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A cost of living crisis refers to a scenario in which the cost of everyday essentials like energy and food is rising much faster than average household incomes.

You may have heard the term inflation used a lot in relation to this. Inflation simply measures how fast costs have risen year on year, expressed as a percentage. The most recent rate of inflation was recorded in November as 9.5 per cent. This means that the cost of everyday essentials is about 9.5 per cent higher than in November 2021.

The crisis we’re experiencing currently is particularly severe because there are several different factors pushing up prices, rather than just certain items becoming more expensive.

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The countries facing the worst effects of the crisis across all poverty lines, according to UNDP, are Armenia and Uzbekistan in Central Asia; Burkina Faso, Ghana, Kenya, Rwanda, and Sudan in sub-Saharan Africa; Haiti in Latin America; and Pakistan and Sri Lanka in South Asia.

But even in the most developed countries, people are going without food. In May, an Ipsos poll for the World Economic Forum found that 1 in 4 people were struggling financially in 11 developed countries. In the UK, as many as 1 in 7 adults now say they can’t afford to eat every day - an increase of 57% since January.

The poorest families are the most affected by price rises because food and energy bills make up a bigger proportion of their monthly outgoings - in some cases, twice as much.

The economic impacts of the Russian invasion of Ukraine are rippling out across the globe in a cost of living crisis that’s pushing millions more people into poverty.

Soaring food and energy prices have resulted in 71 million people in developing countries falling into poverty, according to the UN Development Programme (UNDP).

“Unprecedented price surges mean that for many people across the world, the food that they could afford yesterday is no longer attainable today,” says UNDP Administrator, Achim Steiner.

While supply-chain disruptions from the COVID-19 pandemic had already pushed up prices, inflation is rising due to further disruptions caused by the war in Ukraine.

Most of the 166.8% cost increase in natural gas over the 12 months to May 2022 has been recorded since the war began in February. Russia’s war in Ukraine is also responsible for almost 40% of the annual price increase of wheat and for 60-75% of the annual price increases of corn and sunflower seed oil, according to UNDP.

Brexit has already contributed to Britain's particularly high inflation by introducing friction into the country's most important trading relationship, and hitting the value of the pound, which has made imports more expensive.

Researchers at the London School of Economics found extra red tape from Brexit could have added £250 to an average household's food bills between December 2019 and March 2023. Most of this increase came before the current cost of living crisis, as businesses prepared to implement new Brexit measures.

Even if the inflation rate were the same on average for lower-income and higher-income households, the impact is still likely to be felt more for those at the bottom. Poorer households have less disposable income and less flex in their budget if and when costs increase. While a richer household might be able to absorb higher energy costs, for example by reducing how much it saves, that option may not be available for many low-income households.

A high demand for oil and gas outstripping available supply. The Ukraine conflict has exacerbated this further, with a large amount of supply usually coming from Russia

Pandemic support awarded by the government coming to an end, such as reduced VAT rates for hospitality businesses

Disruptions to global supply chains, partly driven by Brexit and the pandemic

Reduced staffing levels across various businesses for the same reasons

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In Spain, train travel over distances up to 300km will be free for the three months from September to December, for those buying a multi-trip ticket.

In Kenya, President Uhuru Kenyatta, who is stepping down after two terms in August, has increased the monthly minimum wage by 12%. The government is helping farmers pay for fertilizers and is providing fuel subsidies.

Germany has taken a similar approach, where the federal government introduced a $9 monthly public transport pass until August.

The government in India has restricted wheat and sugar exports and announced tax cuts to fuel and essential goods to help insulate consumers.

In Scotland, First Minister Nicola Sturgeon has set out plans to freeze rents to help people cope with the rising costs of energy and food.

The UK is giving 8 million low-income households a direct payment of $780 split into two instalments, while every household will get a $480 energy grant.

Bangladesh is introducing family ration cards to ensure low-income households have essential goods.

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The impact on the Travel and Tourism Industry.

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The impact on the Travel and Tourism Industry.

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After being struck by lockdowns and emergency measures enacted during the coronavirus (COVID-19) pandemic, the industries commonly associated with the travel and tourism sector – transportation, hospitality, and recreation – might face another challenging time due to the dramatic increase in global inflation. Several factors should be considered when looking at the recent sharp increases in consumer prices that are, directly and indirectly, also affecting travel and tourism worldwide. The economic impact of the Russia-Ukraine war, for instance, and supply chain disruptions contributed to aggravating existing crises, including the increasing price of global monthly crude oil and the rise in energy and food costs. Overall, these circumstances are causing a surge in travel-related costs and cutting back the purchasing power of tourists. However, it is worth understanding how high inflation is hitting each travel and tourism segment individually, since the sector comprises a wide range of goods and services.

The overall cost of holidays between 2022 and 2023 in the top five destinations has risen by nearly 12%, from £880.01 last August to £984.52 this year. According to the Office for National Statistics (ONS), the CPIH All Goods Index rose by 9.7% in the 12 months to May 2023, down from 10% in April.

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Starting of , with aprox. 83% of people book their holidays online, only 73% go to Travel Agents these days. Our mobile day have become our tourguide, by downloading different apps based on liking or interests, these days you can find and do ANYTHING on your phone, according to trip advisor 45% of users use their smartphone for everything having to do with their holidays.

To automate processes and decrease 'human error', the travel industry uses robots to enhance customer service and reduce costs on labor. Hotels use robots for concierge roles, and restaurants use robots in food preparation and other food service. Airports can use robots to detect insecure activities, like weapons.

Now, thanks to online reviews and social media, potential visitors can get the real scoop from previous visitors, regardless of whether they know them or not. Likewise, this has put extra pressure on less scrupulous tour operators to upgrade their services to provide a better service.

In the future, don't be surprised if we see automated baggage handling, AI-powered bag recognition programs, AI security scanning and perhaps even an AI global database that links travelers with their bags – all solutions that could lead to fewer lost bags in the long run.

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Stats

China, Cambodia, Rwanda, and Sri Lanka were particularly strong performers, having all experienced annual Travel &

Tourism GDP growth exceeding 8% between 2011 and 2020 (above the global average growth of 4.1%), and an increase in 10% in their Social Progress Index score in the same time period (above the average global increase of 6%). In Cambodia, where Travel & Tourism contributes to over a quarter of GDP and jobs, this could be attributed to the country and wider region opening up to international tourism and making significant investments in local infrastructure and connectivity. The trickle-down effects, in turn, created jobs and enhanced the quality of basic services, infrastructure, education and health services, among others.

Positive changes

Travel & Tourism has an important role to play, not only in driving economic growth, but also in enhancing social progress across the world. The Social Progress Index (SPI) developed by the Social Progress Imperative is a comprehensive measure of quality of life, independent of economic indicators. It measures 50 social and environmental indicators across three broad dimensions of social progress, notably, Basic Human Needs, Foundations of Wellbeing, and Opportunity. With

country scores from 0 to 100 and the average global score of 64.24, increases in SPI scores signal an improvement in social progress over time.

There are many social benefits of tourism, demonstrating positive social impacts. These might include; preserving the local culture and heritage; strengthening communities; provision of social services; commercialisation of culture and art; revitalisation of customs and art forms and the preservation of heritage.

Many destinations will make a conserved effort to preserve and protect the local culture. This often contributes to the conservation and sustainable management of natural resources, the protection of local heritage, and a renaissance of indigenous cultures, cultural arts and crafts.

In one way, this is great! Cultures are preserved and protected and globalisation is limited. BUT, I can’t help but wonder if this is always natural? We don’t walk around in Victorian corsets or smoke pipes anymore…

Our social settings have changed immensely over the years. And this is a normal part of evolution! So is it right that we should try to preserve the culture of an area for the purposes of tourism? Or should we let them grow and change, just as we do? Something to ponder on I guess…

Local people can also increase their influence on tourism development, as well as improve their job and earnings prospects, through tourism-related professional training and development of business and organisational skills.

The tourism industry requires many facilities/ infrastructure to meet the needs of the tourist. This often means that many developments in an area as a result of tourism will be available for use by the locals also.

Local people often gained new roads, new sewage systems, new playgrounds, bus services etc as a result of tourism. This can provide a great boost to their quality of life and is a great example of a positive social impact of tourism.

Negative Changes

Unfortunately, there are a large number of socio-cultural costs on the host communities. These negative social impacts include; social change; changing values; increased crime and gambling; changes in moral behaviour; changes in family structure and roles; problems with the tourist-host relationship and the destruction of heritage.

Social change is basically referring to changes in the way that society acts or behaves. Unfortunately, there are many changes that come about as a result of tourism that are not desirable.

There are many examples throughout the world where local populations have changed because of tourism.

Perhaps they have changed the way that they speak or the way that they dress. Perhaps they have been introduced to alcohol through the tourism industry or they have become resentful of rich tourists and turned to crime. These are just a few examples of the negative social impacts of tourism.

Globalisation is the way in which the world is becoming increasingly connected. We are losing our individuality and gaining a sense of ‘global being’, whereby we are more and more alike than ever before. Globalisation is inevitable in the tourism industry because of the interaction between tourists and hosts, which typically come from different geographic and cultural backgrounds. It is this interaction that encourage us to become more alike.

Many people believe globalisation to be a bad thing. BUT, there are also some positives. Think about this…

Do you want an ‘authentic’ squat toilet in your hotel bathroom or would you rather use a Western toilet? Are you happy to eat rice and curry for breakfast as the locals would do or do you want your cornflakes? Do you want to struggle to get by when you don’t speak the local language or are you pleased to find somebody who speaks English?

When we travel, most tourists do want a sense of ‘

familiar. And globalisation helps us to get that!

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Countries and how have they been affected.

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Countries and how have they been affected.

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The countries facing the worst effects of the crisis across all poverty lines, according to UNDP, are Armenia and Uzbekistan in Central Asia; Burkina Faso, Ghana, Kenya, Rwanda, and Sudan in sub-Saharan Africa; Haiti in Latin America; and Pakistan and Sri Lanka in South Asia.

But even in the most developed countries, people are going without food. In May, an Ipsos poll for the World Economic Forum found that 1 in 4 people were struggling financially in 11 developed countries. In the UK, as many as 1 in 7 adults now say they can’t afford to eat every day - an increase of 57% since January.

The poorest families are the most affected by price rises because food and energy bills make up a bigger proportion of their monthly outgoings - in some cases, twice as much.

In Kenya, inflation is running at a five-year high of nearly 8%. Single mother-of-three Florence Kageha, 44, who sells vegetables, has had to start cooking with firewood or charcoal instead of kerosene. The family are walking everywhere, rather than taking motorcycle taxis, and they eat meat once a month. "The price of vegetables at the wholesale market has doubled, so I have to sell at double the price, but the customers can't afford it and I end up making a loss," she told Reuters.

In the UK, where inflation has climbed to its highest rate in 40 years, from 1.6% to 9.1% in 18 months, 62-year-old Lenny Poynton, from south-east London, has been out of work since losing his job in removals in early 2021. He’s living on state welfare of around $300 a month and has been fasting regularly so he has enough money to buy food for his dog. "It's an uphill struggle to make ends meet," he told Reuters.

In Bangladesh, graduate Abdus Salam is one of 3.6 million unemployed people who are struggling to find work as inflation hits an eight-year high. He is living on $32 a month, so has swapped his morning breakfast of boiled eggs for chickpeas and a few nuts. He said: "I always think positive. I'm a fighter."

In Turkey, annual inflation is at a 24-year high of nearly 80% - but some experts say the true figure is more than double this official statistic. A March survey of residents in Istanbul found almost half could not afford red meat and a third could not buy vegetable oil. Pelin Miskioglu, who serves traditional Turkish breakfast to tourists at her cafe in the riviera town of Kas, said her regulars can no longer afford a beach holiday: "I don't think we will be able to survive this."

In Australia, where inflation is at its highest rate in more than 20 years, single parent Genevieve fears she and her son will be homeless after she was evicted from her Melbourne home. The rising cost of food has made preparing special meals for her son, who has multiple allergies, more difficult. She often skips meals to ensure he has enough to eat. "I just go without. I don't have any luxuries, I don't buy new clothes, I don't get my hair cut."

Venezuela has left a four-year period of hyperinflation, which is when monthly inflation rises above 50%. In 2018, inflation reached 65,000%, according to the BTI Transformation Index. Many Venezuelans have picked up extra jobs - or left the country in order to work and send money home from abroad. Retired schoolteacher Maria Teresa Clemente, 64, who lives in Caracas, took up side jobs such as sewing and hairdressing to pay her bills. "Most Venezuelans can't afford a funeral to bury a family member. What we do today is ask for donations from our communities to help pay for funerals," she said.

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For the first time in 2018, older persons outnumbered children under the age of five. By 2050, older persons will outnumber those ages 15 to 24, and one in six people will be over 65. Tourism businesses will have to adapt to this demographic that will inevitably form a greater part of the customer base.

According to US travel statistics by Expedia Media Solutions published on Skift, millennials travel the most, with an average of 35 annual vacation days. Generation Z members follow closely behind, using approximately 29 days per year for their vacations.

Eurostat confirms that senior travelers in Europe also participate less in tourism. In 2018, only 15.5% of UK residents in the 55-64 age group participated in tourism, and 18.6% of people aged 65+.

Almost half (46%) of the European population aged 65+ didn’t travel in 2018 due to health reasons.

Despite health reasons, what else influences these differences in the frequency of travel?

Well, older generations typically have more commitments, such as work and family. Younger people usually have more free time to travel, especially during school holidays. When it comes to senior UK residents aged 65+, they love visiting France, Spain, Italy, and Portugal, according to Avanti.

As we age, we tend to change our mindset about exploring the world. We still want to see the world, but we prefer to take trips in a leisurely manner and stay longer to explore new places fully.