- Hotels’ business travel revenues are forecast to fall 66.2 percent in 2021 compared to pre-pandemic levels
- COVID-19 Delta variant expected to further dampen business travel this fall
- Hotel trade group says data shows the need for direct aid to hotel owners and operators
Summary by Dirk Langeveld
Business travel revenues at U.S. hotels will continue to lag well behind pre-pandemic levels, according to a report from a hospitality trade group. The industry is advocating for direct aid to the nation’s hotels, saying the loss of business travel income represents a major challenge.
The American Hotel & Lodging Association and Kalibri Labs are forecasting that hotels will lose approximately $59 billion in business travel revenues in 2021 compared to 2019 revenues. This would follow a loss of $49 billion in business travel revenues in 2020. The group estimates that business travel revenues will not recover to pre-pandemic levels until 2024.
“While some industries have started rebounding from the pandemic, this report is a sobering reminder that hotels and hotel employees are still struggling,” said Chip Rogers, president and CEO of AHLA. “Business travel is critical to our industry’s viability, especially in the fall and winter months when leisure travel normally begins to decline. Continued COVID-19 concerns among travelers will only exacerbate these challenges.
AHLA projects that the hotel industry will end the year with half a million fewer jobs than it had in 2019. In addition, the group recently issued a survey that found a significant pullback from business travel due to the spread of the COVID-19 Delta variant. Sixty-seven percent of respondents said they were planning to take fewer trips, 60 percent were planning to postpone their existing travel plans, and 52 percent said they were likely to cancel their business travel without rescheduling.
While 2019 business travel revenues in the hotel revenues finished the year at $89.55 billion, 2021 revenue is projected to be only $30.27 billion – a loss of 66.2 percent. Washington, D.C. is expected to have the steepest loss at 90.3 percent compared to 2019, with a monetary loss of $1.28 billion. Other major losses include Massachusetts (forecasted to finish 2021 84.8 percent below 2019 levels, for a loss of $1.9 billion) and New York (forecasted to be down 82.6 percent from pre-pandemic levels for a loss of $5.07 billion). California is forecasted to have the largest monetary loss, down $9.84 billion compared to 2019.
In Connecticut, hotel business travel revenues are projected to finish 2021 at $184.61 million – a loss of $382.14 million, or 67.4 percent, compared to 2019.
AHLA is urging Congress to pass the Save Hotel Jobs Act, which would establish a grant program to help hotel owners and operators meet payroll costs. The group says the industry has suffered some of the worst monetary losses during the COVID-19 pandemic but has not received direct aid, as the food service industry and arts and cultural venues have.