U.S. travel grew in July, but a slowdown may be coming

U.S. travel increased this summer, but growth is slowing even as a global travel boom continues.

That’s according to the latest data from the U.S. Travel Association (USTA).

Travel to and within the United States grew 3 percent in July from a year earlier, according to the USTA’s Travel Trends Index. And travel for the first seven months of this year has grown faster than the same period in 2017, said David Huether, vice president for research for the USTA.

Growth is credited mainly to increased domestic travel on the heels of higher consumer confidence. Business travel, in particular, is having its best year since 2010, Huether said.

However, domestic and international travel growth decelerated from June to July, a trend the USTA expects to continue over the next six months, though growth will remain positive. The association predicts domestic travel will grow an average of 2.4 percent through January.

Adam Sacks, president of the tourism economics group at research firm Oxford Economics, said “cooling consumer indicators and the potential for slower business investment growth” through the rest of this year could hurt domestic travel. Oxford prepares the Travel Trends Index for the USTA.

For example, new orders for durable goods, which can reflect future consumer and business demand, declined 1.7 percent in July, according to the U.S. Census Bureau. In addition, steep U.S. tariffs on many foreign products have risen fears about the long-term effect of the escalating trade wars on U.S. consumers and businesses.

Census July 2018 durable goods chart

As global economic growth moderates, the USTA predicts international travel will grow at an average rate of 1.6 percent through January. A longer-term concern, said USTA CEO Roger Dow, is that inbound international travel is not accelerating fast enough to boost the U.S. share of the global travel market, which peaked at 13.6 percent in 2015.

Case in point: In 2017, nearly 77 million people from other countries visited the United States, which was basically flat (+0.7 percent) from 2016, according to recent data from the International Trade Administration’s National Travel and Tourism Office. More visitors came from South Korea (+18 percent), Brazil (+11 percent), Argentina (+10 percent) and Ireland (+9 percent).

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Study: Travel makes us happier

You know that feeling of not wanting vacation to end? You do anything to extend it — put off packing and make a few stops on the way to the airport.

There’s a reason for that.

Travel and happiness are linked, according to a new report.

While the survey by the U.S. Travel Association (USTA) focused on employees, it reflects a much broader group of people.

Employees who use most of their time off for travel are much happier than those who travel less or not at all, the report found. It also found that travel preferences — from vacation budget to what is packed into luggage — varies greatly from state to state.

Big Sur Hwy 1
AAA expects nearly two-thirds of the 88 million Americans planning a vacation this year to take a road trip. Driving along California Highway 1 (near Big Sur here) is a popular option. (Fred Moore via Creative Commons)

Overall, America’s work culture is starting to change, with more employers encouraging vacation and more employees feeling better about using their earned time off.

While the numbers have improved since 2015, most U.S. workers (52 percent) don’t use all of their annual vacation days. Those workers accumulated 705 million unused days in 2017, up from 662 million days in 2016.

Workers in Colorado, Virginia and Arizona lead the nation in taking vacation.

No. 1 is Colorado, where workers take average of 20 vacation days a year. In Virginia and Arizona, workers use about 19 days a year. The national average is 17 days.

Perhaps the more vacation time you earn, the more you use. Coloradans earn an average of 28 paid time-off days, more than any other state and higher than the national average of 23 days in 2017. Virginia workers earn an average of 25 paid time-off days a year.

Or perhaps it has something to do with office culture. In Virginia, 52 percent of companies encourage vacation, compared with the national 38 percent.

Workers in Montana, Delaware and Rhode Island are the worst at taking vacation. At the bottom is Montana, where workers take an average of 16 days. Montana workers also earn less time, an average of 21.8 days. That’s the third lowest nationally, after Rhode Island and Delaware (21.6 days each).

Translating time

Using more vacation days appears to create a positive economic impact. The increased vacation time from 16.8 days in 2014 to 17.2 days in 2017 generated $30.7 billion in economic impact nationwide. It also produced 217,200 jobs (direct and indirect) and generated $8.9 billion in additional income for Americans.

It also increases worker satisfaction, which may improve productivity. Workers in Arizona and Washington tie for highest rates of happiness with their company — 68 percent vs. 54 percent nationwide.

Who travels?

Even when workers take time off, less than half (48 percent) don’t travel.

Moreover, a recent Gallup poll found that 62 percent of all Americans took a vacation away from home last year, similar to 2005 but lower than 70 percent in 2001. Of that 2017 figure, only about one in five people traveled internationally.

Gallup found that married adults with children plus adults with higher incomes and a college degree took more vacations.

The USTA report concluded that baby boomers take more vacation days and travel more than other generations. That could be the result of boomers having longer job tenures to accumulate more time off and money to be able to travel more.

Once again, Colorado workers led the nation in using vacation days to travel: 57 percent vs. 47 percent nationally.

6 travel trends to look for this year

Who doesn’t love to travel?

Each year, many of us add more destinations to our bucket list and new experiences we want as part of those trips. That’s partly why travel is up and expected to grow even faster this year, according to the US Travel Association. Another reason is the strong economy and high unemployment giving people the means to travel.

Here are six trends that may reshape the way we travel this year and beyond:

1. Unplug

More travelers want to refresh themselves and escape their busy lives. They’re prioritizing mental health over fun and thrills, according to the ATTA-Outside study.

This trend, however, varies by age, according to AARP. Nearly half of boomers say they travel to relax and rejuvenate or as a getaway from everyday life. But nearly three-quarters of millennials expect to bring work along on a trip.

I wrote an article about spa travel for the Chicago Tribune in late 2016. Spa spending has grown steadily over the last decade.

Japanese garden at Osmosis Day Spa Sanctuary
The Japanese garden at Osmosis Day Spa Sanctuary in Freestone, Calif., offers another way to relax and meditate. (Photo by Sheryl Jean)

2. Higher prices

That relaxation may come at a higher cost this year — a reflection of the stronger U.S. economy and growing travel demand, according to a report by Carlson Wagonlit Travel and the GBTA Foundation. They expect global airfares to rise 3.5 percent, hotel prices to increase 3.7 percent and ground transportation, such as taxis, trains and buses, to remain more or less flat.

“If 2017 was the rise of the airline carriers’ “basic economy/no frills” concept, 2018 will be the hotel industry’s big year for ancillary charges,” according to a report by American Express. More lodgings are charging higher rates for a refundable room and fees for services that used to be free, such as Wi-Fi service, holding luggage, parking, early departures or a room safe, it said.

This may affect older travelers more because Baby Boomers (people age 54-72) prefer to stay in hotels or motels for amenities such as the concierge and room service, according to AARP. Millennials (age 13-36) are more open to staying in private home rentals, citing better prices, more space and amenities like a kitchen or washer/dryer.

3. Travel restrictions

Cheap regional airfares, home rentals and social media hype has contributed to overtourism in many popular places worldwide. Italy’s Cinque Terre is trying to control large tour groups that visit the five small, hillside towns linked by a trail along the Ligurian coast. Peru’s Machu Picchu restricts the number of visitors and how and when they access its ruins. Norway has introduced safety digital marketing to help deal with increased tourism and rescue calls.

The ATTA expects more places to restrict visitor access as governments and local residents protest the impact of overtourism on historical sites, pollution, traffic and the cost of living.

4. Customized travel

More people traveling to more places means there are fewer hidden gems and untrammeled areas. Research by Deloitte and the ATTA show that more travelers want personalized itineraries in their quest to experience something truly different.

5. Go local

Travelers also want more authentic interactions with local residents and communities, according to a study by the ATTA, East Carolina University and Outside magazine. This may include immersive experiences, such as staying overnight in a villager’s home or visiting a farm to learn about their sustainability efforts.

AARP found similar trends among international travelers: 49 percent want to “tour with a local” vs. 40 percent in 2017.

Bike and donkey in New Zeland
Personalized travel, such as a multi-day bicycle tour in New Zealand, lets you get closer to local people and animals. (Photo by Sheryl Jean)

6. Virtual travel

Simulated travel experiences based on virtual and augmented reality technology provide access for people who can’t travel, enhance travel with behind-the-scene looks at damaged or hard-to-reach sites and create new marketing opportunities, according to the ATTA. Discovery Communications’ Discovery TRVLR project takes people to the seven continents using VR headsets. Go Under the Canopy takes people into the Amazon rainforest in an educational VR tour by Conservation International and Jaunt. You can take an interactive kayak tour of the Grand Canyon with Immersive Entertainment.

Virtual travel still can’t replace the real thing.

New coalition aims to reverse declining international travel to the United States

A new business coalition hopes to work with the Trump administration to reverse declining international travel to the United States.

The Visit U.S. Coalition, which launched today, consists of trade groups that represent many travel-related businesses and workers.

As global travel increased 8 percent over the last two years, the U.S. share of that travel fell — from 13.6 percent in 2015 to 11.9 percent in 2017, according to data cited by the coalition.

International travelers spent $246 billion in 2016, according to the U.S. Travel Association (USTA), which is member of the coalition. About half of the 75.6 million foreign visitors that year were from Mexico and Canada.

President Donald Trump blocked travel from several largely Muslim countries, has proposed an end to so-called “chain immigration” and wants to erect a wall at the Mexico border. Visit U.S. cites the strong U.S. dollar, low-cost air travel and stronger air travel security as factors hurting international travel here.

In the coming weeks, Visit U.S. said it will propose policy recommendations. In addition to USTA, the coalition’s founding members include the American Gaming Association, American Hotel & Lodging Association, Asian American Hotel Owners Association, National Restaurant Association, National Retail Federation and U.S. Chamber of Commerce.

 

Survey: Christmas season is worst time to fly

Just as millions of Americans prepare to fly back home after Christmas, a new study finds that consumers think air travel is more frustrating than it was five years ago.

Consumers also think the Christmas season is the worst time of year to fly, according to the Morning Consult national survey conducted for the U.S. Travel Association (USTA), an industry trade group.

Such negative emotions mean fewer Americans are willing to travel. The survey found that air travel hassles stopped 24 percent of leisure travelers and 14 percent of business travelers from taking at least one trip in the last five years.

And that’s translated into real losses for the U.S. economy. In 2016, the USTA says Americans avoided 32 million air trips because of travel hassles, costing the economy more than $24 billion in spending.

Here are some of the survey findings over the last five years:

  • 60 percent say airline fees, such as those for checked bags, flight changes and seat assignments, have worsened.
  • 51 percent say the overall cost of flying has increased.
  • 47 percent say airport hassles, such as long lines and crowded terminals, have gotten worse.

Improving airports would help, according to the USTA. Two in five frequent business and leisure travelers would take at least three more trips a year if airport hassles were reduced or went away, according to the survey.

In addition, many survey respondents think Congress should pursue policies to: modernize airport and air traffic control infrastructure (60 percent), give airports more flexibility to improve air service options for travelers (55 percent) and maintain competition between airlines (53 percent).

Morning Consult surveyed 2,201 adults online from Oct. 10-12, 2017. Results have a margin of error of +/- 2 percentage points.