Industry forecast: Inflation, labor shortages to delay recovery in business travel spending
A recovery in global business travel spending to pre-pandemic levels will likely be delayed by 18 months to 2026. Factors such as persistent inflation, high energy prices and labor shortages will contribute to a slower recovery, according to the Global Business Travel Association (GBTA).
The GBTA said business travel spending rebounded by 5.5 percent to $697 billion in 2021, with North America leading the recovery but remaining well short of the 2019 level of $1.4 trillion.
The recovery outlook is more pessimistic than GBTA's last forecast issued a year ago when it expected a full rebound to 2019 levels by 2024.
Environmental sustainability considerations and the regional impact of the Ukraine conflict are also weighing on travel demand, the forecast said.
"The factors impacting many industries around the world are also anticipated to impact global business travel recovery into 2025," GBTA CEO Suzanne Neufang said in a statement. "The forecasted result is we'll get close, but we won't reach and exceed 2019's pre-pandemic levels until 2026."
Global Business Travel Group, owner of the world's largest corporate travel agency American Express Global Business Travel, said last week that revenues this year were expected to average around 65 percent of 2019 levels. However, that did not include the impact of a possible recession.
Airlines and hotels have been relying on strong leisure demand to help fill the gap left by the decline in corporate travel during the pandemic.