Cruises float $37 million to Charleston area economy

The Port of Charleston’s cruise business makes broad and diverse contributions the local economy and is projected to pump $37 million into the region this year while supporting more than 400 jobs.

These are the results of a new study produced by Dr. John Crotts and Dr. Frank Hefner and commissioned by the South Carolina State Ports Authority (SCSPA). The researchers analyzed the economic contributions of planned cruise activity in 2010, which includes 16 port-of-calls and 53 embarkations from Charleston.

Among the study’s key findings, Charleston’s cruise business this year will support in the Tri-County economy:
•More than $37 million in total economic output
•407 jobs
•$16.2 million in salaries and wages
•$3.5 million in state sales and income taxes

“Where most communities are only shedding jobs, Charleston is adding them,” said Crotts. “Each time a cruise ship is at the dock, there is a local boost of more than $323,000.”

Restaurants and hotels see positive impacts from the cruise business, yet the greatest spending occurs in transportation services, such as the ground shuttle and the port industry. Retail stores and wholesale trade, such as a ship’s spending for food and other supplies, are other top sectors.

“Cruising contributes to the local community beyond the traditional tourism impacts,” said Crotts. “A large portion of passenger and crew spending goes to support resident-oriented businesses, helping to keep them viable for our neighborhoods.”

Cruises also serve as a vital marketing tool for the region, noted Crotts.

“Based on income and other demographics, the typical cruise passenger in Charleston is a great match with the local tourism industry’s target visitor,” said Crotts. “Nearly half are first-time visitors to Charleston and demonstrate a high likelihood to visit again and recommend the City as a vacation destination to family and friends.”

Based on passenger surveys in November 2009, two-thirds of passengers on a port-of-call visit will leave the vessel and actively contribute to the local economy. Half of those who leave the vessel during a call will go on organized excursions to plantations, museums, historic houses and other attractions, while the other half will explore the City on their own.

The study was conducted utilizing the IMPLAN econometric model, passenger and crew surveys, as well as surveys of the cruise lines which will call Charleston this year. The surveys measured spending behavior by visitors, crew members, and cruise lines when they visit Charleston.

“The far-reaching economic benefits of the cruise business are clear,” said Jim Newsome, president and CEO of the SCSPA. “We will continue to serve the cruise business in a way that generates these economic contributions while also considering the interests of our neighbors.”

Last fall, the SCSPA hired nationally the renowned planning firm of Cooper, Robertson & Partners to develop a master plan for the passenger terminal and surrounding property.

The goals of the project are to create a financially viable plan for a cruise terminal that reflects the character of Charleston and meets today’s security requirements, as well as to provide more public access to the waterfront and additional uses for the property for the enjoyment of Charlestonians and the betterment of the economy. Initial planning concepts will be shared with the public on February 9.

The entire economic impact study is available online at www.scspa.com/cruisestudy.pdf .

ABOUT THE SOUTH CAROLINA STATE PORTS AUTHORITY
The South Carolina State Ports Authority, established by the state’s General Assembly in 1942, owns and operates public seaport facilities in Charleston and Georgetown, handling international commerce valued at more than $62 billion annually while receiving no direct taxpayer subsidy. An economic development engine for the state, port operations facilitate 260,800 jobs across South Carolina and nearly $45 billion in economic activity each year.