WASHINGTON — The American Hotel & Lodging Association (AHLA) released AHLA’s State of the Hotel Industry 2021 last week, outlining the forecasted state of the hotel industry in 2021 and into the immediate future.
The report 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 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, the industry will remain nearly 500,000 jobs below the industry’s pre-pandemic employment level of 2.3-million employees. Overall, the accommodation sector faces an 18.9-per-cent 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 non-existent, but it is expected to begin a slow return in the second half of 2021. Among frequent business travellers who are currently employed, 29 per cent expect to attend their first business conference in the first half of 2021, 36 per cent in the second half of the year and 20 per cent 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 per cent of Americans saying they are likely to travel for leisure or vacation in 2021 — roughly the same amount as in an average year. While 34 per cent of adults are already comfortable staying in a hotel, 48 per cent say their comfort is tied to vaccination in some way.
Additional findings of the report include:
• business travel is forecast to be down 85 per cent compared to 2019 through April 2021 and then begin ticking up only slightly
• when selecting a hotel, enhanced cleaning and hygiene practices rank as guests’ number-2 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,” 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.”
The resurgence of COVID-19, the emergence of new strains and a slow vaccine rollout have added to the challenges the hotel industry faces this year. With travel-demand continuing to lag normal levels, national and state projections for 2021 show a slow re-bound for the industry, followed by acceleration in 2022.
