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The downturn in business travel continues to plague hotels and other businesses and could be a drag on some city economies.
U.S. business travelers are scaling back travel plans amid rising Covid-19 cases, according to a national survey conducted for the American Hotel & Lodging Association.
The survey found that 67% of business travelers surveyed are planning to take fewer trips, 52% are likely to cancel existing travel plans without rescheduling, and 60% are planning to postpone travel plans.
Despite an uptick in leisure travel this summer, the report says the same is not expected until 2024 for business travel and events, which account for more than half of hotel revenue.
The lack of business trips has major repercussions for both hotels and communities, according to the association. U.S. hotel employment this year is expected to be down nearly 500,000 jobs compared to 2019, which means an additional 1.3 million hotel-supported jobs also are at risk.
For cities that are normally major hubs for conferences and other business travel, the lull in activity could hurt tax revenues.
Other key survey findings show that business travelers are likely to take shorter trips (68%) and only travel to places they can drive to (66%).
The survey also asked respondents if they would be attending large gatherings, meetings and other events, which are big drivers of hotel revenue. The findings show that they are likely to:
- Attend fewer in-person events or gatherings (71%).
- Have shorter meetings or events (67%).
- Postpone existing meetings or events until a later date (59%).
- Cancel existing meetings or events with no plans to reschedule (49%).
According to a Deloitte survey, corporate travel is projected to remain at only 30% of 2019 levels through the end of 2021.
The lack of business trips could cost the hotel industry $59 billion in 2021, underscoring the need for federal relief, according to the association. It points to the need for passage of the Save Hotel Jobs Act introduced in the U.S. House in May, but it is stalled in committee.
Spending on business travel plummeted 70% in 2020 as a result of the coronavirus pandemic, cutting into the tax revenues of many tourism-dependent states, Tori Emerson Barnes, executive vice president of public affairs and policy at the U.S. Travel Association, told a Senate subcommittee in April.
“Hotels were already on pace to lose more business travel revenue this year than we did in 2020. And now rising COVID-19 cases threaten to further reduce the main source of revenue for our industry,” Chip Rogers, president and CEO of AHLA, said in a statement.
The AHLA survey of 2,200 U.S. adults was conducted Aug. 11-12. For more information from the results click here.
Jean Dimeo is managing editor of Route-Fifty.