Economists Catalina Barceló and José Antonio García yesterday presented results from a study into the economic impact of the Playa de Palma area. The study has taken account of all activities and has provided, for the first time, an estimation of the economic contribution made by Playa de Palma.
The notional GDP is 3.16% of total Balearic GDP as it was in 2017. As Majorca accounts for 80.7% of GDP, Ibiza and Formentera 12.9% and Minorca 6.3%, Playa de Palma's contribution is equivalent to half that made by Minorca. In real numbers, this means 1,437 million euros, of which 996 million are direct and 441 million indirect.
Thirty per cent of this total impact comes from hotels (438 million euros). Of other sectors, 139 million euros are contributed by real estate (property sales and rents); 130 million come from retailing; 128 million from construction; and 123 million from the restaurant sector.
In terms of wider economic impact, the hotel industry in Playa de Palma, with its 438 million euros valuation, accounts for 17% of all hotel GDP in the Balearics. The retail activity in the resort area is six per cent of total retail GDP.
With regard to employment, the study calculates 11,806 jobs, of which 8,180 are direct. Almost one in three of these jobs is in the hotel sector. By contrast, construction and restaurants each account for 9.5% of jobs.
A regular complaint made by hoteliers in Playa de Palma is that public-sector investment has been nothing like on the scale of that by the private sector. The study draws on figures from the Playa de Palma Hoteliers Association in showing that 120 million euros of private-sector investment has been made over the past five years, while the public sector has been responsible for around one million per annum.
