Effects of COVID-19 on the Tourism Sector: Learning from the Azores Islands

Abstract

This research aims to examine the impact of COVID-19 on businesses operating in the tourism industry in the Azores. The objective of this survey, conducted in 2021 and 2022, was to investigate the preventive and management measures implemented by the tourist firms, in this outermost region of Portugal, in response to the pandemic, along with the effects on profitability. Additionally, the study aims to assess the contribution of financial support from the regional government toward these businesses’ sustainability and anticipate future expectations. The temporary closure of businesses was the most frequently adopted measure by the firms to adapt to the ongoing pandemic. Most companies reported a significant decline in profitability, with a reduction in customers being the primary contributing factor. Most firms availed themselves of the preceding financial support structures provided by the regional government. Looking forward, the firms expressed their intention to retain their current employees. At the same time, their biggest concern was the potential decrease in consumer demand, even in the context of well-established public health safety protocols.