Recovery of Tourism-Based Economies on the Texas Gulf Coast after Hurricane Harvey

Publication Date: 2019

Abstract

The summer tourist season plays an important role in Texas Gulf Coast economies; the Fourth of July holiday week serves as the peak of summer tourism activities. Independence Day celebrations generate considerable sales for small businesses and provide an important source of tax revenue for local municipalities. Both income sources supply communities with needed funds to sustain their operations through the coming off-season. The 2018 summer season was important for businesses that suffered damage at from Hurricane Harvey (August 2017). Income generated from sales during the Fourth of July holiday week will aid communities in their long-term recovery efforts following Hurricane Harvey. Small business owners and chambers of commerce in coastal areas affected by Hurricane Harvey identified the 2018 Fourth of July holiday week, in particular, as a pivotal measure of business recovery, as well as an important indicator of which businesses will remain open following the summer season. This research focused on small business recovery in Rockport and Fulton, Texas, during the 2018 Fourth of July holiday week and examined recovery from the perspective of tourists and small business owners to identify business recovery trajectories during this key week and to benchmark business operational statuses for longitudinal recovery monitoring.

Introduction

Small businesses are vital to local economies and their recovery after an environmental disaster is an important step in the recovery of the more widely impacted community. Small business disaster recovery, however, is often uneven and fragmented compared to larger businesses (Tierney 2007). Therefore, it is important to understand how and why small businesses recover after environmental disasters. Initial recovery (e.g., open and closed status in the first few months following a disaster) is an indicator of a business’s recovery trajectory, yet the success or failure of small businesses cannot be established too early in the disaster recovery process (Brown et al. 2008, Schrank et al. 2013, Marshall and Schrank 2014¹). Businesses may initially rebound after a disaster event but fail in the future because of a number of factors. Factors contributing to business success or failure after a disaster are highly dynamic and interwoven. Small business recovery then is dependent on synergistic relationships between the business and “the community, the owner’s family, and its customers and suppliers” (Marshall and Schrank 2014, 598). Each factor plays an important role in the long-term success of recovering businesses as well as community recovery overall; however, small business recovery in tourist-based economies is tightly linked to the return of its customer base.

For communities along the Texas Gulf Coast affected by Hurricane Harvey and dependent on seasonal tourism from those who winter in Texas and summer visitors, Independence Day marked a pivotal point in their recovery experience. For small businesses, in particular, the revenue earned during this holiday as well as their capacity to meet tourist demands directly reflected their recovery from Hurricane Harvey and likelihood for continued operations following the summer tourist season.

Research Questions

This research primarily seeks to understand how business owners in Rockport prepared for the 2018 summer tourist season and how tourists perceive business operations and capacity during the Fourth of July holiday week. In this study, we move away from pre-disaster planning to ascertain factors that lead to post-disaster successes by answering the following questions.

1. According to owners/managers/senior personnel, how well prepared are their businesses for the first peak of summer tourist season (the Fourth of July holiday) following Hurricane Harvey?

   i. To what extent have they been able to return their businesses to pre-Harvey conditions?

   ii. Have they made any changes to a) infrastructure/equipment or b) business/marketing models in response to post-Harvey conditions?

   iii. How important do they feel the Fourth of July holiday week customer traffic and spending are as an indicator of overall recovery?

2. According to tourists/visitors, to what extent do local businesses appear to be recovered following Hurricane Harvey?

   i. Given their experiences and perceptions during their Fourth of July holiday week visit, how likely are they to return to the Texas Gulf Coast for a future vacation?

Methods

We conducted semi-structured interviews with tourists and businesses in the small coastal communities of Rockport and Fulton, Texas, over the Independence Day holiday from July 3 to 5, 2018 (Ruben and Ruben 2012²). Tourist interviews occurred at popular attractions in public space. We designed the interviews with tourists to identify their perceptions of the 2018 tourist season and to record their basic demographic information. These brief interviews lasted three to five minutes, on average. The semi-structured interviews with businesses ranged from five minutes to an hour in length and sought information regarding their operational status, preparations for the holiday week, and perceptions of business recovery. Detailed notes were taken of the interviews and later transcribed. We analyzed the transcripts using content analysis (Krippendorff 2004³) to identify and describe patterns elicited during the interviews.

Results

We interviewed 61 tourists and 18 business owners/senior personnel over the Fourth of July holiday week—Tuesday, July 3 to Thursday, July 5, 2018— in Rockport and Fulton, Texas. We identified 201 businesses in the Rockport-Fulton area related to the tourism industry (e.g., restaurants, hotels, bars, and retailers) as reported by a summer 2018 Rockport-Fulton Chamber of Commerce publication. We observed that 15 of these businesses were not open during our field work. Many of the closed businesses represented the hotel and restaurant industries; these observations were reinforced through our interviews with tourists and businesses. Using the Rockport-Fulton Chamber of Commerce publication, our interviews represent approximately nine percent of the tourism-based industries in the area and include retailers, fishing guides, hotels, and restaurants.

Tourists

Primary interview locations for tourists included a state park (11 interviews), historic business district (14), and a popular beach area (36 interviews). Of the tourists interviewed, the average age was 45.4, the mode was 40, and the range was 19 to 75 years of age. We spoke with 32 females and 29 males. The interview participants appeared in groups from two to 20 people, with an average size of 2.5; in total, the participants represented 166 people. On average, the tourists vacationed 4.2 days in the Rockport-Fulton area, with a range from one to 10 days. The interview participants represented 20 different communities within Texas, with the majority of the tourists from San Antonio (39.3 percent) followed by Austin (11.4 percent).

Of the 61 interviewed tourists, 13.1 percent identified that they “come every year,” while 16.4 percent owned a second home in the Rockport-Fulton area or had a family member who owned a home in the area. Over 24 percent of the tourist participants were first time visitors to Rockport-Fulton. The first-time visitors were predominately female, with an average age of 43 years; the majority were from Austin and staying approximately 3.4 days. Although, we spoke with these first-time visitors at all interview locations, this group commonly referenced the beach as a motivating factor for selecting Rockport-Fulton for their vacation. Specifically, one participant from Austin said she "wanted to be at a beach close to home.” Others mentioned “kids” or “family-friendly” as a motivation for selecting Rockport over other locations. One couple explained that they "googled best places in Texas for families” and liked that there is "no alcohol [allowed] on [the] beach" in Rockport. Two of the first-time visitors answered that they likely would not return to Rockport-Fulton for a future vacation, citing a preferred fishing location elsewhere in Texas. One visitor elaborated that they did not “like that the RV park [had] no lights for fishing and the pier [was] under construction.”

When asked their reasoning for selecting Rockport-Fulton for their Independence Day holiday location, two major themes emerged. The first theme was that the area is “family-friendly” and a good location to bring children. This was a common explanation among both first-time visitors and those who regularly visited the area. The second theme identified spoke to the uniqueness and local art scene prevalent in Rockport-Fulton. One tourist commented that Rockport-Fulton has a “more small-town feel. No junky T-shirt shops, more artsy. Corpus and Galveston sell the same stuff; here it's made by local artists. Beaches are nice, not too crowded, fishing is good." Another tourist described the area as “more quiet; it’s not as commercial as Corpus Christi or Port Aransas, slow paced.”

When asked how Hurricane Harvey recovery was going in Rockport and Fulton, participants frequently stated it was going “pretty well.” Although we asked an open-ended question, we organized the responses into a five point Likert scale (see Table 1).

Table 1. Tourist Perspective on Hurricane Harvey Recovery in Rockport and Fulton, Texas.

Several tourists mentioned difficulty finding restaurants open for meals, especially for dinner. Our observations echoed these comments. We observed restaurants that had to close early because they ran out of food supplies or lacked employees to work the holiday shifts (see Figure 1). This not only impacted tourists’ experiences, but also limited the potential earnings of small businesses in the area and affected local sales tax revenue.

When asked if they noticed any visual reminders of the Hurricane Harvey recovery during their vacations, all tourists indicated that they did observe some reminders (see Table 2). One tourist commented that the reminders are "everywhere you look," and that Houston flooded, but “this area took the brunt of the damage" from Harvey. Another tourist qualified her perception by stating, “looks like [its]…cleaned up….back to going from vacation perspective, maybe not residents’ perspective."

The examples tourists provided of the visual reminders primarily focused on the damage to the built environment, but some also recognized the loss of trees (15.3 percent), specifically the palm trees (see Figure 2). The references to the loss of trees and vegetation occurred at all interview locations but were especially prevalent in the interviews at the state park. One respondent who was camping for the holiday week looked up overhead at the spotty tree canopy when we asked about visual reminders of Hurricane Harvey. She highlighted the "absence of trees," and noted that the "natural aspects are different” than during previous visits. It was very noticeable to her group “because [they] stay every year.”

Despite a focus on damage and loss, several interview participants noted positive signs of recovery moving Rockport towards normal operations (5.5 percent). One participant commented that he “see[s] houses with new paint, [people] working on housing,” while another participant with a vacation home in Rockport said, “more things opened this week, seen a lot of ads. But people do not believe it’s open or better [in Rockport] than Houston. More people than I thought [are here], but less than past years at the beach. Some shops opened up just for this week.”

Table 2. Visual reminders of Hurricane Harvey visible on the landscape as reported by tourists.

Businesses

Our small business interviews, coupled with observations of local businesses, revealed an uneven recovery for many owners and sectors of the economy. Business owners expressed concern with a lack of tourist accommodations and employee housing. We observed 11 hotels still closed in the Rockport-Fulton area during our field work (see Figure 3). Throughout our interviews, many business owners lamented that there were not enough accommodations—including hotel, rental, and RV accommodations—available for tourists. One business owner commented that “generation after generation comes to Rockport, [people] bring [their] kids. [It’s a] family thing…many of those homes are gone. Where are they going to stay? Goose Island is always packed, still, people hesitant to come here."

In addition to the lack of hotel, rental, and RV accommodations, other business owners commented that a lack of housing for employees has left the area with a limited workforce. One owner explained that they “couldn't open more than two days [a week], because couldn't find employees, employees didn't have places to live. Going to rebuild apartments, that good news, gives people homes.”

Many business owners mentioned the summer tourist season started slow and were cautiously optimistic that the Fourth of July holiday week would bring an increase in tourist traffic and sales. Some businesses were breaking records, while others were struggling to sustain operations. Business owners of hotels and restaurants open prior to the holiday reported a strong summer season. One hotel owner commented that they are “normally pretty full, but not necessarily middle of the week like this…[we were] expecting it because the last couple months exceeding last year's revenues and bookings. Been busy last few months. Breaking records because people finding us because normal properties they stay at are not open…[we’re] hoping to convert them to future return guests.” Yet retailers and fishing guides reported lower than average sales for the holiday week. One retailer commented that they were "doing really good last year, it’s changed since the hurricane. Was considering more room; now, can we maintain this one?" Additionally, several bait shops and fishing guides also commented that low availability of live bait shrimp in the bays and estuaries of the Gulf of Mexico hurt their business. ⁴

Possible Applications of Findings

The purpose of this study was to understand how tourists perceive business operations and capacity following Hurricane Harvey. Additionally, we sought to determine how local business owners prepared for the summer tourist season and how they feel tourists have responded to the recovery process. The tourists’ perspective of recovery provides important information about the recovery process. Coupled with business owner insights, visitor experiences highlight areas that need attention and areas that are meeting their needs. Our preliminary findings provide some initial implications for tourism-based economies recovering from a disaster.

Many tourists return to the Rockport-Fulton area annually. Most of these visitors indicated that they would “absolutely” return to the area in the future. This highlights an important constituent in the recovery process. These serial tourists indicated feeling like they are part of the community and had an obligation to support the community during the recovery process. Efforts should be made to connect these tourists to the local community in a way to inform them of recovery milestones. Future research should seek to better understand this relationship between repeat tourists and recovering communities.

Both tourists and business owners expressed frustration with a lack of rental accommodations. Business owners suggested that more robust visitor numbers, and sales, could have occurred with more tourist accommodations open for business. This underscores the necessity of small tourism-based communities to address limited accommodations during the recovery process. A central listing of open and operational accommodations with alternative options in nearby communities would aid tourists looking for local accommodations. Similarly, tourists noted difficulty finding open restaurants. Despite efforts by the Rockport-Fulton Chamber of Commerce, tourists did not know where to find updates on local businesses and their operating hours. Furthermore, the accommodation issue also underscores the need for local workforce housing to keep open businesses fully staffed.

Tourists and local residents expressed frustration with the continued closure of public amenities related to major tourist activities and attractions. Public fishing piers and the pavilion at the popular beach location remained closed. This research identifies that tourists expect municipalities to prioritize reconstruction and repair of public facilities catering to tourists if advertising that the destination is ready for visitors.

Conclusions

Small tourism-based economies operate optimally when business sectors catering to tourists (e.g., hotels, restaurants, and other tourist facilities) work together to provide visitors with positive experiences. Obstacles encountered in one sector might impact perceptions of other business sectors, as well as visitors’ impressions of the destination. In particular, uneven recovery across public and private sectors in the Rockport-Fulton area after Hurricane Harvey affected tourists’ experiences in a variety of ways. Understanding these experiences at varying locations across the municipal landscape, along with their motivations for visiting tourist destinations recovering from disasters, allows communities to focus on specific areas to enhance tourist experiences and help small businesses in the service sector recover.

Plans for Future Work

This field work is an important step in operationalizing Marshall and Schrank’s (2014) Small Business Disaster Recovery Framework (SBDRF) to assess long-term small business recovery in Rockport and Fulton, Texas. The framework provides researchers with a conceptual model to compare and contrast small business recovery at multiple time intervals after a disaster event. At each interval, business operating status (i.e., operating, not operating, demised, survived, recovered, or resilient) is documented, along with characteristics related to their current status. For our study area, we will incorporate characteristics related to customer experience, as well as business owner accounts. The data we collected during the 2018 Fourth of July holiday week serves as one time interval during the recovery process and as an important benchmark to identify which businesses recover over the next year and to what extent. We will continue to interview business owners and tourists over the next year to gauge recovery and business success rates and compare future findings with perspectives gathered

References