The Contribution of the Tourism Sector to the Regional Spatial Economy During the COVID-19 Pandemic

The findings in this study are divided into four parts as follows: 1. The results of the Klassen Typology analysis based on the Regencies/Cities in North Sumatra to examine the economic growth position of Karo Regency before and during the pandemic; 2. The analysis was based on the business field to examine the position of business sectors related to tourism and hospitality; 3. LQ analysis results, which was used to compare the advantages of these sectors with others before and during the pandemic; and 4. The results of the Shift-Share analysis to examine the growth rate of business fields in the observed area, including in the tourism and hospitality sectors.

3.1 Karo regency spatial economic classification based on Klassen typology

The results of the Klassen Typology classification for the economy of Karo Regency before the pandemic are shown in Figure 1. It can be seen that Karo Regency is in quadrant IV, which indicates that the level of economic growth and GRDP in the area is lower than that of North Sumatra Province.

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Figure 1. Spatial economic growth before the pandemic

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Figure 2. Spatial economic growth during the pandemic

Furthermore, Figure 2 shows that Karo Regency was in quadrant IV during the pandemic. This means that there was no significant change in the economic growth level in the area both before and during the pandemic. In other words, the pandemic did not significantly affect the spatial economic growth pattern and structure in this regency. The analysis result also indicates that the observed area has a lower level of economic growth and per capita income than the average for North Sumatra.

Further information on GRDP and growth rate in Karo Regency was obtained from the average data of all Regencies/Cities in North Sumatra from 2016 to 2021, as shown in Figure 3.

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Figure 3. The growth of karo regency and the average of north Sumatra for the 2016-2021 period

Figure 3 shows that the income and growth level of Karo Regency has been below the economic average of North Sumatra since 2016. However, the spatial economy increased in 2017 and significantly decreased in the following years. This data is in line with the findings related to the Klassen Typology theory which showed that the economic growth and per capita income in this regency are lagging or below the average for North Sumatra.

3.1 Classification of the tourism sector in karo regency with Klassen typology

Figure 4 shows that the growth of the spatial economic sector related to the tourism industry, which is represented by the accommodation and food & beverage, was in quadrant III before the pandemic. This implies that it is included in the developed and depressed sectors. These results illustrated that although this sector is relatively advanced, it recently experienced a decline in its growth rate.

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Figure 4. Economic sector growth in karo regency before the pandemic

Figure 5 shows that the economic sector is in quadrant IV during the pandemic. This finding also confirmed how devastating the pandemic's impact was on Karo Regency's tourism sector. During the pandemic, several raids were conducted, hence, visitors from the surrounding area were not allowed to visit this region. This restriction became the main factor that influenced the decline of income in the accommodation, food, and beverage sectors, which is a representative of the tourism industry.

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Figure 5. Economic sector growth in karo regency during the pandemic

3.2 Classification of the leading sector of karo regency with location quotient (LQ) analysis

The basic logic of LQ analysis is the economic base theory, which is used to produce goods and services for markets within and outside the associated region to generate income through sales. Furthermore, the flow of income from outside this area increases the consumption and investment rate, which raises income and creates new job opportunities. This income increase demand for primary and non-basic industries [23]. Table 4 shows the details of the pre-pandemic LQ analysis period in Karo Regency based on 2019 prices.

Table 4 illustrates that the accommodation and food & beverage industries were the leading sectors before the pandemic. Meanwhile, the analysis of the tourism industry during the pandemic is shown in the following table (Table 5). Table 5 shows that the accommodation and food & beverage provision sectors were included in the top category during the pandemic. This implies that both before and during the pandemic, these sectors thrived and were able to promote the growth of others.

Table 4. Pre-pandemic LQ analysis (Based on 2019 prices)

Table 5. During pandemic LQ analysis (Based on 2021 prices)

3.4 Competitiveness of tourism-related sectors in karo regency with shift-share analysis

Quantitative calculations were carried out for Shift-Share analysis to determine the changes that occurred in the regional economic structure relative to the higher administrative area as a comparison or reference. This analysis was conducted using three basic related information. The first is the provincial reference economic growth, which shows the influence of the higher region's economic growth on the observed region (Karo Regency).

The second is the proportional shift which illustrates the relative change in the performance of a sector in a particular area under local or national references. Proportional shifts, also known as industrial mix effects, are used to determine whether the regional economy is concentrated in industries that grow faster than those used as a reference.

The third is the differential shift, which provides the information used in determining the distance between the competitiveness of regional (local) industries with the economy used as a reference. The result showed that when an industry's differential shift is positive, it is relatively more competitive than the reference economy. The differential shift is also known as the competitive advantage effect.

Furthermore, the results of the Shift-Share analysis for Karo Regency both before and during the pandemic are shown in Table 6. The proportional shift component analysis showed that the accommodation and food & beverage sectors were in the fast growing categories before and during the pandemic.

Additionally, a differential shift analysis was performed to examine the changes in a particular sector/industry due to its improvement in a higher reference area. A region with higher growth in a sector indicates that the activity is competitive with a positive differential shift and vice versa. The differential shift component arises due to an increase or decrease in the value of production sectors in a region compared to others. When compared to other regions, this shift's fast or slow process is dependent on the region's comparative advantages, market access, as well as social and economic infrastructure.

Following this, the results of the differential shift analysis indicated that the accommodation and food & beverage sectors had no competition before the pandemic. These sectors, however, experienced this process during the pandemic from 2020 to 2021 due to faster shift growth. Lastly, based on the analysis of Klassen Typology, LQ, and Shift-Share above, it can be seen that tourism-related sectors play a major role in supporting economic activities such as the production of goods and services.