Global travel analysts have highlighted that South Africa’s corporate travel scene has changed due to a combination of post-pandemic challenges, load shedding, and rising inflation.

According to Corporate Traveller’s new white paper – Economic Jet Lag: Understanding the Impact of SA’s Economy on Business Travel – economic shifts have influenced business travel in the country, giving rise to a shift in travel habits.

Broadly, these trends are:

• Business travellers are opting to stay at their destinations longer, clustering meetings to get more done on their trips;
• They are choosing premium flights and more luxurious hotel bookings;
• Load shedding is disrupting work-from-home and digital meetings, pushing more face-to-face interactions;
• Business travellers are being forced to be more productive, given the constraints of rising costs.

Bonnie Smith, GM of Corporate Traveller, said a major trend among South African business travellers is that they’re hitting the road less often but spending more.

The data shows that the number of travel bookings is down slightly in the first six months of 2023 compared to the same period in 2019.

However, the number of room nights is significantly up and has, in fact, increased by 88%.

“This trend indicates that business travellers are opting to stay longer at their destinations and planning more meetings during their trips,” said Smith. “We’re seeing business travellers clustering meetings to achieve more on each trip.”

Interestingly, despite the decrease in travel bookings, the research shows a significant increase in spending in the first six months of 2023 compared to the same period in 2019. These increases have been observed both in international and domestic accommodation.

The transactional value for various other travel components has also increased significantly. Spending on domestic flights increased by 151%, international flights by 112%, domestic car rentals by 62%, and international car rentals by 224%, the report added.

The report showed that the reasons for these increases in spending, while bookings remain constrained, are varied.

It seems that business travellers today are leaning towards more premium services.

Instead of booking economy flights or standard hotel rooms, they may be choosing business class flights or luxury accommodations.

Of course, increased prices also play a significant role in the surge in travel spend. Prices for accommodation, flights and car rental are up across the line after the pandemic.

The increase in travel spend comes at a time when companies in South Africa are feeling the pressure of load shedding and inflation.

The report revealed that power outages in South Africa aren’t just leaving people in the dark; they’re reshaping the future of work and business travel. Persistent load shedding is putting the brakes on the hybrid workplace trend, disrupting virtual connectivity and online business events, said Smith.

“South Africa is pivoting from the global trend, trading in digital workspaces for face-to-face offices, thanks to Eskom’s power failures.”

Smith added that face-to-face meetings are poised for a resurgence due to the struggle to keep the lights on. Power solutions are a financial black hole, forcing companies to opt for the certainty of in-person dealings.

Load shedding, ironically, is giving business travel an unexpected boost, making each trip a strategic play for maximum rate of return as companies scramble to maintain productivity in the dark.

Meanwhile, inflation has skyrocketed, with South Africa’s central bank raising its benchmark rate to a 14-year high.

This has gnawed away the purchasing power of citizens and placed a burden on households leaving them feeling the squeeze from power shortages and energy price hikes.

“Inflation drives up travel costs, affecting accommodation, transportation, and meals – which has also played a role in the decline of travel bookings and longer stays at the chosen destination,” Smith said.

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