A report from The Knowland Group released this week shows that once the scare from the Omicron variant of Covid-19 died down in February, the pent-up demand for in-person business events was unleashed. By March, meetings business in most of the top 25 meeting markets in the country beat forecasts, while April is also on pace to notably exceed the forecasts made as recently as early February.
Further, Knowland’s forecast for meetings business in the biggest markets finds that Phoenix and Tampa will fully recover their 2019 event volume this year.
On the other hand, 16 of the 25 top markets will be less than 80 percent recovered by year’s end, while Chicago, Detroit, and Oahu will be less than 50 percent back to their 2019 event numbers.
Another recent report, this one from Deloitte, notes that there are both good and bad signs for group business travel going forward. “Over the remainder of 2022, corporate travel should grow significantly from its now-small base. Team meetings that have been postponed multiple times will finally take place. More conferences will shift back from online to in-person, and those that already have done so will likely see attendance improve. Even international trips should grow significantly, although some regions will recover faster than others.”
One factor that affects demand and prices in the top U.S. meeting markets is the strength of transient business travel. For that segment, Deloitte finds that “spend is projected to reach 36 percent of 2019 levels by midyear, and 55 percent by the end of 2022. Business travel is at least two years from reaching its pre-pandemic spending levels, as some travel use cases are expected to spur fewer trips over the long term.”
And there’s another wrinkle: “[The issue of] sustainability will push against future corporate travel spend. Three in 10 companies expect sustainability to cause a reduction in travel budgets of between 11 and 25 percent by 2025.”
For cities such as New York, San Francisco, Chicago, Los Angeles, and Boston—all losers of more than 70 percent of their business-travel revenue in 2021 compared to 2019, according to a report by the American Hotel & Lodging Association—the Deloitte predictions are unwelcome.
But for meeting planners, lackluster business-travel demand might present opportunities to secure space, dates, and rates that work for their 2022 groups versus the pre-pandemic demand and cost scenarios in those cities.
