Upswing in Tourism Could Cause Slump Later in Year

An upswing in Orange County’s hotel business earlier this year could cause a drop in tourism and tourism spending locally later this year, according to economists at Chapman College.

In data released this week, the private college’s Center for Economic Research said its measure of visitor spending shows a sharp upswing in hotel and motel occupancy rates during the first half of 1987, when tourists spent almost 6% more in the county than in the same period of 1986.

But the healthy business is expected to lull hotel-keepers into cutting back on expensive promotions and discounted room rates. And that, in turn, could cause a decline in hotel occupancy in the last quarter of this year and the first quarter of 1988, said James Doti, dean of economics and acting president of Chapman College.

The data--compiled from a sampling of Orange County hotels and motels--measures the spending as related to attendance at theme parks, occupancy of hotel and motel rooms, sales at eateries and gas stations and arrival of passengers at Orange County and Los Angeles area airports.

The Chapman theory that hoteliers will cut back on promotional spending and trigger a tourism decline was opposed by several area hotel officials.

While tourism may well decline--it usually does in the winter--several area hoteliers said, the hotels are involved in continuing promotional campaigns.

Chapman’s economists “don’t know the hotel business,” said T. Steele Edwards Jr., general manager of the Emerald of Anaheim Hotel. “When it’s off season, we’ve got to promote and advertise to keep it going.”