The hotel industry is projected to end 2021 down more than $59 billion in business travel revenue compared to 2019, according to a new report by the American Hotel & Lodging Association (AHLA) and Kalibri Labs. That comes after losing nearly $49 billion in business travel revenue in 2020.
Business travel is the hotel industry’s largest source of revenue and has been slow to return since the onset of the pandemic. It includes corporate, group, government and other commercial categories. Business travel revenue is not expected to reach pre-pandemic levels until 2024.
The new analysis comes on the heels of a recent AHLA survey, which found that most business travelers are canceling, reducing and postponing trips amid rising COVID-19 cases.
The lack of business travel and events has major repercussions for employment, and underscores the need for targeted federal relief, such as the Save Hotel Jobs Act, according to AHLA.
Hotels are expected to end 2021 down nearly 500,000 jobs compared to 2019. For every 10 people directly employed on a hotel property, hotels support an additional 26 jobs in the community, from restaurants and retail to hotel supply companies—meaning an additional nearly 1.3 million hotel-supported jobs are also at risk.
“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/CEO, 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. That’s why it’s time for Congress to pass the bipartisan Save Hotel Jobs Act to help hotel employees and small business owners survive this crisis.”
COVID-19 is the worst economic event in the history of the U.S. hotel industry. Many urban markets, which rely heavily on business from events and group meetings, continue to face a severe financial crisis, as they have been disproportionately impacted by the pandemic. The 10 markets projected to end 2021 with the largest declines in hotel business travel revenue are:
The 10 states projected to end 2021 with the largest declines in hotel business travel revenue are:
Despite being among the hardest hit, hotels are the only segment of the hospitality and leisure industry yet to receive direct aid. Hotels and their employees have displayed extraordinary resilience in the face of unprecedented economic challenges, and the industry needs support from Congress to achieve a full recovery, according to AHLA.