What Will the Future of Business Travel Look Like?
Business travel has always required a certain degree of planning and intentionality. But in today’s post-COVID-19 world, the need for strategic forethought is more important than ever before. How you prepare will dictate whether or not it’s a safe, healthy, and productive trip.
The Impact of COVID-19 on the Travel Industry and Business Travel
Few industries have been hit as hard by the COVID-19 pandemic as the travel industry. This includes airlines, hotels, resorts, cruise lines, rental car companies, conference centers, and popular tourist attractions.
Total travel spending in the United States is projected to drop 45 percent by the end of the year. (Domestic travel spending will fall by 40 percent, while international inbound spending will shed 75 percent of spending.)
Whereas the U.S. economy is in a recession, the travel industry is officially in a depression. Overall unemployment is hovering around 51 percent – twice the unemployment rate of the worst year of the Great Depression!
Since the beginning of March, the COVID-19 pandemic has caused more than $250 billion in cumulative losses for the U.S. travel economy.
While road travel levels are nearly back to pre-pandemic levels, it was down 73 percent in the first week of April.
For much of April, daily TSA screens at U.S. airports were well below 100,000 – a decline of 96 percent from pre-pandemic levels.
These are just a few of the most striking data points. They show just how seriously the travel industry has been impacted and how much ground must be made up in order to get back to normal.
Certain types of travel will take a while to return to full strength. International leisure travel, for example, will be slow to bounce back. Business travel, on the other hand, is viewed as being much more important. So for companies and their employees, the question becomes: What does the future of business travel look like?
The New Normal for Business Travel
Whether it’s for business or pleasure, business travel will never look the same. The only thing we can equate this situation to is 9/11 when the entire air travel industry changed in a matter of days. Prior to the terrorist attacks, security was lax, kids could visit the cockpit during a flight, and there were no major concerns over air travel. But within hours, the entire TSA process changed, cockpits were locked down, and multiple systems were put into place to identify possible threats.
The travel industry is about to undergo significant changes again. Only this time around, the changes are intended to stop an invisible, deadly virus, rather than terrorists. A new normal is on the horizon and here are some developments and trends we can expect to see in the world of business travel:
1. Business Travel Will Become More Intentional
By some estimates, there will be a 5 to 10 percent permanent loss of business travel. (This means roughly 50 cents to $1 out of every $100 spent on business travel is gone forever – never to return.)
There will be a further dip related to failures. Numerous airlines, hotels, and travel companies won’t survive the economic effects of the pandemic and this will result in less inventory and opportunities for business travelers to utilize the resources they accessed prior to COVID-19.
Most importantly, each individual business will revisit its current approach to travel and make intentional decisions regarding what types of business travel are worth resuming.
“Sales and certain other kinds of business trips likely will remain essential and continue to be big revenue drivers for travel companies,” Dan Reed writes for Forbes. “But lots of businesses are learning right now that they really can get more done, and do so at much lower cost, via teleconferencing than they previously believed.”
In other words, all of those fluffy business trips where people travel just because “it’s the way it’s always been done” will need rethinking and retooling. Some businesses will choose to resume to normal, while others will leverage their newfound affinity for Zoom to cancel the bulk of their travel.
2. Domestic Travel Will Outpace International Travel
As current data already shows, domestic business travel is going to outpace international travel. We’ll see an uptick in ground travel first, followed by regional air travel, followed by cross-country air travel, and then by international travel.
Whether grounded in factual data or not, there’s a perception that it’s safer to travel within the United States than it is to travel abroad – even if COVID-19 numbers are higher in the U.S. Plus, there’s always the possibility that other nations shut down American flights into their borders.
3. Foreign Travel Restrictions May Linger
Presently, the CDC makes it clear that, with few exceptions, foreign nationals may not enter into the United States if they’ve visited China, Iran, the United Kingdom, the Republic of Ireland, Brazil, or the European Schengen area within the past 14 days. And it’s likely that travel restrictions will continue to linger for a few more months (at the least).
As restrictions are lifted, expect an increased focus on documentation. ESTA for business purposes will become more important than ever, as will medical records. (Proof of antibody testing and/or vaccination – if one becomes available – are all possibilities.)
4. Companies Will Enact Strict Policies
In large businesses that have hundreds or thousands of employees traveling the globe, expect stricter company policies that dictate the precise expectations and processes for employees. Videos, handbooks, and training on things like hygiene, packing, and human-to-human interaction will all be revisited.
How Will Changes Impact Your Travel?
Every situation is unique. It’s futile to cast a wide blanket across the business world or travel industry and say, “This is how it’s going to be.” So much about this pandemic is fluid. Circumstances and predictions seem to change on a daily basis, which leaves many businesses in challenging situations where they have to blindly balance risk and reward.
As the virus (hopefully) continues retreating and we get closer to a vaccine or cure, the expectation is that we’ll slowly resume to some sense of normalcy. But as suggested by the latest trends, “normal” is likely to take on a new definition for business travelers and the surrounding industries.