Fires of 2023 burn holes in tourism operator pockets

The federal government says Canada's appeal as an international tourist destination has been damaged by the 2023 forest fire season, which was the country’s most destructive on record.

Foreign spending in Canada dropped in 2023 over pre-pandemic levels, according to documents obtained by Canada’s National Observer through the Access to Information and Privacy Act. In the Northwest Territories alone, 62 of 180 business members reported revenue loss of $8 million, and $1.8 million in increased costs directly attributable to wildfires in 2023, Innovation, Science and Economic Development (ISED) statistics show. 

Some of the drop likely resulted from travel advisories issued in 2023 by Germany and the United States. The United States also had air quality advisories for smoke from fires burning in Canada that drifted across the border. 

The document, a briefing note to the minister, singles out B.C. as one of the hardest-hit provinces. Tourism “suffered immensely” after two unprecedented fire events in the Okanagan and Mid-Island to Pacific Rim regions of B.C., when fires caused, respectively, a travel ban and highway closure. 

“Last year is a year I was trying my best to forget,” said Charles McDiarmid, Maître de Maison of the internationally renowned Wickaninnish Inn in Tofino, B.C. 

In June of last year, Highway 4, the only road connecting the towns of Port Alberni, Ucluelet and Tofino to the rest of Vancouver Island, was closed for more than two weeks due to a wildfire at Cameron Lake. 

Hotel occupancy rates plummeted in the tourism economy-driven town from 83 per cent in June 2022, to just 48 per cent in June 2023, according to the report from ISED. The Wickaninnish Inn was expecting to be 73 per cent full that month, and ended up running at just over half capacity. 

The effects of the road closure for the hotel carried into September — but for other tourism businesses, some of the impact is still being felt today, especially for adventure operators who McDiarmid says took the biggest hit during the highway closure. 

A few days into the closure, a forest service road detour was established for supply delivery trucks and adventurous travelers — about a four hour drive from Lake Cowichan to Port Alberni. But the damage for the season was already done, with many weddings and travel plans scrapped. 

Businesses in the affected towns suffered. McDiarmid grew up in Tofino and has been an active part of the tourism industry in the town for 28 years. 

“We haven't had a normal year since 2019,” McDiarmid said. “We're just happy to have a normal year this year.” 

By September 2023, the combined area of burnt forest in Canada was larger than Greece and cost $3 billion, according to the report. 

Last year, the Okanagan had travel restrictions issued in August. During that time, accommodation businesses were only permitted to host wildfire evacuees in the area. Okanagan businesses are still recovering from the financial loss during their busiest season, where hotel occupancy rates dropped eight percentage points in August compared to the previous year. 

Businesses rely on the summer months to carry them through the rest of the year, says Vinil Sood, executive director of the North Okanagan Hotel Association and manager of the Quality Inn and Suites in Vernon, B.C. for the past 11 years. 

“I still remember it almost looked like an Armageddon over here, and it really had an impact on our community,” Sood said. 

“We have over a million people coming into Vernon every single year. Majority of them come in the summertime. So having all of the smoke and fires that are going on either around Vernon or around the Okanagan, or even in B.C. in general, it definitely deters people from entering our area.”

Lower occupancy is driving margins down, too. Booking prices in 2024 are down 15 per cent from last year, says Sood, who also notes that vacationers are more hesitant to book in advance for fear of extreme weather disrupting their plans. Instead, travelers are booking just weeks in advance, making budgeting and planning more difficult for the industry. 

This was echoed by McDiarmid and Walt Judas, CEO of the Tourism Industry Association of B.C. 

“People have become accustomed to seeing wildfires over the years, and they're taking a wait-and-see attitude, so the advance bookings are quite soft in the Okanagan. People, in many respects, have chosen to go elsewhere rather than risk if there's going to be [a fire],” Judas said. 

In the briefing note, ISED describes a letter sent to the Canada Revenue Agency in 2023 from national business and tourism associations seeking support for small business owners due to increased costs and revenue loss from last year's wildfires across the country. It says the government doesn’t yet fully know the full effects of fires on the tourism industry.

McDiarmid is confident his small island town will make a complete recovery, and it is already well on the way. 

“Tofino is a very resilient town. Our nickname isn't ‘tuff city’ for nothing. And having grown up here we're pretty resilient, and we're used to dealing with occasional bouts of adversity and coming out the other end always positive,” McDiarmid said.