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Wave after wave of infections and a third state of emergency are pummeling hotels and travel agencies in Japan, decimating sales and leaving the tourism industry drowning in a sea of red ink.

According to the results of an online survey released Tuesday by the Japan Tourism Agency (JTA), more than 40% of respondents in the hotel business said reservations plummeted by over 70% between January and May this year compared with the same period in 2019.

Meanwhile, figures were even worse for travel agencies, with around 80% saying reservations have fallen by more than 70% during the same period compared with 2019.

The questionnaire, conducted between April 19 and 22, garnered responses from 5,467 hotel operators and 3,117 travel agencies taking part in the government-sponsored Go To Travel campaign, a subsidy program aimed at promoting domestic tourism.

Ken Nagamine owns Yamanosho, a traditional ryokan inn in Hakone, a hot-spring mecca in Kanagawa Prefecture. He said the number of reservations had been down by 80% over the past few months compared with a regular year. Even during the Golden Week holidays, from late April to early May, when tourist destinations would typically be crowded, only around half of the inn’s 10 rooms were occupied, he said, as vacation-goers were urged to stay home to curb contagion risks.

“And that’s with discount offers,” he said. “Many of the ryokan in my area are now only open during the weekends.

“The streets are empty. It’s pretty hopeless, and I don’t know when things will recover.”

A poster for the government's Go To Travel tourism campaign is displayed on a street in Osaka in November 2020. | KYODO
A poster for the government’s Go To Travel tourism campaign is displayed on a street in Osaka in November 2020. | KYODO

Looking more closely, 42.3% and 43% of hotels and inns surveyed said reservations slid by more than 70% in January and February, respectively. That fell to 31% in March, when virus counts saw a temporary lull, before climbing back up to 42.3% in April. The figure is expected to reach 47.2% in May.

The government enacted its third state of emergency on April 25 as case counts soared. The emergency decree is slated to last until May 31.

For travel agencies, the percentage that said reservations dropped by more than 70% was 81.4% in January, 84% in February, 76% in March and 81.5% in April. In May, the figure is expected to climb to 84.2%.

The JTA said in its report that the suspension of Go To Travel, which some experts have said was behind a surge in virus infections, was partially responsible for the drop in reservations. The program, which aimed to address the economic fallout from the pandemic, was suspended on Dec. 28 and it remains unclear when it will resume.

The hospitality sector has been battered by coronavirus-induced travel restrictions and stay-at-home requests. According to Teikoku Data Bank, the number of lodging businesses that went bankrupt in fiscal 2020 was 125, a 66.7% jump from the previous year and the highest rate of increase on record.

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