Business travel revenue for the U.S. hotel industry is expected to fall some $20.7 billion short of pre-pandemic levels this year, after an estimated $108 billion decline over 2020 and 2021, according to a study released Tuesday.
The report from American Hotel & Lodging Association and Kalibri Labs projects that hotel business travel revenue will remain 23% down from 2019 by the end of this year. Leisure travel, by contrast, is expected to bounce back to pre-pandemic levels in the coming months.
Indianapolis is predicted to fare better than than many other markets, but is still expected to see a decline in hotel business travel revenue of 16.4%, with revenue in the category falling from $508.1 million in 2019 to a a projected $424.7 million in 2022, the survey says. That’s a drop of $83.4 billion.
Statewide, Indiana is expected to see an 11.4% drop, from $1.14 billion to $1.01 billion.
“This report underscores how tough it will be for many hotels and hotel employees to recover from years of lost revenue,” said Chip Rogers, head of the AHLA.
Nationwide, business travel revenue is projected at $69 billion in 2022, compared with almost $90 billion in 2019.
In five big metro markets—New York City, San Francisco, San Jose, Washington D.C. and Chicago—the shortfall is expected to be around 50% or more. In New York’s case, that translates into a loss of $2.5 billion for the local economy.
Business travel—which includes corporate, group, government, and other commercial categories—is the hotel industry’s largest source of revenue and is not expected to fully recover until 2024, the AHLA said.