The state's growing tourism industry faces a major shortfall of labour amounting to 10,000 jobs within three years, a new report into the health of the state's visitor economy has warned.
Tourism generates more than $37 billion in consumption and nearly 270,000 jobs in the NSW economy each year, according to the NSW Business Chamber's mid-term report card on the tourism economy.
Income generated from international visitors is rising particularly quickly and grew more than 15 per cent in the last year to reach more than $16 billion.
But the chamber warns that the growth has left the state exposed to both a looming skills shortage and needing to diversify its attractions beyond Sydney.
"It is critical the government start now to boost participation in the existing workforce," the report finds.
Growth in the NSW tourism sector is projected to require an additional 40,000 jobs by 2020 but on current trends the supply of workers is expected to fall 10,000 short. The state is already under-supplied with skilled cookery and accommodation workers, the report finds.
The report also says more should be done to lure international visitors, particularly from the booming Chinese market, to areas beyond Sydney to lengthen their stays.
"If the NSW government is to grow regional tourism, it needs to provide the funding and policy attention that's needed, starting with a strategy to boost the dispersal of the lucrative Chinese market," said the executive manager of the NSW Business Chamber, Dean Gorddard.
"[Regional] tourism operators often lack the necessary support to market their products," he said.
The NSW Riverina and the Northern Rivers region are largely untapped as potential destinations, the report finds.
The Chamber recommends the state government devote more of its windfall from the sale of the state's poles and wires to building more regional infrastructure with tourism in mind and publish a plan to develop events outside Sydney.
The report also calls for changes to the way the tourism sector is governed.
In addition to repeating calls for streamlining bureaucracy and more land release, the report finds the state's tourism strategy is lacking.
Sydney is the only major Australian city without an overarching "destination management plan" and it calls for the establishment of a new cabinet sub-committee devoted solely to tourism.
NSW Tourism Minister Adam Marshall said that the state government had already announced two separate funds for developing regional tourism infrastructure and growth with combined budgets of more than $400 million.
"Growing tourism in rural and regional NSW is a top priority for the NSW government," Mr Marshall said.
Figures released on Thursday showed that regional NSW had 21 million visitors last year who delivered $10.2 billion in consumption revenue, a result Mr Marshall hailed as a record high.
NSW recorded the highest increase in domestic overnight visitors of any state last year, according to the National Visitor survey.
