If you’re a planner who must use a first-tier destination for certain events, the following figures will confirm what you’re dealing with:
While the volume of events that took place in the top 25 U.S. cities in Q4 2023 was only about 93 percent of what it was in Q4 2019, group rates are nearly 14 percent higher now versus 2019. The result: In 2024, big-city hotels are seeing more than six percent growth in event-related revenue compared to before the Covid pandemic.
However, if you’re a planner who runs events outside of top-tier destinations, the budget squeeze is even greater. Across all U.S. destinations, Q4 2023 meeting volume was about 92 percent of what it was in Q4 2019, but rates have risen about 17 percent over that time. The result: Hotels are taking in about nine percent more revenue from events than they were before the pandemic.
These figures come from the recently released Hospitality Group & Business Performance Index from industry-research firm Knowland and travel-technology provider Amadeus.
As they negotiate for their business events throughout 2024, planners should keep in mind that further price hikes could be coming. The reason: Despite paying their highest average employee wages ever—just under $24 per hour—most hotels still say they have a shortage of service staff.
According to a January survey by the American Hotel and Lodging Association, 67 percent of more than 400 hotel managers say they still face a staffing shortage. As properties eventually get back to being fully staffed, their additional payroll expenses will likely be factored into rates for guest rooms, banquet services, and other elements of meetings.
