The Global Business Travel Association (GBTA) predicts inflation, rising energy prices, supply chain challenges, labour shortages and regional developments will add 18 months to the travel industry’s recovery forecast, according to its 2022 Business Travel Index™
GBTA (Global Business Travel Association) data shows that the global business travel industry will continue its progress towards full recovery – or to 2019 pre-pandemic spending levels of USD $1.4 trillion – but its recovery will hit some headwinds.
While many Covid-related recovery conditions have improved, some macroeconomic conditions deteriorated rapidly in early 2022. These new developments are impacting the timing and pace of business travel’s recovery, both globally and by region. It pushes the forecast for full recovery into 2026 instead of 2024 as previously forecasted.
The annual GBTA BTI. in association with Mastercard, studies business travel spending and growth covering 73 countries and 44 industries. The latest report – the 14th edition – outlines the top-level outlook for global business travel 2022 to 2026.
“The factors impacting many industries around the world are anticipated to impact global business travel recovery into 2025,” explains Suzanne Neufang, CEO, GBTA. “The forecasted result is we will get close, but we won’t reach and exceed 2019’s pre-pandemic levels until 2026.”
The previous BTI released in November 2021 predicted a surge in global business travel spending in 2022, reaching full recovery to the $1.4 trillion pre-pandemic mark by 2024.
Highlights from the latest BTI Outlook
- Total spending on global business travel reached $697 billion in 2021, 5.5% above the pandemic-era low of 2020. Last year was nearly as challenging as 2020 for the global business travel industry. The industry gained back roughly $36 billion of the $770 billion lost in 2020.
- Recovery was short-circuited by the Omicron variant and spike in global Covid cases in late 2021 and early 2022. As case numbers began to retreat, business travel surged. Global business travel spending in 2022 is expected to advance 34% over 2021 levels to $933 billion, recovering to 65% of pre-pandemic levels.
- Recovery in 2022 has been largely driven by improvement in the four factors of global business travel recovery – the global vaccination effort, national travel policies, business traveler sentiment, and travel management policy – where conditions have improved significantly in the last six months.
- Deteriorating economic conditions and shifting secular trends in 2022, however, have slowed global recovery. Hence, global business travel will almost reach pre-pandemic levels in 2025, reaching $1.39 trillion.
- Global spending is not expected to make it fully back to the $1.4 trillion dollar mark until mid-2026, when it is forecast to reach $1.47 trillion dollars. This adds an estimated 18 months to the industry’s previous recovery’s forecast.
- The biggest obstacles for speeding up the recovery in global business travel are persistent inflation, high energy prices, severe supply chain challenges and labor shortages, a significant economic slowdown and lockdowns in China, and major regional impacts due to the war in Ukraine as well as emerging sustainability considerations.
Divergent Recovery in Global Business Travel by regions
In all, global business travel spending is expected to gain 33.8% in 2022, however, differences are anticipated across the world’s top business travel markets.
- Both North America and Europe are expected to experience the sharpest recoveries with compound annual growth increases of 23.4% (to $363.7 billion) and 16.9% (to $323.9 billion), respectively by 2026.
- Asia Pacific helped lead the industry in terms of recovery of spend in 2021– particularly in China. This reversed in 2022, as China’s Zero-Covid policy led to wide-scale lockdowns and other countries in the region only slowly opened up. For 2022, a solid increase of 16.5% (or $407.1 billion) in spending is expected in APAC (held back by China at 5.6%, or $286.9 billion), with the region recovering to 66% of pre-pandemic levels by the end of 2022.
- Business travel spending in Latin America grew modestly in 2021 as the vaccination effort got off to a slower start. While there may be challenges in this region over the next few years, 55% growth in spend in Latin America is forecast for this year as business travel recovers to 83% of pre-pandemic totals.
