Cautious optimism in tourism: the economy improved in May, but the sector is still in the red

By: Trademagazin Date: 2025. 06. 05. 11:52

In May 2025, Hungarian tourism businesses reported a slight improvement in confidence: the Tourism Confidence Index (TKI) reached -3 points, up from -8 in April. Although still in negative territory on the -100 to +100 scale, this value is a step closer to neutral and 7 points below last year’s level.

Mixed Performance Across Sub-Sectors

The three sub-sectors of tourism showed varied results:

The accommodation sector improved by 5 points to -7,
The catering sector rose by 7 points to -2,
The other tourism services sector reached 0 from a previous -5.

However, the year-on-year comparison shows a declining trend: accommodation fell 10 points, other tourism services dropped 13 points, while catering remained flat.

Performing Better Than Other Industries

Interestingly, the May TKI outperformed other key economic indices:

The EU-focused GKI services confidence index (-8 points),
The general business confidence index representing the whole economy (-14 points),
As well as sector-specific figures like industry (-14), construction (-27) and retail (-25).

Employment Outlook: Mild Optimism

The employment expectations index in tourism stood at +9 points in May—above the service sector average (0) and the overall business average (-3). This places tourism close to retail (10) and ahead of construction (-9) and industry (-5).

Prices and Costs Keep Rising

About 70% of businesses reported price increases in the past three months, while 26% saw no change and only 4% lowered prices. The average price hike was 7%, slightly above the April rate.

Operating costs rose even faster: 66% of respondents reported increased expenses, 32% reported no change, and just 2% saw a drop. The average cost increase was 15%, also above the previous month’s figure.

A Barometer of Tourism

The Tourism Confidence Index is published monthly by the VIMOSZ (National Association of Tourism Employers), the Hungarian Tourism Association Foundation, and the GKI Economic Research Co. It aims to provide up-to-date insights into sectoral expectations, supporting both strategic planning and policy decisions.