April 22, 2022 | By Graeme Kemlo

While Australia’s major hotels fared better with good Easter occupancies, Melbourne and Sydney still lag behind other cities largely due to staffing issues.

CEO of Tourism Accommodation Australia Michael Johnson said the two major gateway cities are averaging more than 60 per cent occupancy.

“We have certainly seen demand increase week on week since late January, but the issue holding us back is that we’re still experiencing labour shortages…hotels could have done even better but they have had to hold back,” he said, explaining that many properties are still capping the number of rooms they sell.

Gold Coast and Cairns averaged about 78 per cent, Adelaide and Hobart over 80 per cent while Perth was trading at an average of 65.7 per cent.

Changes to vaccination and close contact rules in Victoria and New South Wales would help Johnson said.

“We definitely know the close contact rule has exacerbated the labour shortage and while it is not going to take the labour shortage away it will assist,” he said.

Despite federal government incentives Johnson said there had been a fairly slow response to working holiday makers and international students returning.

“Since December 15 we have had 16,000 to 20,000 working holiday makers come back to the country, but for this time of year we’re still 100,000 working holiday makers down.

“And more than 60,000 to 80,000 international students have returned, but that is of the 330,000 international students we lost.”

Australia faces increasing competition for international students, he said, giving the example of Canada‘s move to reduce the timeframe to complete a university degree.

“I am fairly confident that domestic is going to be our saviour this year and I would see heavily supported domestic travel in the September holidays with Australians starting to travel overseas from early 2023, but I think this is going to be a difficult year,” Johnson said.