It has been some time since we provided updates on the business travel industry. Since our blog in June[i] of last year, we’ve had another COVID-19 variant of concern (Omicron) and countries around the world have again reinstituted public health measures such as indoor masking and crowd control. What we have not seen is national lockdowns and border closings, which signals governments’ shifting views on COVID-19 as a manageable risk. Recently, the World Health Organization reported that countries with high immunity rates, strong health care infrastructure, and positive epidemiological trends may relax their restrictions.[ii] A number of European countries, including the U.K., have loosened restrictions this month. Just last week, England removed their public masking requirement and lifted their work-from-home order. Denmark has reduced COVID-19 measures and Switzerland lifted their work-from-home order.[iii][iv] In APAC, China, one of the top markets for business travel spend according to the GBTA,[v] continues to maintain a “Zero COVID” policy which is highly restrictive to airline travel.[vi]

Business travel spending in 2022 – A look from last year

For 2022, the GBTA forecasts 37.6% growth from 2021 for business travel spend.[vii] What are decision makers saying about spend? An October 2021 survey fielded by the GBTA found 22% of global CFO’s expect business travel spend to reach 2019 levels in the first half of 2022, while 30%  project a return to these levels in the second half of 2022.[viii] If we had to find a way to describe these numbers, we would say they were “cautiously optimistic.”

When will travel increase?

In study conducted last month from SAP Concur, 52% of finance managers reported that it is very likely or extremely likely that their company will see increased travel in 2022.[ix] This is obviously great news for an embattled travel industry that has been suffering through significant financial declines for the past two years. With recent developments in the increased immunization rates and countries loosening restrictions – we see reason for optimism.

Source: SAP Concur, 2022

Will hybrid/remote work change business travel?

We see one of the big questions in business travel to be the effects of the shifting work environment. In a survey by Skift & Trip Actions, the majority of both business travelers (66%) and corporate travel decision makers (66%) reported that their company will be planning a hybrid – partial week in office and at home—work schedule after the pandemic.[x] In the same survey, 73% of travel decision makers reported that they believe remote work will impact the frequency of business trips.[xi] Undoubtedly, the pandemic has forced employers to rethink their management models and employees have become accustomed to hybrid and remote working, so we can expect some travel cases to convert to digital experiences – why fly in the team for a training meeting that can be conducted online? Other types of travel cases, such as sales and conference engagements, tend to thrive on face-to-face interactions so we would expect these to return the fastest. Of course, only time will tell.

__________________________________________________________________________________________________________________________________________________________

[i] Steve Murphy, “Some Reason for Optimism in Business Travel,” Mercator Advisory Group, June 7, 2021, https://www.mercatoradvisorygroup.com/some-reason-for-optimism-in-business-travel/

[ii] Jamey Keaten, “’Take back life’: More nations ease coronavirus restrictions,” Associated Press, February 3, 2022, https://apnews.com/article/coronavirus-pandemic-business-health-pandemics-united-nations-ca046d38f7e78ad7150a0a8d95d81433

[iii] Ibid.

[iv] GBTA, 2021 BTI Outlook Annual Global Report & Forecast: Prospects for Global Business Travel 2021-2025, November 2021, Global Business Travel Association (GBTA), p. 6.

[v] Ibid., p. 6.

[vi] Edward White & Eleanor Olcott, “Closed China: Why XI Jinping is Sticking With His Zero-Covid policy,” Financial Times, February 1, 2022, www.ft.com/content/0e6914ed-3ce5-4f7f-ab91-ce7b0ad68f2c

[vii] Ibid., GBTA, p. 5.

[viii] Ibid., GBTA, p. 7.

[ix] SAP Concur, “New Pulse Surveys Explore Financial Impact of COVID-19 Business Travel Reductions,” SAP Concur, February 3, 2022, www.concur.com/newsroom/article/New Pulse Surveys Explore Financial Impact of COVID-19 business travel restrictions.

[x] Skift & Trip Actions, “The State of Corporate Travel and Expense 2022,” Skift & TripActions, p. 22

[xi] Ibid., p. 23.