November 29, 2022

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New York City's hotel and tourism business has a long way to go: the study

New York City’s hotel and tourism business has a long way to go: the study

world-famous New York Hotel and tourism industry It has surged sharply to return to its pre-pandemic glory days — travel revenue for the hotel business is expected to be 55% lower in the Big Apple market this year than in 2019, a new sobering industry analysis reveals.

The report from the American Hotel & Lodging Association and Kalibri Labs says hotel travel revenue across the United States in 2022 is expected to be 23% below pre-pandemic levels, ending the year more than $20 billion less than in 2019.

These predictions come next lost hotels Business travel revenue is estimated to be $108 billion during 2020 and 2021 combined.

The report said New York’s business hotel travel industry is suffering more than any market in the country — with the exception of San Francisco, where business hotel travel is expected to be 68% lower than in 2019.

Other urban hotel tourism markets still reeling from the COVID-19 crisis include blues in Washington, D.C., where business is expected to fall 54%, Chicago 49%, Boston 47%, and New Orleans 32% below 2019 levels.

The New York State The hotel business travel market as a whole is also lagging, with revenue expected to be 46% lower than in 2019.

Only San Francisco, where hotel business travel is expected to be 68% less than in 2019, is expected to suffer more than New York City.
John Lamparsky / Getty Images

This is the second-worst recovery in any state other than Wyoming, where revenue will be 63% behind in 2019, according to the survey.

“While COVID-19 case numbers are dwindling and permissive CDC guidelines provide a sense of optimism to reinvigorate travel, this report underscores how difficult it is for many hotels and hotel staff to recover from years of lost revenue,” said Chip Rogers, president. AHLA Executive.

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“The good news is that after two years of virtual work arrangements, Americans are realizing the unparalleled value of face-to-face meetings and saying they are ready to start getting back on the road for business travel.”

Screenshot of the report.
The forecast comes after hotels lost an estimated $108 billion in business travel revenue during 2020 and 2021 combined.
AHLA / Kalibri Labs

The COVID outbreak in 2020 and 2021 has shut down and disrupted travel, and ongoing disruption and a slow recovery could deprive city coffers of billions of dollars in revenue that helps pay for public services, such as police and schools.

New York City hosted 66.6 million visitors in 2019 with museums, nightlife, theatre, restaurants, trade fairs, and sporting events such as the marathon and the US Open tennis tournament.

But that number dropped 67% to 22.3 million visitors during the COVID-19 outbreak the following year, according to the State Comptroller’s Office.

Screenshot of the report.
Only three cities in the report were expected to see a positive tourism rate compared to 2019.
AHLA / Kalibri Labs

Tourism-related tax revenue accounted for 59% of the city’s $2 billion drop in tax collection during the first year of the pandemic, dropping by about $1.2 billion.

“We estimate that the occupancy and sales tax for hotels lost by the city in 2020 was about $920 million and $560 million in 2021,” Vijay Dandapani, president and CEO of the New York City Hotel Association, told The Post.

He said that the number of workers in the hotel sector permanently decreased by 20 thousand from 55 thousand to 35 thousand.

“A lot of these jobs are good for union pay,” Dandabani said.

Traffic is seen in Times Square on March 31, 2022.
In 2019, New York City hosted 66.6 million record-breaking visitors.
Corbis via Getty Images

In the pre-pandemic period, tourism made up 7.2% of all private sector employment in the Big Apple and 4.5% of private sector wages. Tourism indirectly supported 376,800 jobs in 2019, according to the Comptroller’s Office.

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Dandapani of the New York City Hotel Association confirmed that both occupancy and room rates remain far below pre-pandemic levels.

“New York City’s hotel jobs are still 30% below 2019 levels, mainly because both occupancy and rate have not recovered,” Dandabani said.

A hotel guest walks into the lobby of The Pierre, A Taj Hotel, New York on September 28.
In January, Gov. Cathy Hochhol budget forecast that New York’s hotel and hospitality industry likely won’t recover all of the jobs lost from the pandemic until 2026.
Angela Weiss/AFP via Getty Images

“The main reasons are the lack of recovery for business trips as the average price is twice the rate of a tourist guest with a longer stay,” he said.

But Dandabani complained that the government was part of the problem, not the solution.

“Another reason is the federal government’s continued insistence on 24-hour COVID testing (despite the vaccination requirement) for anyone entering the United States, which is a major disincentive for foreign business and tourist travel,” he said.

A guest departs The Pierre, A Taj Hotel, New York on September 28, 2020.
Tourism-related tax revenue accounted for 59% of the city’s $2 billion drop in tax collection during the first year of the pandemic.
Angela Weiss/AFP via Getty Images

Government. Kathy Hochhol Budget projections released in January warned that New York’s hotel and hospitality industry likely won’t recover all the jobs lost from the pandemic until 2026.

Last fall, Hochul directed a large part of the $450 million tourism revival program to New York. intensify Employment in the city’s 300 hotels – which employed about 50,000 workers before the pandemic.

The plan included $100 million for the Tourism Workers Recovery Fund, which set aside a one-time payment of $2,750 for up to 36,000 hotel workers and other workers in the tourism industry who were eligible for expired unemployment benefits.

Another $100 million is intended to incentivize hotels and other tourism-dependent businesses that have experienced job and revenue losses to rehire workers by providing grants of $5,000 to support each full-time worker added to the payroll and $2,500 for part-time workers.

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The head of the union representing hotel workers remained optimistic that the tourism industry would eventually return.

“Even after two years, we still have thousands of hotel workers laid off due to the slow return of work travel. But we are finally starting to see things go in the right direction, and hopefully we can get back to pre-pandemic levels,” said Rick Marocco, president of the Hotel Trade Council. in the near term.”