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               Researh Sevice






COVID-19 and the Cruise Ship Industry



March 16, 2020
The cruise ship industry has been heavily impacted by coronavirus disease 2019 (COVID-19). Major
cruise lines have canceled trips from U.S. ports over the next month. In recent weeks, several cruise ships
have been quarantined offshore and U.S government health officials have advised against cruise ship
travel for the time being. These events have raised questions about government oversight over the cruise
industry, the potential economic harm the coronavirus could have on the industry, and whether the
industry is largely America- or foreign-based.

Employment in the Cruise Ship Industry

While most of the major cruise lines are incorporated or otherwise domiciled in foreign countries, they
have headquarters in the United States, with office staff who handle advertising, sales, bookings, and
vessel planning. According to federal government data, Miami has the largest contingent of workers
employed by the cruise industry (North American Industry Classification System code 483112), with Los
Angeles and Washington State as secondary centers of employment. In terms of number of cruise ship
port calls in 2018, Florida was the leading state with over 3,000 port calls, followed by Alaska with nearly
2,000, and California with over 500. Puerto Rico also had over 500 cruise ship port calls, and the U.S.
Virgin Islands nearly 500. Ship chandlers are another significant employer in port areas, as they supply
navigation-related parts and equipment as well as food, beverages, linens, and other passenger-related
supplies.
Although U.S. nationals are employed in the onshore business segment of the cruise industry, in the
offshore segment (aboard ships), foreign workers fill most positions. Almost all oceangoing cruise ships
calling at U.S. ports are foreign-flagged, meaning they are registered in foreign countries, and
particularly in open-registry countries such as Panama, Bermuda, Malta, the Bahamas, and the Marshall
Islands. While US. law requires that passengers being transported from one U.S. point to another U.S.
point be carried in only U.S.-built, -owned, and -crewed vessels, this law does not apply to cruise ship
voyages that include foreign port calls or that embark and disembark passengers at the same dock. Plus,
Puerto Rico and the U.S. Virgin Islands are exempt from this law. Open registries allow cruise ships to
crew and staff their vessels with citizens other than from the registering country, and these registries
generally assess lower fees and taxes. The Philippines is a popular home country for many ship crews,
particularly sailors, engine room mechanics, and hotel and food service workers. U.S. nationals are more
likely to be hired as entertainers on ships catering to American passengers. A cruise ship with thousands
of passengers can have a staff and crew of several hundred or more on board.
                                                                  Congressional Research Service
                                                                    https://crsreports.congress.gov
                                                                                        IN11245

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