Sally French
If you’re a former jet-setter who hasn’t taken a business trip in years, continue to hang in there. Business travel dropped in 2020 and 2021, and it’s still not back.U.S. hotel business travel revenue for 2022 is expected to be 23% below pre-pandemic levels, according to an April report from the American Hotel & Lodging Association, or AHLA, conducted with hotel analytics group Kalibri Labs.And it’s not just hotel revenue that’s down. Research from the U.S. Travel Association, a nonprofit organization representing the travel industry, estimates that overall business travel spending will be down 24% in 2022 compared to 2019 levels.The outlookSome cities have been hit harder than others. AHLA released 2022 business travel revenue projections, and four major U.S. cities — San Francisco, New York, Washington, D.C., and San Jose, California — are expected to witness a more than 50% decrease in revenue versus 2019. San Francisco is being hit especially hard, with a nearly 70% decrease in revenue.
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% difference in projected 2022 business travel revenue versus 2019When will business travel return?The U.S. Travel Association estimates that domestic business travel won’t recover to 2019 levels until 2024, and it’s only expected to reach 76% of its 2019 levels this year. International business travel could take even longer to recover (until 2025), and is only predicted to reach 72% of its pre-pandemic levels in 2022, per the organization’s forecasts.For what it’s worth, there’s more business travel happening now than there was in 2020 or 2021. And the landscape of 2022 business travel is markedly different than pre-pandemic years. These days, there are fewer people attending conferences and in-person meetings with clients. But there’s an increase in other types of business travel.Team travel, where multiple employees on the same team meet up for an offsite or event, is up more than 900% between January and May 2022, according to corporate travel agency TripActions.TripActions data also shows that the number of travelers per company has increased. While previously, only a few employees might be constantly traveling to sales meetings and conferences, now a greater number of employees are traveling at least once for their jobs. A spokesperson for TripActions told NerdWallet that while in 2019, engineers made up 9% of bookings, these days they make up 13%. Meanwhile, salespeople previously made up 51% of bookings, but now make up just 45%.TripActions data also shows that the number of team bookings made was 7% higher in April 2022 versus its pre-pandemic peak in 2019.Changes to business travel: Good or bad for leisure travelers?The drop-off in business travel (and its slow return) comes with its pros and cons for leisure travelers.Con: Fewer opportunities to rack up loyalty points and statusFor some, personal travel is funded all or in part by points earned through business travel.Business travel can also generate opportunities to earn elite status levels that a person might otherwise be unlikely to attain through leisure travel alone.Spend five nights per month in a hotel for a consulting gig, and that’s enough to earn Hyatt’s top-tier Globalist status. That, in turn, matches to MGM Rewards Gold status, unlocking valuable benefits at the casino-centric hotel chain like waived resort fees, which could save you hundreds of dollars on your vacation in Las Vegas.How to use this to your advantage: You might not be able to rack up as many points and miles through work, but many brands have made it easier to earn or maintain status. Take a closer look at the loyalty programs you belong to because you might be a lot closer to earning elite status than you thought. If you’re just one or two nights or flights short of status, paying for a mattress run might still be worth it.Pro: Less competition with business travelers for availabilityFor Tim Leffel, editor of online travel magazine Perceptive Travel, the lack of competition for seats from business travelers has opened up more opportunities for deals.“As a leisure traveler, I’ve been very happy to see business travel slow to come back, as it has meant more opportunities to buy business class seats for a good price,” he says. “During the pandemic, I ended up buying multiple business class tickets between Mexico and the U.S.”Meanwhile, airlines typically offer upgrades based on elite status seniority. While a frequent business traveler might have ultra-high elite status, a leisure traveler with a low level of elite status might finally get granted that first class upgrade.How to use this to your advantage: Consider credit cards that offer automatic elite status. Even if it’s not necessarily the highest tier, you’re likely not competing right now with as many business travelers as usual. (And business travelers are more likely than leisure travelers to have elite status.) With fewer business travelers, you’ve got a better chance of getting an elite status upgrade than you did in past years.Con: Lack of business travel might be why prices are so highSome indicators suggest that it’s business travel that actually makes leisure travel cheaper, in part because more business travel means more route availability overall. For leisure travelers, more route availability means less need to stop for a layover or to fly at undesirable times. Business flights also tend to generate more revenue for airlines as those fares tend to be booked last-minute, include more flexible cancellation policies, or be in a higher class of service (or some combination of the three).How to use this to your advantage: Head to destinations that typically depend on business travel. While San Francisco is still expensive, it might be less expensive in 2022 versus 2019 given the decrease in business travel demand.The bottom lineBusiness travel is slowly returning, but it’s far from fully back. It could likely take years for business travel to return. And when it does, it likely won’t look like it did pre-pandemic.Expect more company-sponsored trips to meet up with teammates. Meanwhile, you might expect to attend fewer conferences or sales meetings. If you’re a former road warrior, you might find yourself traveling less than in your pre-pandemic days. But if you’ve never traveled on behalf of your company before, that might change — especially if you now have teammates distributed across the country.The article How Long It’ll Take for Business Travel to Return to Normal originally appeared on NerdWallet.
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