and Boston has increased.
(Tom Croke)
Has a soft economy chained the business traveler to the home office? The answer may depend upon whom you ask.
According to statistics compiled by the Travel Industry Association of America, the answer is no.
Beyond Cash Donations: How New Forms of Giving Are Transforming Not-for-Profit Accounting
Evolving Funding Landscape for Not-for-Profits Not-for-profit organizations are being asked to do more with less,…
Learn More
The TIA’s Survey of Business Travelers suggests that business travelers are traveling at least as much as they have in recent years.
More than one-in-five (22 percent) adults traveled for business at least once last year. And the number of U.S. adults taking at least one business trip during the year has reached nearly 44 million.
Each business traveler takes an average of 5.4 business trips a year, according to TIA — a figure that has remained virtually unchanged from recent years.
But there are also indications that any increase on the number of business travelers on the road may have slowed of late, along with the economy. Consider statistics compiled by the National Association of Realtors. That association reports that reduced business travel has slowed demand for hotel rooms in 54 markets throughout the country.
The NAR reports that demand increased 2.6 percent during the first quarter, which is about half of the 5 percent pace set in the fourth quarter.
The room occupancy rate, according to the NAR, slipped to 59.1 percent in the first quarter from 59.3 percent a year ago.
At the same time, average daily room rates rose 3.7 percent. Revenue per available room grew by 3.4 percent in the first quarter. Construction in the 54 markets tracks stood at 10.6 million square feet in the first quarter, unchanged from the fourth quarter.
This week’s Providence Business News/Johnson & Wales University “Executive Poll” queried respondents as to whether travel budgets at their respective companies or organizations had been adjusted prior to the beginning of the most recent fiscal year. The overwhelming majority of executives responding said that their travel budgets had largely “remained the same.”
But when questioned as to whether their business or organization now encourages employees to conduct more business on the telephone or via the Internet to cut down on the expense of business travel, the breakdown was more evenly split — suggesting that in fact, executives are keeping a close eye on business travel spending.
Bargain hunting
One point does seem certain. Companies are getting smarter when it comes to
business travel.
According to an American Express survey, U.S. businesses are spending air-travel dollars more effectively, paying just 2 percent more for flights in the third quarter than a year earlier even though business fares rose an average 6 percent.
The gap between the lowest unrestricted business fares bought at the last minute and those booked earlier using available discounts grew to its widest in three years during the quarter, the American Express Business Airfare Index also showed.
The widening gap shows that large businesses are negotiating with airlines for greater discounts and that individuals are finding lower fares when booking their own flights, said Melissa Abernathy, spokeswoman for American Express Travel Related Services.
“Business travelers are behaving more like leisure travelers,” said Abernathy. “They are more resistant to pay higher fares and are willing to put up with some inconveniences.”
According to the American Express survey, travelers who had avoided cost-saving connecting flights or early departures are more willing to accept them now that the average round-trip business fare has grown to $976. That’s a 6 percent jump from September 1998.
“There is greater opportunity to find much lower fares now than three or four years ago,” Abernathy said. “Companies negotiate better and employees are behaving differently. With more options presented, they tend to choose the lower-price options.”
American Express defines a typical business fare as the lowest fully refundable, economy-class fare available with no more than a three-day advance purchase. The index monitors flights from 40 major U.S. cities to a total of 215 destinations. During the third quarter, the average fare paid by business travelers was 41 percent lower than the typical business fare, the largest quarterly gap since the index began tracking the number in 1996. In September, typical business fares were 49 percent higher than in January 1996, while the average fare paid was 23 percent higher.
