Cruise Industry Drives $2.5 Billion into California Economy

Friday, November 29, 2019

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Mention California’s economy and most people think of manufacturing, technology, international trade, or tourism.

Those are all significant drivers, but a new report from the Cruise Lines International Association shows California got the second biggest economic boost from the global cruise industry in 2018, second only to Florida.

How big a boost?

The industry contributed more than $2.5 billion to the Golden State’s economy, an increase of 5.3% since 2016. That accounted for 10.4% of the industry’s nationwide impact.

2.2 Million Passenger Visits, Crew Arrivals

California is the home of headquarters and support facilities for several cruise lines including Princess and Crystal Cruises; it has four major cruise ports in Los Angeles, Long Beach, San Diego, and San Francisco.

Last year the ports generated nearly 2.2 million passenger visits and crew arrivals, or 8% of the nation’s total. Those visits fueled an estimated $151 million in passenger and crew onshore spending, or about $70 per passenger visit and crew arrival, CLIA reported. That was up 4.9% from 2016.

When total direct spending by passengers, crews and vendors who support the ships are figured in, that number topped $2.5 billion, or 10.4% of expenditures nationwide. That includes spending on everything from food, souvenirs, and theme parks, to boilers, laundry equipment, and industrial machinery. Tourism-related industries received 36% of the industry’s direct expenditures, with additional spending in the manufacturing sector and various advertising agencies.

Most of the cruises departing from California took in ports along the Pacific coast of Mexico, while others made their way through the Panama Canal, or to Hawaii and Alaska.

Lots of Jobs

The global cruise industry has also emerged as a major job creator. Last year it directly supported about 2,300 jobs in California, or 6.1% of the nation’s total. But when all of the direct, cruise-related spending is figured in, the industry supported 49,369 jobs (11.7% of the nation’s total) and generated more than $3.2 billion in wages throughout California.

That accounted for 11.7% of the national employment impact and 14% of cruise industry wages throughout the U.S. The average annual wage for a cruise ship employee in California was $59,200, according to the report.

 “The 2018 economic impact analysis shows the cruise industry’s growth in California is a positive economic driver in the state,” CLIA President and CEO Kelly Craighead said.

The dramatic growth, he said, “is reflective of the increasing popularity of cruising in the United States — and in particular, among Californians.”

Florida Tops The List

The global cruise industry’s economic impact in California is definitely big, but it’s dwarfed by what goes on in Florida.

Last year, Florida’s five cruise ports — the Port of Miami, Port Everglades, Port Canaveral, Port of Tampa, and Port of Jacksonville —  saw more than 12.4 million passenger visits and crew arrivals.

That accounted for nearly 60% of embarkations at all U.S. ports. It fueled nearly $8.5 billion in direct spending, which supported 154,646 direct and indirect jobs and nearly $7.7 billion in income throughout Florida.

The average annual cruise industry wage there was $46,500, far lower than California because of the state’s lower cost of living.

Rounding out the top 10, Florida and California were followed by Texas, New York, Alaska, Washington, Georgia, Illinois, New Jersey, and Louisiana.

Source: Orange County Register

Category: Economic News