Mexican Visitors to Arizona: Visitor Characteristics and Economic Impacts, 2007-08

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Mexican Visitors to Arizona: Visitor Characteristics and Economic Impacts, 2007-08

Executive Summary

Travel and tourism continues to be among the most important export industries driving Arizona’s economy, and Mexican visitors are an important contributor to this sector. This is the fourth study conducted by The University of Arizona since the late 1970s which assesses direct spending by Mexican visitors and estimates their total economic impact on Arizona. Primary data on expenditures were collected through a year-long survey starting in July 2007 and ending in June 2008. Mexican visitors were interviewed as they were returning to Mexico through one of the six Arizona border ports of entry – Nogales, Douglas, San Luis, Lukeville, Naco and Sasabe -- and two international airports in Phoenix and Tucson. Estimates of total economic impacts, including indirect and induced sales, jobs, and income were estimated using the IMPLAN input-output models for the State, metro areas and border counties. Tax revenues were estimated by state and county tax revenue models.

MEXICAN VISITORS

As in the three previous studies (1978, 1992, and 2002), visitors in this study include both the so-called traditional tourists, who generally visit another country for leisure, historical site visits, and similar reasons and who tend to stay overnight, and day visitors or the non-traditional tourists who cross the border but return the same day. There was total of 24.04 million alien crossings from Mexico to Arizona from July 2007 through June 2008; 84.24 percent were day visits and 15.76 percent were overnight visits.

SIZE OF VISITOR PARTIES AND TRAVEL MODE

The 24.04 million Mexican visitors came to Arizona in 13.37 million parties. They came in parties of 1.8 persons that include 1.47 adults and 0.33 children. About 55 percent of all visitor parties enter by car across the U.S. Mexico border and almost 45 percent are walkers. Less than one percent of all Mexican visitor parties to Arizona fly into the state.

REASONS FOR VISITING ARIZONA

Leisure, such as shopping, vacation, visiting friends and relatives, and personal health, is the primary reason for visit for 63.94 percent of all visitor parties. Business-related reasons, such as work, business convention, professional training, and business shopping, is the primary reason for visit for 36.06 percent of all visitor parties.

LENGTH OF STAY

Close to 16 percent of all Mexican visitor parties are overnight visitors; about 2 percent spend one night; about 4 percent spend two nights; close to 5.5 percent spend 3 nights. About 4 percent spend 4 or more nights. Of those who spend one or more nights in Arizona, 60.97 percent stay in hotels and 39.02 percent spend the night with family and friends. Executive Summary iv Mexican Visitors to Arizona, 2007-08 The University of Arizona Eller College of Management ORIGIN OF

MEXICAN VISITORS TO ARIZONA

Almost 99 percent of Mexican visitor parties come from the neighboring Mexican state of Sonora. Of those, 46.9 percent come from the border city of Nogales, the largest of Sonora’s border cities; 24.1 percent come from San Luis Rio Colorado, and 13.37 percent from Agua Prieta, and 1.32 percent from the capital city of Hermosillo. The remainder comes from about 20 other cities in Sonora, but also from Baja California, Sinaloa, and the Mexico City metropolitan area.

SHOPPING DESTINATIONS AND ATTRACTIONS VISITED

Three Arizona malls -- Arizona Mills Mall in Metro Phoenix and Tucson Mall and Park Place Mall in Tucson – are the most popular shopping destinations. Among the non-mall stores, Wal-Mart is the most popular in every destination city. Casinos in Tucson and Phoenix are the most popular attractions; the zoo parks are the second most visited attraction.

ECONOMIC IMPACT: JOBS, INCOME AND SALES

The results of this study, as in the past, demonstrate the economic importance of Mexican visitor spending to Arizona’s economy. Close to 23,400 wage and salary jobs in Arizona at eating and drinking establishments, retail establishments and other spending-related sectors are directly attributable to Mexican visitor spending. Through local purchases of supplies by businesses and the spending of income derived from visitor-related jobs, these visitors generated almost 7,000 additional jobs in Arizona in 2007-08. These jobs account for a total income of $837.24 million and $3.61 billion in sales.

GEOGRAPHIC DISTRIBUTION OF ECONOMIC IMPACTS

The largest economic impact of Mexican visitor spending occurred in Pima County. A county that includes Tucson and extends all the way to the U.S.-Mexico border, Pima County receives 41.21 percent of the total job impact, 37.68 percent of the total sales impact, and 39.79 percent of the total income impact. Maricopa County, containing the State’s largest metropolitan area and the capital city, Phoenix, receives the second-largest share of the total impact: 28.11 percent of total jobs, 26.57 percent of total sales, and 31.69 percent of total income. Santa Cruz County, the border county that contains Nogales, the largest port of entry into Arizona, receives 14.81 percent of the total job impact, 16.35 percent of the total sales impact, and 13.03 percent of the total income impact. Yuma County receives 8.11 percent of the total job impact, 9.16 percent of the total sales impact, and 7.56 percent of the total income impact; Cochise County receives 5.81 percent of the total job impact, 6.18 percent of the total sales impact, and 4.93 percent of the total income impact.

CONTRIBUTION TO TAXABLE SALES

Mexican visitor spending represents a staggering 48.62 percent of the total taxable sales in Santa Cruz County. Mexican visitor spending represents 6.27 percent of taxable sales in Yuma County, 5.34 percent in Cochise County, 5.20 percent in Pima County, and 0.77 percent in Maricopa County. The larger the county in terms of population and income and the further away the county is from the border, the smaller the share of total taxable sales attributable to Mexican visitor spending.