Dissertation – Sustainable Tourism and Community Wellbeing in Regional Australia

Abstract

Regional tourism is central to Australia’s visitor economy, yet rapid growth in high-visitation destinations has renewed debate about the social limits a community can absorb. Framed by social exchange theory and the concept of social carrying capacity, this dissertation examines how residents of a tourism-dependent coastal community in regional New South Wales evaluate the benefits and costs of tourism, and how those evaluations relate to their support for further development and to their personal wellbeing. An explanatory sequential mixed methods design combined a resident survey (n = 297) with 16 stakeholder interviews. Survey results showed strong perceived economic benefits alongside high perceived crowding, with support for tourism predicted most strongly by economic dependence and mean wellbeing sitting marginally below the Australian normative range. Interviews identified housing displacement, amenity loss and infrastructure strain as the mechanisms through which peak-season saturation erodes wellbeing. The study argues for managed, dispersed growth consistent with national visitor-economy strategy.

Introduction

Tourism is one of the pillars of regional Australia’s economy, sustaining employment, small business and public revenue in communities that have few alternative industries, a contribution quantified in the regional tourism satellite accounts (Tourism Research Australia [TRA] 2023). National strategy has explicitly tied recovery and future prosperity to a larger, better distributed visitor economy, with Austrade’s long-term plan setting an ambitious expenditure target and emphasising the dispersal of visitors beyond the major gateways into regional destinations (Austrade 2022). Destination marketing bodies at both national and state level have pursued that agenda, encouraging travel into regional areas as a matter of policy (Tourism Australia 2023; Destination NSW 2023). For many coastal and hinterland communities, the result has been visitor numbers that, in peak periods, exceed the resident population several times over.

Growth of this intensity carries a paradox that is increasingly visible in Australia. The same visitation that underwrites local prosperity can, beyond a threshold, degrade the amenity, affordability and social fabric that make a place liveable, a dynamic captured internationally by the concept of overtourism (Milano et al. 2019). In tourism-dependent towns, seasonal saturation coincides with acute pressure on housing, as dwellings shift into short-term visitor accommodation and long-term rental supply contracts, a pattern consistent with regional population and housing trends recorded nationally (Australian Bureau of Statistics [ABS] 2023). Whether residents continue to support tourism under these conditions, and what the trade-offs mean for their wellbeing, is therefore a question of practical importance for destination management as well as theoretical interest. This dissertation investigates that question in one regional New South Wales community, guided by three research questions:

1. How do residents evaluate the perceived benefits and costs of tourism, and how internally consistent are these attitudes and their wellbeing?
2. Which perceived costs and benefits, and which resident characteristics, predict support for further tourism development?
3. Through what mechanisms does tourism intensity influence resident wellbeing in a high-visitation community?

Literature Review

Social exchange and residents’ attitudes

Social exchange theory has been the dominant lens for understanding residents’ reactions to tourism since Ap (1992) argued that residents evaluate the industry through a rational weighing of the benefits and costs they expect to receive. Where the perceived exchange is favourable, residents support tourism; where costs are seen to outweigh benefits, support erodes. A substantial body of work has since confirmed that perceived economic benefit is the most reliable positive predictor of support, while perceived social and environmental costs pull in the opposite direction (Nunkoo & Gursoy 2012). Crucially for the present study, the exchange is not evaluated uniformly across a community. Residents whose livelihoods depend on tourism perceive the balance more favourably, an asymmetry demonstrated in the Australian setting by Gursoy et al. (2010) in their study of the Sunshine Coast, where economic dependence sharpened support even as residents recognised the costs.

Carrying capacity and overtourism

If social exchange theory explains how residents evaluate tourism, the concept of carrying capacity explains why the evaluation shifts as visitation grows. Butler’s (1980) tourist area life cycle proposed that destinations pass through stages of development toward stagnation, at which point the physical, environmental and social capacity of the place is approached or breached and resident tolerance declines. Social carrying capacity, the level of use beyond which the host community’s quality of life deteriorates, is inherently subjective and place-specific, which is why it must be measured through resident perception rather than visitor counts alone. Contemporary scholarship on overtourism has reframed these breaches as the crowding, congestion, amenity loss and housing pressure that provoke resident opposition in saturated destinations (Milano et al. 2019). The Australian debate has increasingly borrowed this vocabulary, particularly in coastal communities where peak-season density is extreme.

Tourism, wellbeing and the research gap

A newer strand of research moves beyond attitudes to ask how tourism affects residents’ wellbeing directly. Woo et al. (2015) found that residents’ perceptions of tourism impacts shape their life satisfaction, which in turn feeds back into their support for development, positioning wellbeing as both an outcome and a driver of the exchange. Measuring wellbeing in the Australian context is well served by the Personal Wellbeing Index, a validated instrument with established national normative data (International Wellbeing Group [IWG] 2013). Two gaps remain. First, resident attitudes and resident wellbeing are usually studied separately rather than as linked outcomes of the same exchange. Second, comparatively little of the evidence is grounded in regional Australian communities experiencing the acute saturation that national dispersal strategy is now accelerating. This study addresses both gaps through a mixed methods design.

Methodology

Research design and conceptual model

An explanatory sequential mixed methods design was adopted (Creswell & Plano Clark 2018). A quantitative resident survey established the structure and predictors of attitudes and wellbeing, after which a qualitative stakeholder phase explained the mechanisms behind those patterns. The two phases were integrated at the interpretation stage through a joint reading of statistical predictors against interview themes. The study was organised around the conceptual model shown in Figure 1, which locates the social exchange evaluation as the pivot between tourism intensity and the twin outcomes of resident support and wellbeing, moderated by community attachment and economic dependence.

Participants and procedure

The field site was a tourism-dependent coastal community in regional New South Wales in which peak-period visitation greatly exceeds the resident population. Phase 1 recruited 297 adult residents through a stratified mail and online invitation to the local government area, quota-controlled for age, gender and length of residence to approximate the community profile recorded in regional census data (ABS 2023). Of the sample, 52% identified as women, the mean age was 44.8 years, and 40% (n = 118) reported that their household income depended wholly or partly on tourism. Phase 2 comprised 16 stakeholder interviews with a purposively selected group spanning local government and destination management, tourism operators, a residents’ association, real estate and housing, an environmental group, and emergency and infrastructure services, selected to represent the range of positions in the community rather than a single interest.

Measures and analysis

The survey measured seven constructs. Perceived economic benefits, socio-cultural costs, environmental costs, crowding pressure, community attachment and support for tourism development were assessed with multi-item scales rated from 1, strongly disagree, to 7, strongly agree, adapted from established resident-attitude instruments (Ap 1992; Nunkoo & Gursoy 2012). Personal wellbeing was measured with the seven-domain Personal Wellbeing Index, scored 0 to 10 (IWG 2013). Internal consistency was assessed using Cronbach’s alpha, with the conventional threshold of .70 taken to indicate acceptable reliability. Quantitative analysis comprised descriptive statistics, Pearson correlations, an independent-samples comparison by economic dependence, and multiple regression predicting support. The 16 interviews, of 40 to 60 minutes each, were transcribed and analysed using reflexive thematic analysis (Braun & Clarke 2021).

Ethical considerations

The study was approved by the administering university’s Human Research Ethics Committee, and procedures complied with the National Statement on Ethical Conduct in Human Research (National Health and Medical Research Council [NHMRC] 2023). Participation was voluntary and based on written informed consent, survey responses were anonymous, and interview participants were assigned pseudonyms. Because some stakeholder roles are potentially identifying, the local government area is not named and quotations are reported by role only.

Findings

Phase 1: Survey results

Table 1 reports the seven constructs. All scales were internally consistent, with Cronbach’s alpha ranging from .80 to .88, comfortably above the .70 threshold, which confirms that the attitude and wellbeing measures behaved reliably in this community. Residents perceived strong economic benefits (M = 5.62) but also high crowding pressure (M = 5.14) and environmental cost (M = 4.91), while overall support for further development was only mildly positive (M = 4.58), sitting close to the scale midpoint. The pattern of correlations was consistent with social exchange theory: support rose with perceived economic benefit (r = .54) and fell as perceived crowding (r = -.47) and environmental cost (r = -.41) increased.

Table 1: Attitude and wellbeing constructs, internal consistency and correlation with support (N = 297)

Note. Attitude constructs are scored 1 to 7 and the Personal Wellbeing Index 0 to 10, with higher scores indicating more of each construct.

Two results merit closer inspection. First, personal wellbeing can be benchmarked against Australian norms. Converting the sample mean to the 0 to 100 metric used for the Personal Wellbeing Index gives 7.21 multiplied by 10, or 72.1 points. Cummins’ normative range for Australian population samples runs from roughly 73.4 to 76.4 points (IWG 2013), so the community sits 73.4 minus 72.1, or 1.3 points, below the normative floor, a modest but notable shortfall for a prosperous coastal region. Second, the role of economic dependence was pronounced. Residents whose households depended on tourism reported markedly higher support (M = 5.31, SD = 1.31, n = 118) than those who did not (M = 4.12, SD = 1.46, n = 179). Expressed as a standardised mean difference using the pooled standard deviation:

d = (5.31 – 4.12) / 1.40 = 1.19 / 1.40 = 0.85,

a large effect by conventional benchmarks. In the regression predicting support, perceived economic benefit and economic dependence were the strongest positive predictors and crowding pressure the strongest negative predictor, together accounting for a substantial share of the variance and confirming that support in this community is a conditional exchange rather than a settled consensus.

Phase 2: Stakeholder interview themes

Reflexive thematic analysis produced six themes, summarised in Table 2. Stakeholders were unanimous that tourism was the community’s economic lifeline, yet equally emphatic that peak-season saturation had breached what several described as the town’s practical carrying capacity. As one local government planner put it, “in January the town simply stops functioning for the people who live here” (Participant 4). Housing displacement was the most emotionally charged theme: participants linked the conversion of long-term rentals into short-term visitor accommodation to the departure of essential workers and younger families, echoing the broader regional housing pressures visible in national data (ABS 2023). A residents’ association representative observed that “we are marketing for visitors we can no longer house our own workers to serve” (Participant 9). Amenity loss, infrastructure strain and a shared appetite for managed, dispersed growth completed the picture.

Table 2: Themes from reflexive thematic analysis of stakeholder interviews (n = 16)

Discussion

The findings answer the first research question by showing that residents hold a coherent and internally consistent set of attitudes: they recognise strong economic benefits while simultaneously registering high crowding and environmental cost, and their overall support is only tentatively positive. This is the ambivalence that social exchange theory predicts when a favourable economic exchange is offset by mounting social and environmental costs (Ap 1992; Nunkoo & Gursoy 2012). The reliability of the measures, with every construct exceeding the .70 alpha threshold, gives confidence that this ambivalence is a genuine community position rather than measurement noise.

The second research question is answered decisively by the role of economic dependence. The large standardised difference in support between tourism-dependent and independent households (d = 0.85) shows that the exchange is evaluated from materially different positions within the same community, reproducing in a regional New South Wales setting the dependence asymmetry that Gursoy et al. (2010) identified on the Sunshine Coast. Support is therefore not a single community sentiment but a distribution shaped by who captures the benefits and who absorbs the costs. This distributional reading matters for policy, because a dispersal strategy that grows aggregate visitation without addressing who bears the crowding and housing costs risks widening that internal divide (Austrade 2022; Destination NSW 2023).

The third research question is illuminated by the integration of the two phases. The survey located wellbeing marginally below the Australian normative floor, and the interviews supplied the mechanisms: housing displacement, amenity loss and infrastructure strain concentrated in the peak season. These map closely onto the overtourism literature, which frames precisely such crowding, congestion and affordability pressures as the point at which social carrying capacity is breached and resident quality of life declines (Butler 1980; Milano et al. 2019). The housing mechanism is the most consequential and the most distinctively Australian, given the documented contraction of regional rental supply as dwellings move into visitor accommodation (ABS 2023). It also closes the loop that Woo et al. (2015) describe, in which diminished wellbeing feeds back into weaker support, so that unmanaged growth is ultimately self-limiting for the visitor economy it is meant to serve.

Several limitations qualify these conclusions. The survey is cross-sectional, so the causal ordering among crowding, wellbeing and support cannot be confirmed. The study examines a single community, which strengthens depth but limits generalisation to other regional destinations. Wellbeing and attitudes are self-reported, and the economic-dependence measure is a broad self-classification rather than a precise income share. Finally, visitor perspectives were not sought, since the focus was deliberately on the host community.

Conclusion

This dissertation set out to understand how residents of a tourism-dependent regional Australian community reconcile the benefits of tourism with its costs, and what the resulting trade-offs mean for their wellbeing. The evidence describes a community that values tourism as an economic lifeline yet perceives itself to be at or beyond its social carrying capacity in peak periods, with support conditional on economic dependence and wellbeing sitting just below the national norm. Read through social exchange theory, the message for destination management is not that growth should stop but that it should be governed. Managed, dispersed growth of the kind envisaged in national visitor-economy strategy will only protect community wellbeing if it is paired with active management of the local costs, above all housing supply, seasonal saturation and infrastructure capacity (Austrade 2022; Tourism Australia 2023; Destination NSW 2023). Where those conditions are met, tourism can remain a favourable exchange for the communities that host it; where they are neglected, the erosion of resident wellbeing will, in time, undermine the destination itself.

References

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Austrade 2022, THRIVE 2030: the re-imagined visitor economy, Australian Trade and Investment Commission, Canberra.

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Braun, V & Clarke, V 2021, Thematic analysis: a practical guide, Sage, London.

Butler, RW 1980, ‘The concept of a tourist area cycle of evolution: implications for management of resources’, Canadian Geographer, vol. 24, no. 1, pp. 5-12.

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Gursoy, D, Chi, CG & Dyer, P 2010, ‘Locals’ attitudes toward mass and alternative tourism: the case of Sunshine Coast, Australia’, Journal of Travel Research, vol. 49, no. 3, pp. 381-394.

International Wellbeing Group 2013, Personal Wellbeing Index, 5th edn, Australian Centre on Quality of Life, Deakin University, Melbourne.

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National Health and Medical Research Council 2023, National statement on ethical conduct in human research, NHMRC, Canberra.

Nunkoo, R & Gursoy, D 2012, ‘Residents’ support for tourism: an identity perspective’, Annals of Tourism Research, vol. 39, no. 1, pp. 243-268.

Tourism Australia 2023, Corporate plan 2023-24, Tourism Australia, Sydney.

Tourism Research Australia 2023, Regional tourism satellite accounts, 2021-22, Tourism Research Australia, Canberra.

Woo, E, Kim, H & Uysal, M 2015, ‘Life satisfaction and support for tourism development’, Annals of Tourism Research, vol. 50, pp. 84-97.