government will be looking for.

Brexit side effects

As a result of Brexit, in 2021 the UK government abolished tax-free shopping for non-EU citizens. It means the UK is now the only European country not offering tax-free shopping to visitors from outside the continent.

Data from London retail promoter New West End Company in February showed that although visitor numbers in 2023 to the area were just 4% below 2019 levels, spending was down 19%. Visitors from the Gulf states – some of the wealthiest tourists to grace the UK – were up 20% on 2019 figures, yet they only spent 10% more.

The pattern was repeated with tourists from across the globe. US tourists were up 8% but spent 14% less. In Italy and Spain, however, US spending was up by 143% and 179% respectively.

“The impact of losing tax-free shopping is clear to see,” says Dee Corsi, chief executive of the NWEC. “While the UK strives to return to pre-pandemic levels of travel and spend, continental Europe’s recovery continues at pace.

“Whilst the likes of Italy and France are actively leveraging tax-free shopping as a driver of growth, British businesses continue to trade at a disadvantage. With domestic spend remaining squeezed, a continued decline of tourist spending will have a knock-on effect on employment rates, inward investment, and supply chains across the nation.”

She calls bringing back tax-free shopping a “rare, golden opportunity for the government to… inject a shot of growth back into the economy, with a tried-and-tested scheme and a captive audience.”

“We would urge the new government to grasp this opportunity with both hands,” she adds.

Meanwhile, EU citizens now need a passport to visit the UK, where pre-Brexit they could cross the border with their ID cards. In 2021, Jenkins told CNN that three-quarters of Europeans don’t have passports.

Then there are clouds on the horizon regarding getting in and out. When the new ETIAS scheme launches, every traveler entering the Schengen area for the first time will need their biometric data captured. “It’ll be time consuming initally,” he says. “There’s evidence that really bad entry systems deter people.”

’Bridgerton’ to the rescue?

So what can be done? For Zyonse, VisitBritain should spend that marketing budget on attracting influencers and travel advisors to lesser-known destinations. A self-declared lover of the UK, who calls London “a better version of New York,” she says that the post-pandemic drive for more “epic” adventures calls for a different approach. Timelapse videos of an elevator going up London’s Shard skyscraper, or something more wild in the Lake District, could attract social media likes, she says.

She also thinks that the “majority” of US family trips are driven by children’s choices. She just went to Greece to give her daughter a “Mamma Mia!” experience, and says that the UK “needs to get young girls posting on social media wearing a crown, or having afternoon tea, or doing something ‘Bridgerton’-related.”

She’ll approve of VisitBritain’s next big campaign, then. Launching at the end of 2024, “Starring Great Britain” will revolve around filming locations, says Yates, who adds that her team also wants to promote cheaper, out-of-season travel.

For Yates, the new government offers a chance to grow the industry. But she warns that the UK needs to revamp its international reputation, wishing for it “to be seen internationally as a welcoming, culturally diverse, vibrant country that people want to visit, send their kids to school and invest in.”

With the new government promising change from day one, it might not be long until she sees her dreams coming true.