Queensland’s tourism industry is heading into the winter school holidays with cautious optimism, buoyed by encouraging bookings across many regions and renewed interest in regional travel. However, tourism operators warn rising business costs continue to threaten profitability despite healthy demand.

The Queensland Tourism Industry Council (QTIC) said the winter school holidays remain one of the most important trading periods of the year, particularly for regional communities, with the Queensland Government’s regional travel voucher initiative providing an additional boost to consumer confidence.

QTIC Chief Executive Officer Natassia Wheeler said there were positive signs emerging across much of the state, but the outlook remained mixed.

“Any initiative that encourages Queenslanders to explore their own backyard and supports regional tourism businesses is welcome,” Wheeler said.

“The school holidays are always a critical trading period and there are certainly reasons for cautious optimism, but it’s not a consistent story across every destination.”

Industry feedback from Regional Tourism Organisations paints a varied picture across Queensland.

In the Capricorn region, caravan parks have experienced a late surge in bookings, with occupancy significantly stronger than it was just a month ago. Hotels and apartments are performing steadily, although smaller boutique accommodation providers are reporting softer demand than this time last year, while marine tourism operators continue to recover from an unusually challenging six months of weather.

In Tropical North Queensland, Port Douglas is entering its peak visitor season with cautious confidence, with operators reporting the destination is tracking ahead of the same time last year and enjoying strong activity as the winter season gathers momentum.

On the Sunshine Coast, forward bookings are sitting at around 60 per cent for the school holiday period, broadly in line with last year.

According to Experience Gold Coast, forward bookings for the June-July school holiday period were sitting at 58 per cent occupancy last week, with expectations they would strengthen closer to the holidays. Encouragingly, the Gold Coast Marathon weekend is already tracking at 81 per cent occupancy, ahead of the same period last year.

Despite encouraging visitor numbers, Wheeler said a growing number of tourism businesses were reporting that increased visitation was no longer translating into stronger profitability.

“Visitors may see busy destinations, bustling attractions and full restaurants, but many tourism operators are telling us they’re working harder than ever for smaller margins,” she said.

“The challenge isn’t simply attracting visitors. The challenge is the escalating cost of doing business.”

One long-established visitor attraction in South East Queensland, welcoming around 100,000 visitors each year and employing almost 50 staff, is facing an additional $462,000 in payroll costs in a single year – a 32 per cent increase for the business.

Meanwhile, a tourism operator in Outback Queensland that has successfully operated for more than two decades is absorbing an unexpected $78,500 increase in annual payroll costs, with little ability to recover those costs in a highly price-sensitive regional market.

Neither business has increased prices, citing concerns about affordability for visitors and Queensland’s competitiveness as a holiday destination.

Wheeler said these examples reflected a broader pattern emerging across Queensland’s visitor economy.

“What we’re seeing is a cost cascade. Wage increases, insurance premiums, fuel, energy, superannuation, compliance and finance costs are all arriving at once, leaving businesses with very little room to invest, employ more people or grow.”

“Many operators have deliberately chosen not to pass these increases on to visitors because they know Australian families are already feeling cost-of-living pressures. They’re absorbing those costs themselves, but that simply isn’t sustainable.”

Queensland’s visitor economy contributes more than $43.5 billion annually, supports 277,000 jobs and generates approximately $119 million in visitor expenditure every day, making tourism one of the state’s most significant economic sectors.

QTIC said common themes emerging from operators across the state include significant wage increases being implemented with little time for businesses to adjust, payroll costs extending well beyond award wages through entire workforces, escalating insurance premiums, reduced capacity to invest in new experiences and infrastructure, and disproportionate impacts on regional businesses where transport costs and geographic isolation amplify every cost increase.

Wheeler said while the school holidays would deliver an important boost for many businesses, governments must continue addressing the structural pressures facing the industry.

“We know families are carefully considering every travel dollar, which is why initiatives like the regional travel voucher program are so valuable in encouraging people to holiday in Queensland.”

“But if we want tourism businesses to continue investing in world-class experiences, employing Queenslanders and helping deliver the ambitions of Destination 2045 and Brisbane 2032, we also need practical policy settings that address the rising cost of doing business.”

QTIC is continuing to advocate to the Australian Government for practical measures that would ease cost pressures on tourism businesses, including transitional support following significant wage decisions, relief for marine tourism operators, reforms to payment processing costs, flexibility for small businesses experiencing financial distress, and targeted fuel rebates for transport-dependent tourism operators in regional and remote Queensland.

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