This post originally appeared on The Basis Point: Business travel spending finally taking off again (CHART)
This week, The Economist provides a positive business travel spending summary:
According to the Global Business Travel Association (gbta), a trade body, worldwide spending on flights, hotels, car hire, restaurants and other expensable services fell from $1.4trn in 2019 to $660bn in 2020 as a result of covid-19 lockdowns and tough limits on cross-border movement.
See chart for projections of these numbers from 2022 to 2025. These are huge numbers, and meaningful for two reasons.
First, it’s not just about airlines. Expensable business spending also fuels local economies and will help to bring back restaurants, bars, and local drivers (taxi, Uber, Lyft) back up to speed financially. Plus it returns communities to their normal glory. It’s been great to see streets — and all the places on the streets — full again in San Francisco and the cities I’ve visited for work so far in this early ramp-back-up period. There’s a long way to go, as the chart indicates, but progress is palpable and very encouraging.
Second, relationships are driven by personal interaction. The pandemic proved remote work works — and I fully support employee flexibility to manage work and life from where they please as long as they’re productive. But when it comes to dealmaking — with clients, prospects, and present/future employees — face to face is hard to replace. There are folks who abuse business travel: spending too much, drinking too much, not working enough. But hard partying excessive conference goers are the exception, and generally business travel improves business.