LONDON — Global business travel is expected to rise by more than a quarter this year and reach two thirds of pre-pandemic levels by 2022, according to a report from World Travel & Tourism Council (WTTC) in collaboration with McKinsey & Company.
The report, Adapting to Endemic COVID-19: The Outlook for Business Travel, helps organizations prepare for corporate travel in a post-pandemic world. Specifically, business-travel spending will increase by 26 per cent this year, followed by a rise of 34 per cent in 2022, according to the report.
Additionally, the report recommends businesses adjust their revenue models, expand geographic focus and improve digital services to speed up the recovery of business travel. Its restoration will also depend on maintaining collaboration and partnerships across the private and public sectors.
“Business travel is starting to pick up. We expect to see two thirds by the end of 2022,” says Julia Simpson, president & CEO, WTTC. “Business travel has been seriously hit, but our research shows room for optimism with Asia Pacific and Middle East first off the starting blocks.”
In the Middle East, business spending is expected to rise by 49 per cent this year followed by 32 per cent in 2022. Asia Pacific business travel is set to increase by 32 per cent this year, followed by 41 per cent in 2022. Following closely behind is Europe, Africa and the Americas.
WWTC’s report also outlines significant changes over the past 18 months, with specific attention paid to demand, supply and operating environments which affect business travel. First, the demand for business travel has been slower to recover in comparison to leisure. Second, the pandemic has been driving technological innovations as online and hybrid events become the norm. Finally, the operating environment has a greater need for clarity around the rules and regulations necessary to allow unimpeded international travel.
Certainly, business travel is essential for global economic growth. In fact, business travel represented only 21.4 per cent of global travel in 2019, however, it was responsible for the highest spending in many destinations. Furthermore, business travel accounted for roughly 70 per cent of all global revenue for high-end hotel chains before the pandemic, while between 55 per cent and 75 per cent of airline profits came from business travellers, who made up approximately 12 per cent of passengers. This proves the importance of business travel in the recovery of the sector and its stakeholders in general.
“The loss of mobility experienced by billions of people during the COVID-19 pandemic served as a stark reminder of the immense social and economic contribution that travel and tourism brings to the global population,” says Paul Griffiths, CEO of Dubai Airports International. “Whilst the proliferation of digital communications is set to transform the way we do business, it has also proven that so many aspects of our lives are dependent on the level of social interaction uniquely afforded by the ability to travel. The industry must adapt to the new world in a more innovative, value driven and sustainable way and the initiative by WTTC sets out a clear road map for the future.”