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Is Business Travel Back? The State of Corporate Travel

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Since COVID-19 first made its appearance in late 2019, two questions have been on many minds worldwide: “When will things return to normal?” “Will things ever return to normal?”

One aspect of “normal” is work-life, and individuals and businesses alike are rightly anxious about what the future holds. A better question to ask might be “What does ‘normal’ mean, in the here and now?”

How Business Is Done

In general, a business can be categorized into three main types, according to travel behavior at different stages of the pandemic. These types are:

  • Never Left
  • Never Returning
  • Wait and See

Never Left

This sector is comprised of workers whose travel is considered essential, including managers and field operation workers. Many members of this group began to travel for work as soon as lockdown restrictions were lifted—read more here.   

Never Returning

The pandemic allowed some companies to greatly reduce their corporate travel budgets or, in some cases, eliminate them entirely.

What started as an emergency response to unprecedented times has for some businesses become a new way of operating.

Wait and See

Businesses that continue to take a “wait and see” approach to travel make up the smallest segment of the corporate population.

Most of these businesses are non-competitive and include public sectors corporations, professional associations, and nonprofits. These industries, the smallest category, held many all-virtual events and remain poised to continue this trend.  

Travel Is Changing 

Due in no small part to vaccination efforts, business travel as a whole has made a faster-than-expected comeback.

In particular, in-person conferences are showing higher-than-expected attendance rates. However, the way businesses are engaging in travel looks different than it did pre-pandemic. Several factors explain this trend. 

Zoom Fatigue  

‘Zoom fatigue’ is a pandemic-born phenomenon. It describes the burnout and lethargy that many people have experienced as a result of attending so many virtual events.

Many workers and members of professional associations have recently begun to attend in-person events, even when a virtual attendance option is offered. Many would prefer to experience the expenses and inconveniences associated with travel rather than participate from a screen.

Leisure Travel Still Dominates  

While airlines are seeing an increase in business travel, leisure travel continues to dominate. However, there is reason to think that things will even out between the two.

As summer wanes, it seems likely that leisure travel will stabilize, at least until the holiday season. At the same time, many offices are planning for workers to return after Labor Day, signaling a return to relatively normal business operations.

Hotel Revenue Continues To Decline

While air travel has seen a significant boost from leisure and business travel, hotel revenue has lagged behind, even as in-person conventions have reemerged. It seems likely that employees and vacationers alike are taking advantage of personal networks or rental alternatives, such as Airbnb, to maintain some degree of social distancing.

International Travel

International flights are making a slower comeback than domestic ones. This is hardly surprising, given the ever-shifting landscape of vaccine distribution, masking mandates, and social distancing advice.

Many trips require a negative COVID test as a condition, a logistic hurdle to negotiate before takeoff. As the Delta variant continues its prevalence, the international travel landscape is likely to remain uncertain.    

What Happens Next?

As travel becomes an option again for individuals and businesses alike, life with COVID-19 remains a daily reality.

Much of what happens for business travel in the next year or two depends on several factors:

  • Local and regional vaccine distribution
  • Travel restrictions
  • Cost and availability of transportation and accommodation
  • Communication regarding changes

Local and Regional Vaccine Levels

Earlier in the pandemic, there was optimism that herd immunity to COVID might be achieved in the third or fourth quarter of the fiscal year.

With the Delta variant now in play, herd immunity looks more and more elusive. Keeping track of infection vs. vaccine rates locally and at destinations will continue to be crucial for business travel.

Travel Restrictions

While extensive travel lockdowns appear unlikely, COVID tests and quarantines will likely continue to be an important factor in business travel plans.

The Cost of Travel and Accommodation

Every facet of the travel industry: hotels, airlines, and rental car companies are making important financial decisions during this time. Will these decisions make travel more affordable, more expensive? Corporations must look at these factors and budget accordingly. 

Communication Is Key

Perhaps the most important factor in these times is communication—between the travel industry and their clients, and between employers and their employees embarking on a business trip.

Knowing what the travel plan is and having viable contingencies in place will make the difference between canceled plans and a flexible pivot in the future.

Image by John McArthur.

Post Author: Lillia Hall

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