The challenges that business travel faces
International travel will continue to improve, bringing better connectivity with many of the United States' key trading partners. By the end of 2022, US corporate travel may near its new normal, the level it will sustain for the next several years. Assuming significantly reduced quarantine on arrival for Europe, the Middle East, and the Americas, and several months of a stable health situation, US corporate travel could reach 80% of 2019 levels.
Business travel's big buzzword now is "bleisure." It's exactly what it sounds like – a blend of business and leisure. A typical bleisure trip might be a three-day work trip with a few days of play tacked on to the front or back end. Or a one-week vacation might be extended to two weeks, with the traveler bringing along the technology needed to work from the road on the second week.
Global business travel is clawing its way back to normal after being decimated by the Covid-19 pandemic and the rapid shift to videoconferencing and virtual events, according to data from the Global Business Travel Association (GBTA). Hit hard by the pandemic, global business travel activity plummeted 53.8per cent in 2020, generating just $661 billion in revenue — down from $1.43 trillion in 2019. That figure rose to $754 billion last year, is expected to top $1 trillion in 2022, and return to pre-pandemic levels in 2024.
Over the remainder of 2022, corporate travel should grow significantly from its now-small base. Team meetings that have been postponed multiple times will finally take place. More conferences will shift back from online to in-person, and those that already have will likely see attendance improve. Even international trips should grow significantly, although some regions will recover faster than others.
As health concerns subside, companies will want to continue to bank some of the financial savings and environmentally friendly practices realized from two years of very limited travel. Corporate travel's return has begun, but the conferencing technology that replaced nearly all of it beginning in early 2020 will likely continue to replace some of it for the foreseeable future.
In 2023, Deloitte projects continued but decelerating improvement in corporate travel spends. Apart from the many unknowns surrounding international travel, by 2023 companies should begin to settle into their post pandemic travel norms. Leaders know in-person interaction can be a key component of innovation and growth and will be glad to see more employees get face time with clients and one another. But the pandemic has demonstrated the effectiveness of technology to replace a significant amount of travel, saving companies money and mitigating the harm business trips do to the environment.
The top driver for a return to international travel aligns with the biggest driver of domestic trips – 43 per cent of respondents rank sales visits among their top two reasons for sending travellers overseas in 2022. Leadership meetings (32 per cent) and client project work (31per cent) follow in importance. Conferences, which should see resurgence domestically in 2022, face another tough year attracting international delegates. Only 15per cent ranked industry events in their top two reasons for international travel.
As travel climbs back up from its pandemic lows, it will soon begin to push against companies' sustainability priorities and cost imperatives. Leaders will look to lock in gains in these areas as much as possible, even as they loosen the reins in the name of growth and innovation. Rising travel prices is one of the few travel-deterring factors that saw an increase in significance from 2021 to 2022. To keep costs under control, nearly three in four companies say they will limit the number of trips taken.