Days after the U.S. repealed the Covid-19 testing requirement for inbound air travelers, the U.S. Travel Association released its full biannual travel forecast through 2026, including both spending and travel volume, which projects that all travel segments, despite rising inflation. , will rise in the short run due to pent-up demand and consumer savings. However, this is not expected to last, leading to slower growth in the later years of the forecast. The international component of the forecast was launched earlier this month at the association’s IPW trade show.
US Travel estimates that $1.05 trillion (in 2019 dollars, adjusted for inflation) will be spent on travel to the United States in 2022, but that is still 10% below 2019 levels and 16% below it should be in 2022 if it wasn’t for the pandemic. The following table reflects annual expenditure estimates, adjusted for inflation, through 2026.
The forecast, based on analysis by Tourism Economics, projects that the volume of domestic business travel will reach 81% of pre-pandemic levels in 2022 and 96% in 2023. However, spending on domestic business travel, when adjusted for to inflation, it will not fully recover. pre-pandemic levels within the forecast range.
US Travel advocates for federal policies that accelerate the recovery of the business travel industry. In a recent letter to the US Treasury Secretary Janet Yellen, US Travel asked for the agency’s support on a package of tax hikes that includes a temporary restoration of the entertainment business expense deduction and an extension of the total expense for business meals. These policies are also key priorities for the US Travel Meetings Mean Business Coalition.
Domestic leisure travel will continue to drive the overall recovery of the U.S. travel industry in the short term, although spending is expected to remain $46 billion below what it would have been in 2022 had the pandemic not occurred.
Inbound international travel is moving towards recovery, helped by the recent repeal of the pre-departure entry testing requirement. The sector is expected to grow rapidly during the rest of 2022, and then grow at a slower rate in 2023-2026. A full recovery to pre-pandemic levels (volume and spending) is not expected until 2025.
However, policy changes may also help speed up that timeline. If the US USA reduce wait times for visitor visa interviews to less than 30 days, the US USA could gain an additional 2.2 million international visitors and $5.2 billion in spending by the end of 2022. US Travel has several policy proposals to restore visa processing operations around the world. :
- Develop a pilot program for the use of videoconferencing technology in low-risk visa interviews, return visa applicants, and visa applicants with urgent or time-sensitive travel.
- Prioritize visa processing resources to embassies and consulates that are in high demand.
- Temporarily extend all visitor visas for one year or waive visa interview requirements for applicants seeking a valid renewal, particularly for those currently in the United States.
- Consider allowing certain low-risk visa holders currently in the U.S. USA can renew their visa while in the US. USA
- Develop new ways to make the visa process more efficient for medium and large group travelers.
- Delay and reconsider the proposed increase in the nonimmigrant visa fee.
US Travel plans to revise the next biannual forecast in the fall of 2022.
Click here for the full forecast.