Hotel Industry Recovery Still A Few Years Away
The pandemic is expected to keep business travel suppressed until 2024 at the latest, according to the American Hotel & Lodging Association’s (AHLA) recently released “AHLA’s State of the Hotel Industry 2021.” In PPAI’s latest sales volume study, the lodging industry represented $435.6 million in sales in the promotional products industry in 2019—1.8 percent of total distributor sales.
“COVID-19 has wiped out 10 years of hotel job growth. Yet the hallmark of hospitality is endless optimism, and I am confident in the future of our industry,” says Chip Rogers, president and CEO of AHLA. “Despite the challenges facing the hotel industry, we are resilient. Hotels across the country are focused on creating an environment ready for guests when travel begins to return. AHLA is eager to work with the new administration and Congress on policies that will ultimately help bring back travel, from helping small-business hoteliers keep their doors open to ramping up vaccine distribution and testing. Together, we can bring back jobs and reignite a continued investment in the communities we serve.”
COVID-19 has been devastating to the hospitality industry workforce, which is down nearly four million jobs compared to the same time in 2019. While some 200,000 jobs are expected to be filled this year, overall, the accommodations sector faces an 18.9-percent unemployment rate, according to the Bureau of Labor Statistics, and will remain nearly 500,000 jobs below the industry’s pre-pandemic employment level of 2.3 million employees. In addition, half of U.S. hotel rooms are projected to remain empty in 2021.
Business travel, which comprises the largest source of hotel revenue, remains nearly nonexistent, but it is expected to begin a slow return in the second half of 2021. Among frequent business travelers who are currently employed, 29 percent expect to attend their first business conference in the first half of 2021, 36 percent in the second half of the year and 20 percent more than a year from now. Business travel is not expected to return to 2019 levels until at least 2023 or 2024.
Leisure travel is expected to return first, with consumers optimistic about national distribution of a vaccine and with that an ability to travel again in 2021. The report found that heading into 2021, consumers are optimistic about travel, with 56 percent of Americans saying they are likely to travel for leisure or vacation in 2021. While 34 percent of adults are already comfortable staying in a hotel, 48 percent say their comfort is tied to vaccination in some way.