If the contributors’ thoughts shared in our 2023 Outlook are representative of the wider community, it would seem that recession and rising travel costs are uppermost on the industry’s collective mind. The extent to which those challenges will impact business travel’s ongoing recovery are also mulled over, together with the potential for ongoing staffing shortages.
According to a recent poll, nearly a quarter of European companies are considering limiting business travel because of economic concerns, while average airfares and hotel rates are both poised to rise more than eight per cent in 2023.
Turn back the clock 12 months, and many companies and associations were forecasting the extent of business travel recovery in 2022 – generally ranging from 60 to 80 per cent. It was almost an industry obsession, such was the desire for a healthy and resurgent sector. But with recovery well advanced and a number of challenges hitting the industry this year – and some likely to impact travel again in 2023 – perhaps drawing comparisons with 2019 travel volumes may seem less relevant.
Among the words of concern in this year’s Outlook are also reasons to be optimistic. The urgent need to reduce the environmental impact of business travel is, encouragingly, cited over and again, with the necessity of travel, its ROI or the composition of trips increasingly landing in the spotlight. While 85 per cent of business travellers believe travel continues to play a key role in increasing their revenue and profitability, 71 per cent also say they worry about its environmental impact.
Meanwhile, travel managers who’ve already been through the wringer could have further opportunity to widen their skillsets and remind the C-suite of their essential role in not only keeping operations running smoothly, but in optimising programmes in both the employer’s and employees’ best interests.
As VDR’s Christoph Carnier says, “this industry is used to dealing with challenges and will find new ways to cope with all this. More than ever, we must all collaborate.”
REVISITING THE 2022 OUTLOOK
Looking back at our 2022 Outlook published in December last year, it quickly becomes apparent how difficult it is to make any predictions or forecasts with any certainty. Conflict in Ukraine, an energy crisis, political upheaval, inflation, recession... tragically – especially in the case of Russia’s assault on Ukraine – they have all made their impression on 2022, yet none of them were even on the horizon 12 months ago.
Instead, there was much talk of growing vaccination rates, the further easing of travel restrictions, and just how rapidly business travel would recover domestically and internationally. Most prescient among contributors were those that foresaw the escalating staffing shortage, mounting travel disruption and rising costs as demand bounced back more swiftly than supply. “The infrastructure and networks we previously took for granted may struggle at times to cope with the initial stages of increased demand,” said ITM’s Scott Davies.
The BTA’s Clive Wratten singled out attracting new talent as “a major obstacle” for TMCs in 2022, while travel recruitment expert Emma Gregory pointed to a potential candidate shortage and warned TMCs to be “open minded to alternative experience and adjust their expectations and remuneration packages to encourage people to move from their existing roles or lifestyle.” The advice may continue to be prudent in 2023.
Read on to see what our contributors think 2023 holds in store...
"The travel industry is used to dealing with challenges and will find new ways to cope. More than ever, we must all collaborate – suppliers and customers alike. Only together are we stronger"
"It is critical that we work together in 2023 to accelerate decarbonisation and guarantee that the sustainable choice is the cheapest, educating buyers and travellers to make that decision-making process as easy as possible"
"We’re trying to keep our travel costs flat next year but I’m not sure that’s possible.With ongoing supply and capacity constraints all we see is increasing rates – we’re expecting at least 10 per cent on air and hotel costs"