WASHINGTON–Credit unions that serve employees in the hotel industry or that have loans and lines of credit out to hotel owners will find little solace in a new report from the hotel industry.
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The American Hotel & Lodging Association has released its “AHLA’s State of the Hotel Industry 2021,” which examines the high-level economics of the hotel industry’s recovery, the specific impact on and eventual return of business travel, and consumer travel sentiments.
The AHLA reported the pandemic 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% unemployment rate, according to the Bureau of Labor Statistics. 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,” the association reported. “Among frequent business travelers who are currently employed, 29% expect to attend their first business conference in the first half of 2021, 36% in the second half of the year and 20% 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, according to the AHLA. The report found that heading into 2021, consumers are optimistic about travel, with 56% of Americans saying they are likely to travel for leisure or vacation in 2021. While 34% of adults are already comfortable staying in a hotel, 48% say their comfort is tied to vaccination in some way.
Other top findings in the report:
- Hotels will add 200,000 direct hotel operations jobs in 2021 but will remain nearly 500,000 jobs below the industry’s pre-pandemic employment level of 2.3 million employees
- Half of U.S. hotel rooms are projected to remain empty
- Business travel is forecasted to be down 85% compared to 2019 through April 2021, and then only begin ticking up slightly
- 56% of consumers say they expect to travel for leisure, roughly the same amount as in an average year
- Nearly half of consumers see vaccine distribution as key to travel
- When selecting a hotel, enhanced cleaning and hygiene practices rank as guests’ number two priority, behind price.
“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,” said Chip Rogers, president and CEO of AHLA.
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