The recovery of international business travel to pre-pandemic levels is expected no earlier than 2025, according to the Global Business Travel Association (GBTA), one of world’s largest business travel associations.
The association has released its annual BTI Outlook, a detailed analysis of business travel in 2020, with projections for 2021 and beyond. Now in its 12th year, the BTI Outlook is an exhaustive study of business travel spending and growth covering 75 countries across 48 industries.
“Coming into 2020, business travel had grown for 10 consecutive years, with an average growth rate of 5.1 percent per year,” GBTA said.
The BTI Outlook showed that the true global financial impact of Covid-19 began in Q2 2020, resulting in an expected 68 percent decline (to 738 billion dollars) from April 1, 2020 to the end of the year.
Because of the relatively strong (pre-Covid) first quarter of 2020, global spending on business travel is expected to show a 52 percent decrease for all of 2020 (to 694 billion dollars), down from 1.4 trillion dollars in 2019.
Key findings of GBTA’s BTI Outlook include:
- Global GDP is expected to decline by 4.4 percent in 2020,
- Global trade is expected to contract by almost 11 percent due to lockdowns
- Job losses in the business travel industry have been extensive. The loss in global work hours during 2020 compared to the end of 2019 was equivalent to 400 million full-time jobs in the hotel, airline, airport, ground transportation, restaurant and other service provider segments.
- The impact of Covid-19 on business travel has varied by region:
- The magnitude of these losses and their impact on travel suppliers is unprecedented: the 2020 business travel spending losses are expected to be 10 times larger than the impact of either 9/11 or the Great Recession of 2008.
- Understandably, organizations with more exposure to sectors at the epicenter of the crisis are expected to face more volatility moving forward, including leisure and hospitality, ground transportation, retail, food services and energy.
The road to recovery
“A full recovery to pre-pandemic levels is expected by 2025,” GBTA says.
A 21 percent increase in business travel spending is projected in 2021, with most of this gain anticipated in the end of the year, as vaccinations increase globally and consumer confidence returns.
In 2022, the BTI Outlook forecasts further acceleration in business travel, including a significant pick-up in group meeting activity and international business travel.
While annual business travel spending growth is expected to slow somewhat in 2023, it is projected to remain well above historical average rates of growth of 4.6 percent.
By the end of 2024, annual business travel spending is projected to reach approximately 1.4 trillion dollars, nearly equaling the 2019 pre-pandemic revenue peak of $1.43 trillion.