With unprecedented economic hardships facing the travel and tourism industry, Virginia Tech expert Nancy McGehee says the industry will undoubtedly recover, but it will be forever changed.
“Those in the industry who get through this will find ways to be more sustainable, use technology to become more efficient, and use data to forecast and prepare for other global phenomena and pivot their skill set to disaster recovery and resiliency.”
McGehee, a professor and department head of the Hospitality and Tourism Management program in the Pamplin College of Business at Virginia Tech, points to other recent national crises such as 9/11, the recession in 2008-09, and SARS, but says none of these compare to what we are seeing right now. “Many economists say it took three years to fully recover from SARS; this will take much longer.”
- History shows that with past crises companies were eventually able to develop resilience and recovery plans, capitalize on customer loyalty, and benefit from pent up demand. After we get through COVID-19, the world will be recovering from cabin fever, and people will have the need to get back out, see new vistas, and enjoy new experiences.
- The travel industry seems to be banding together to find ways to speak as one voice to legislatures and Congress in order to get support quickly and in a variety of ways to help those most in need of a safety net.
- Companies are asking for short-term loan and financing options, particularly for small businesses, quick processing of unemployment benefits for their employees, extension of tax filing deadlines, and clear delineations of essential businesses that need to remain open (and hopefully profitable) during times of national emergency.
- The restaurant industry is working together to speak as one voice in support of creative ways to keep operating while they can – customers getting takeout or delivery rather than eating in, buying gift card to be used later, and reminding folks to tip generously whenever possible. In areas where it is safe to do so, a coalition of restaurants is asking U.S. consumers to participate in “The Great American Takeout” on Tuesday, March 24, as the fallout from the coronavirus pandemic continues.
- The coalition’s regional and national brands are encouraging U.S. consumers to order at least one delivery or pick-up meal to show support for the restaurant community, which is struggling after state and city closures of dining rooms to stem the spread of the COVID-19 infection.
Economic Impact Stats:
- The United States Travel Association claims that 4.6 million US jobs will be lost before May of this year.
- The American Hotel and Lodging Association recently met with President Trump at the White House and asked for an unprecedented $250 billion relief package for the industry.
- The revenue per available room, a common baseline statistic for the hotel industry (along with occupancy), has fallen nearly a third in the past two weeks according to Smith Travel Research.
- The meetings and event industry is absolutely reeling from cancellations, with meetingsnet.com estimating $233 billion in losses by summer.