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Travel bookings have increased after Covid-19 travel restrictions began to be lifted across the world. In what some specialists called “revenge travel”, consumers who had been denied the chance to travel and were able to afford it, began to buy air tickets and book, sometimes despite high prices. Though the numbers are not yet the same as those before the pandemic, the leisure travel industry is experiencing a form of recovery. But what about corporate travel?
The pandemic may have shown many companies that, at least in certain situations, travel was not as essential as it seemed to once have been. Forbes magazine reports that according to Morning Consult data, the percentage of frequent business travelers who won’t travel as much as they used to has gone up from 39% in October 2021 to 42% in February 2022.
In November 2020, Bill Gates predicted that more than 50% of business travel and more than 30% of days worked in offices would go away permanently. “Now that it’s not the gold standard to say, ‘Yes, you flew all the way over to sit in front of me,’ and that you can do the virtual connection, it will be a very high threshold for actually doing that business trip.”
The last two years people have shown they can work pretty well without traveling a lot.
Matthew Parsons, business travel Skift
Companies like Zoom, internet service providers and utilities companies might be benefiting from the shift in work habits at the cost of the travel industry. According to the US Travel Association, corporate travel pushed in 2019 close to $335 billion dollars in spending into the American economy, while supporting 2.5 million jobs. A drop in 50% corporate travel would represent a loss of roughly $167 billion dollars to the travel industry.
Many companies have noticed that they can reign in their travel expenses while maintaining a good relationship with customers and suppliers. A mix of travel and online meetings seems to be becoming a preferred choice for many. Travel requests are being scrutinized more closely than in the past. “The last two years, people have shown that they can work pretty well without traveling a lot,” Matthew Parsons, who covers business travel and writes for Skift told Forbes. “So the finance department’s going to be really watching company time on travel in the future.”
A potential side effect of traveling, especially after the pandemic, is the risk of being stranded at an airport due to delays or cancellations. Several European airlines and airports have faced not only staff shortages but also disruptions caused by strikes over salary increases and other benefits. This month, EasyJet’s CEO Johan Lundgren complained about the recent air traffic controller (ATC) strikes in France, saying the consequences are “completely unacceptable”.
In an interview with Agence France Press, he stressed that authorities better address the underlying issues before tourists start to choose other locations. “The strikes will have a dampening effect on demand,” he noted, adding that he had written to the French transport minister and aviation regulator to request an increase in the “minimum service level” guaranteed during the strikes.
There have been major flight disruptions amid strikes over France’s controversial pension reforms, which will see the minimum retirement age rise from 62 to 64. There have been cancellations and delays at French airports, but the air traffic controllers’ strikes mean that other flights crossing French airspace have also been affected. “We do not contest the right of people to strike,” Lundgren said. “But the consequences must be proportionate and flights over French territory must be protected.”
Not all is lost for the travel and hospitality industry as some players seem to be adapting to new lifestyle habits where individuals mix pleasure trips with teleworking or home office. One such company is Airbnb, whose profits remain healthy. “As lockdowns lifted, many people found themselves still able to work from home but not tethered to an office or even a specific location,” Catherine Powell, Airbnb’s global head of hosting told Forbes. “They searched for different homes, ones where they could take their families, their pets, and where they could continue working remotely. And they stayed for weeks at a time. We believe these longer stays and flexible living are here to stay.”
Aware that customers have changed the motivation behind their tip and lodging needs, the company has created a way to test the WiFi speed called Verified WiFi, as well as other tools that allow hosts to update their spaces in such a way that their needs can be met.
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