New data from the Global Business Travel Association suggests that the recent U.S. travel ban may have a larger and more immediate impact on the travel industry.
In Europe, nearly half of travel professionals reported expectations for their company to reduce business travel over the next three months and 31% of U.S. respondents agreed. Based on the most recent industry data available as of Wednesday, the estimated impact is as follows:
- USA system-wide business travel transaction levels month-over-month (January 2017 vs. December 2016) decreased by up to 8% depending on industry and sector
- USA system-wide business travel transaction levels were increasing by 1.2% the week before the travel ban but decreased by 2.2% the week after the travel ban for a net negative industry impact of 3.4% in one week
- In that week, approximately $185 million in business travel bookings were lost as the uncertainty surrounding travel in general had a rippling effect on traveler confidence
- In 2016, 87.3% of USA business travel was domestic travel, 12.7% was international travel. This action had a significant disproportionate impact on international travel
- For every 1% impact on business travel spending annually, the United States gains or loses 71,000 jobs, nearly $5 billion in GDP, $3 billion in wages and $1.2 billion in tax collections
On Tuesday, San Francisco’s 9th U.S. Circuit Court of Appeals heard arguments from the Department of Justice and opposing attorneys from the states of Washington and Minnesota prior to ruling on President Donald Trump’s executive order banning travel to the U.S. from seven Muslim-majority countries. Ultimately, the court can choose to reinstate the travel ban or uphold the lower court’s ruling on the temporary stay, likely resulting in an appeal to the Supreme Court. Both scenarios would result in a loss for the travel industry and the economy, according to a blog post from GBTA Executive Director and COO Michael W. McCormick.