Slowly but surely, business travel appears to be on the rise once again.
But it”™s the “slowly” part that has some observers worried.
“Domestic leisure travel is now at 99% of where it was pre-pandemic,” U.S. Travel Association President and CEO Roger Dow said at a June 15 webinar hosted by his organization. “But business travel is still 69% down from where it was last spring.”
Dow said estimates are that, if current trends continue, the business travel sector won”™t equal its pre-pandemic levels until 2024, “and that is certainly too long to wait.”
For calendar year 2019, domestic leisure travel accounted for $724 billion in spending while business travel added another $270 billion. Last year, leisure dropped to $555 billion but business plummeted to $88 billion.
The travel association forecasts those respective numbers to reach $671 billion and $116 billion this year; $718 billion and $193 billion in 2022; $737 billion and $235 billion in 2023; and $752 billion and $271 billion in 2024.
Only 35% of U.S. businesses are engaging in any travel, Dow said, placing most of the blame on the inconsistent guidance on large gatherings, which varies widely from state to state.
California and Washington state have eased many restrictions since the webinar, with Rhode Island and Michigan announcing plans to do the same. In a June 16 statement, Dow applauded those actions, which he said remove “critical barriers to the return of our pre-pandemic economy and livelihoods.
“States with delayed reopenings must recognize they”™re at a competitive disadvantage to those open for business, requiring focused efforts to encourage the safe return of both business and leisure travelers,” he continued.
“Similarly, companies that continue to restrict business travel and attendance at in-person professional meetings and events will delay their own economic recovery and give their competitors an edge.”
The organization has launched a website, letsmeetthere.travel, which maintains that “Professional meetings and events (PMEs) are different than most types of gatherings, providing a controlled setting for the secure implementation of health and safety measures designed to prevent the spread of Covid-19. In fact, according to scientific modeling by the Exhibitions and Conferences Alliance and Epistemix, in-person PMEs pose a near-zero (0.001%) risk of Covid-19 transmission to attendees ”” even for large events.”
Even so, “business leaders still don”™t know what to expect” as they try planning a large event or convention, Dow said at the webinar.
With roughly 54% of U.S. adults now fully vaccinated and nearly 66% having received at least one shot, he said, event planners need to overcome lingering doubts.
Bernadette Melnyk, vice president for health promotion, chief wellness officer and dean of the College of Nursing at The Ohio State University, said that taking basic precautions such as requiring masks and social distancing for unvaccinated people is still a good idea
“We have a saying at OSU. In God We Trust, but everybody else better bring data to the table.”
The co-author of “The Scientific-Based Evidence for Conducting Safe and Healthy Professional Meetings and Events,” which includes data from the Centers for Disease Control and Prevention and the Journal of the American Medical Association Network, Melnyk said she recommended event planners consider prepackaged meals and other low-touch dining and drinking options for attendees. Ventilation systems should also be evaluated if they have not already been, she said.
According to a March study by Freeman Research, 78% of attendees expect to attend in-person events in the fall, rising to 94% by winter. Exhibitors were slightly more optimistic with 80% returning this fall and 95% by winter.
In addition, 85% of respondents consider in-person events “irreplaceable” because of their ability to drive commerce and networking opportunities.
The Freeman report was based on data from more than 1 million U.S. event attendees, exhibitors, organizers and brand marketers, 20% of whom were international attendees.
“This research shows a light at the end of the tunnel with confidence in returning to in-person events up from an all-time low last spring,” Freeman CEO Bob Priest-Heck said. “When events return, commerce returns ”” by not only providing a platform for small business and larger corporations, but also benefiting the travel, hospitality, and tourism industries as well.”
“Summer kicked off with a very strong Memorial Day weekend,” Chris Nassetta, president and CEO of Hilton, said at the webinar. “We expect last summer to be the worst we”™ve ever had in the history of the business, but we”™re seeing historic levels of demand on the leisure side.
“We are confident that professionally planned events can be held across the country.”
Nassetta said that while Hilton is “hosting events every day, it”™s not like we were (pre-pandemic) by any stretch.”
Connecticut outlook positive
Meanwhile, the picture in Connecticut is also improving, according to Robert Murdock, Connecticut Convention & Sports Bureau president and director of national accounts.
“It”™s not like a light switch ”” it”™s more like a dimmer in how things are coming back,” he told the Business Journal, “particularly in the corporate market.”
Murdock said his organization is seeing “strong demand for events and on the leisure side as well. There”™s been a big uptick in RFPs for space. But people are still figuring out the whole convention business.”
He noted that summer historically has not been a big time for corporate events, given vacations and a preference for outdoor activities. “Even concerts tend to be outside at amphitheaters.”
Part of the algebra involved is when workers will go back to their offices on a regular basis, Murdock said. “A lot of places are starting to transition back to the office, but it may never be 100% ever again.”
Sporting events remained strong throughout the pandemic, he said. “The difference now is that, with league championships and the like, the kids can have their families with them.”
Murdock credited the administration of Gov. Ned Lamont, especially Department of Economic and Community Development Commissioner David Lehman, with “doing things that our neighbors didn”™t” when it came to allowing sports to continue last year. “That was really helpful to our hotels.”
He was also heartened by the news that the TSA screened more than 7.1 million people from Thursday to Monday of Memorial Day weekend ”” its highest traffic numbers since March 2020. “More people are flying,” he said. “It”™s probably more leisure than business, but we”™re definitely seeing an uptick.”
Thanks to the Connecticut Office of Tourism, which falls under the DECD, Murdock said the bureau can now “spend a little money to promote ourselves to media and event planners. We”™re focusing on people who maybe are still a little reluctant to attend a meeting or an event.”
Outreach efforts are focused both on Connecticut businesses and those in New York City, Albany, New Jersey, Philadelphia and Boston, he said.
The problem with some of potential events being booked in Connecticut is that planners often prefer to hold those events in different locations from year to year. “So if we missed out last year, it might be a number of years before they come back here,” he said.
