02 November 2012
By Stephanie Wharton
Reporter
swharton@hotelnewsnow.com
Story Highlights
- The total number of U.S. domestic trips taken in 2012 is expected to increase by 1.8% to 2.05 billion year over year.
- Ramifications of the fiscal cliff issue being dealt with by the U.S. Congress are up in the air, causing business travel to slow significantly.
- The U.S. Travel Association is expecting inbound travel to the U.S. to increase by 4% in 2013, in comparison with 3.8% growth in 2012.
WASHINGTON—The year in travel is closing out with some positive fundamental results, according to the U.S. Travel Association.
Specifically, the total number of U.S. domestic trips taken in 2012 is expected to increase by 1.8% to 2.05 billion year over year, surpassing the prior peak of trips taken in 2007, said David Huether, senior VP of economics and research at the U.S. Travel Association, during a conference call on Thursday.
Looking ahead to 2013, that number is projected to grow even higher, resulting in yet another record for the U.S. However, that growth will be at a much slower pace than the last few years, he said. “In 2013, the number of trips is going to increase by 1.1%,” he said.
One of the biggest factors that will influence that slowdown in growth is decreasing business confidence, Huether said. “There is some degree of uncertainty,” he said.
U.S. Travel is forecasting business trip growth to increase 0.9% in 2013, compared with 1.3% growth expected for this year.
Ramifications of the fiscal cliff issue being dealt with by the U.S. Congress are up in the air, he said, adding that “there are varying degrees of pain.”
Depending on what kind of deal is struck, travel industry leaders will begin to see some of the ramifications on the industry start to moderate a bit, he said.
“There are many forecasters … that think that if no deal is done, we could hit a recession in the first half of next year,” he said. “I think there’s going to be a significant motive to avert a disaster.”
The threat of a disaster still hangs, however, and that uncertainty is having an impact on travel planning right now. Because of that, business travel is going to slow down in the beginning of 2013, but “hopefully, we’ll see more activity going forward after that,” Huether said.
Domestic leisure travel will also play a factor in the slowdown of growth, he said. The amount of leisure trips will go up in 2013 by 1.2% to 1.59 billion in comparison with the 2% growth projected for this year.
It’s important to note, Huether said, that the growth of the last several years was pretty strong, and the slowdown on the leisure side can be seen as the market adjusting to that significant increase in such a short period of time.
Inbound international travel
U.S. Travel is expecting inbound travel to the U.S. to increase by 4% in 2013, in comparison with 3.8% growth in 2012.
And spending from international visitors will go up, too. The organization is forecasting that in 2012, 14.6% of all spend will come from international travelers, and in 2013, they expect international spend will account for more than 15% of all spending in the U.S.
“We see inbound traffic picking up a little in 2013 over 2012,” Huether said. “That’s on an assumption that the European economies are going to pick up a little steam in 2013.”
Although European visitors might account for the largest share of international guests, the fastest growing inbound travel markets will be Latin America and Asia/Pacific, he said. “As long as visa lines remain low in (China and Brazil), they will both provide a significant increase in trips this year,” he said.
Employment increases
The growth the U.S. is projected to see in domestic and international travel will enable the travel industry to add 98,000 jobs to the economy by 2013, Huether said.
The unemployment rate stands at 7.9%, but the important thing to the travel industry is the unemployment rate for people who have completed some portion of a college degree, he said.
“College graduates’ unemployment rate is 4.1%,” he said. A high percentage of leisure travelers stems from this segment of the population, which spells good news for the travel industry.
Specifically, the total number of U.S. domestic trips taken in 2012 is expected to increase by 1.8% to 2.05 billion year over year, surpassing the prior peak of trips taken in 2007, said David Huether, senior VP of economics and research at the U.S. Travel Association, during a conference call on Thursday.
Looking ahead to 2013, that number is projected to grow even higher, resulting in yet another record for the U.S. However, that growth will be at a much slower pace than the last few years, he said. “In 2013, the number of trips is going to increase by 1.1%,” he said.
One of the biggest factors that will influence that slowdown in growth is decreasing business confidence, Huether said. “There is some degree of uncertainty,” he said.
U.S. Travel is forecasting business trip growth to increase 0.9% in 2013, compared with 1.3% growth expected for this year.
Ramifications of the fiscal cliff issue being dealt with by the U.S. Congress are up in the air, he said, adding that “there are varying degrees of pain.”
Depending on what kind of deal is struck, travel industry leaders will begin to see some of the ramifications on the industry start to moderate a bit, he said.
“There are many forecasters … that think that if no deal is done, we could hit a recession in the first half of next year,” he said. “I think there’s going to be a significant motive to avert a disaster.”
The threat of a disaster still hangs, however, and that uncertainty is having an impact on travel planning right now. Because of that, business travel is going to slow down in the beginning of 2013, but “hopefully, we’ll see more activity going forward after that,” Huether said.
Domestic leisure travel will also play a factor in the slowdown of growth, he said. The amount of leisure trips will go up in 2013 by 1.2% to 1.59 billion in comparison with the 2% growth projected for this year.
It’s important to note, Huether said, that the growth of the last several years was pretty strong, and the slowdown on the leisure side can be seen as the market adjusting to that significant increase in such a short period of time.
Inbound international travel
U.S. Travel is expecting inbound travel to the U.S. to increase by 4% in 2013, in comparison with 3.8% growth in 2012.
And spending from international visitors will go up, too. The organization is forecasting that in 2012, 14.6% of all spend will come from international travelers, and in 2013, they expect international spend will account for more than 15% of all spending in the U.S.
“We see inbound traffic picking up a little in 2013 over 2012,” Huether said. “That’s on an assumption that the European economies are going to pick up a little steam in 2013.”
Although European visitors might account for the largest share of international guests, the fastest growing inbound travel markets will be Latin America and Asia/Pacific, he said. “As long as visa lines remain low in (China and Brazil), they will both provide a significant increase in trips this year,” he said.
Employment increases
The growth the U.S. is projected to see in domestic and international travel will enable the travel industry to add 98,000 jobs to the economy by 2013, Huether said.
The unemployment rate stands at 7.9%, but the important thing to the travel industry is the unemployment rate for people who have completed some portion of a college degree, he said.
“College graduates’ unemployment rate is 4.1%,” he said. A high percentage of leisure travelers stems from this segment of the population, which spells good news for the travel industry.
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