THE BUSINESS TRAVEL revenue of U.S. hotels is expected to drop $20 billion this year, down 23 percent when compared to 2019, according to the American Hotel & Lodging Association and Kalibri Labs. It is already reported that hotels lost an estimated $108 billion in business travel revenue during 2020 and 2021 combined.
The report said that business travel revenue, the largest source of revenue in hotel industry, will take significantly longer to recover. However, leisure travel is expected to return to pre-pandemic levels this year, the report added.
“While dwindling COVID-19 case counts and relaxed CDC guidelines are providing a sense of optimism for reigniting travel, this report underscores how tough it will be for many hotels and hotel employees to recover from years of lost revenue,” said Chip Rogers, president and CEO of AHLA. “The good news is that after two years of virtual work arrangements, Americans recognize the unmatched value of face-to-face meetings and say they are ready to start getting back on the road for business travel.”
According to the report, urban markets have been disproportionately impacted by the pandemic, as they rely heavily on business from events and group meetings.
San Francisco, New York, Washington, San Jose, Chicago, Boston, Oakland, Seattle, Minneapolis and Philadelphia are the top 10 markets to end the year with the largest drop in business travel revenue.
A recent AHLA survey revealed that 64 percent of U.S. professionals and 77 percent of business travelers want to bring back business travel more than ever. The majority of respondents said face-to-face interactions are important for maximizing company success.
The AHLA report said that the largest drop in business travel revenue will be reported in Wyoming and the District of Columbia, followed by New York, Massachusetts, Illinois, New Jersey, California, Maryland, Minnesota and Washington.
A recent survey by USTA, stated that 84 percent of business travelers in the U.S. expect to take at least one trip to attend conferences, conventions or trade shows in the next six months.